Rd instruction 1924-a table of Contents




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34

(Revision 2)


RD Instruction 1924-A

§1924.9 (b) (Con.)

(8) For irrigation and drainage construction or any dwelling construction where part or all of the work will be buried or backfilled, interim inspections should be made at such stages of construction that compliance with plans and specifications can be determined.
(c) Recording inspections and correction of deficiencies. All periodic and final inspections made by the County Supervisor or District Director will be recorded on Form RD 1924-12 in accordance with the FMI. The County Supervisor or District Director will be responsible for following up on the correction of deficiencies reported on Form RD 1924-12. When an architect/ engineer is providing services on a project, the District Director should notify the architect/engineer immediately of any fault or defect observed in the work or of any nonconformment with the contract document. If the borrower or the contractor refuses to correct the deficiencies, the District Director will report the facts to the State Director who will determine the action to be taken. No inspection will be recorded as a final inspection until all deficiencies or nonconforming conditions have been corrected.
(d) Acceptance by responsible public authority. When local (city) county, state, or other public authority) codes and ordinances require inspections, final acceptance by the local authority having jurisdiction will be required prior to final inspection or acceptance by Rural Development.
(e) Acceptance by project architect. If architectural services pursuant to §1924.13 (a) of this subpart have been obtained, final acceptance by the project architect pursuant to §1924.13 (a) (5) (v) of this subpart will be required prior to acceptance by Rural Development.
§1924.10 Making changes in the planned development.
The borrower may request changes in the planned development in accordance with this section.
(a) Authority of the County Supervisor. The County Supervisor is authorized to approve changes in the planned development involving loans and grants within the County Supervisor's approval authority provided:
(1) The change is for an authorized purpose and within the scope of the original proposal.

35

(5-12-87) SPECIAL PN

RD instruction 1924-A

§1924.10 (a) (Con.)

(2) Sufficient funds are deposited in the borrower's supervised bank account or with the interim letter, as appropriate, to cover the contemplated changes when the change involves additional funds to be furnished by the borrower.
(3) The change will not adversely affect the soundness of the operation or Rural Development's security. If uncertain as to the probable effect the change would have on the soundness of the operation or Rural Development security, the County Supervisor will obtain advice from the District Director on whether to approve the change.
(4) If a surety bond has been provided on the full amount of the construction contract, the aggregate amount of all contract change orders on Form RD 1924-7, "Contract Change Order," or other acceptable form will not exceed 20 percent of the original contract mount. Change orders for contracts on which a surety bond has been provided which increases the original contract amount by more than 20 percent may only be approved if additional surety is provided in the full revised amount of the contract. For purposes of this paragraph, letters of credit and deposits are not considered surety.
(5) Change orders for contracts on which letters of credit or deposits have been provided on the full amount of the contract which will increase the original contract amount are approved only if additional letters of credit or deposits are provided in the full revised amount of the contract.
(6) Modifications have been certified in accordance with §1924.5 (f) (1) (iii) or certification has been waived in accordance with §1924.5 (f) (1) (iii) (C) of this subpart.
(b) Authority of the District Director. The District Director is authorized to approve changes in the developing planned with RRH, RCH, and RHS loans and LH loans and grants within the District Director's approval authority, provided the conditions in §1924.10 (a) have been met. For such loans in excess of the District Director's approval authority, the borrower's request with the District Director's recommendation will be forwarded to the State Director for consideration.

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RD instruction 1924-A

§1924.10 (Con.)

(c) Recording changes in the planned development.


(1) Changes should be accomplished only after Rural Development written approval. Changes will not be included in payment requests until approved by the borrower; the contractor, if applicable; the architect/engineer, if applicable; and the Rural Development loan approval official. Examples of changes requiring documentation are:
(i) Any changes in labor and materials and their respective costs.
(ii) Changes in facility design.
(iii) Any decrease or increase in unit-price on final measurements that are different from those shown in the bidding schedule.
(iv) Any increase or decrease in the time to complete the project.
(2) All changes shall be recorded in chronological order as follows:
(i) Contract method. Changes shall be numbered in sequence as they occur using Form RD 1924-7 with necessary attachments.
(ii) Borrower method. An increase or decrease in the cash cost, extension of time, transfer of funds between items, or an addition or deletion of items of development, will be summarized on the front of Form RD 1924-1 by striking through the original figures on items and writing in the changes. Changes made in the "Development Plan" in the working drawings, or in the plans and specifications will be dated and initialed by all parties.
(iii) Mutual self-help method. [See paragraph (c) (2) (ii) of this section.]
(iv) Owner-builder method. [See paragraph (c) (2) (i) of this section.]
(3) All changes in facility design and/or materials must be certified in accordance with §1924.5 (f) (1) (iii) of this subpart.


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