Title 21 — Subtitle 07. Contract Terms and Conditions
Chapter 01. Mandatory Contract Provisions — All Contracts (except as provided under COMAR 21.05.07, 21.07.02, and 21.07.03)
Regulation .01 Parties to the Contract.LinkCopy Citation
Mandatory provision for all contracts.
Regulation .02 Scope of Contract.LinkCopy Citation
Mandatory provision for all contracts. This provision shall reflect the unilateral right of the State to order in writing changes in the work within the scope of the contract.
Regulation .03 Compensation and Method of Payment.LinkCopy Citation
Mandatory provision for all contracts. The contractor's taxpayer identification number consisting of the Social Security number for individuals and sole proprietors and the federal employer identification number for all other types of organizations shall be indicated in this clause.
Regulation .04 Contract Modifications.LinkCopy Citation
Mandatory provision for all contracts.
Regulation .05 Non-Hiring of Officials and Employees.LinkCopy Citation
Mandatory provision for all contracts: “No official or employee of the State of Maryland, as defined under General Provisions Article, §5-101, Annotated Code of Maryland, whose duties as such official or employee include matters relating to or affecting the subject matter of this contract, shall during the pendancy and term of this contract and while serving as an official or employee of the State become or be an employee of the contractor or any entity that is a subcontractor on this contract.”
Regulation .06 Disputes.LinkCopy Citation
Mandatory provision for all contracts. One of the following clauses is preferred:
A.
Alternate Disputes Clause (short form). “This contract shall be subject to the provisions of State Finance and Procurement Article, Title 15, Subtitle 2, Annotated Code of Maryland, and COMAR 21.10 (Administrative and Civil Remedies). Pending resolution of a claim, the Contractor shall proceed diligently with the performance of the contract in accordance with the procurement officer's decision.”
B.
Alternate Disputes Clause (long form).
Regulation .07 Maryland Law Prevails.LinkCopy Citation
Mandatory provision for all contracts unless otherwise authorized by the Board of Public Works.
Regulation .08 Nondiscrimination in Employment.LinkCopy Citation
Mandatory provision for all contracts. The following clause is preferred:
“The Contractor agrees: (a) not to discriminate in any manner against an employee or applicant for employment because of race, color, religion, creed, age, sex, sexual orientation, gender identity, marital status, national origin, ancestry genetic information or any otherwise unlawful use of characteristics, or disability of a qualified individual with a disability unrelated in nature and extent so as to reasonably preclude the performance of the employment, or the individual’s refusal to submit to a genetic test or make available the results of a genetic test; (b) to include a provision similar to that contained in subsection (a), above, in any underlying subcontract except a subcontract for standard commercial supplies or raw materials; and (c) to post and to cause subcontractors to post in conspicuous places available to employees and applicants for employment, notices setting forth the substance of this clause.”
Regulation .09 Contingent Fee Prohibition.LinkCopy Citation
Mandatory provision for all contracts:
“The contractor, architect, or engineer (as applicable) warrants that it has not employed or retained any person, partnership, corporation, or other entity, other than a bona fide employee or agent working for the contractor, architect, or engineer, to solicit or secure this agreement, and that it has not paid or agreed to pay any person, partnership, corporation, or other entity, other than a bona fide employee or agent, any fee or any other consideration contingent on the making of this agreement.”
Regulation .10 Multi-Year Contracts Contingent Upon Appropriations.LinkCopy Citation
Mandatory provision for all contracts and contract modifications to be effective in more than one fiscal year:
“If the General Assembly fails to appropriate funds or if funds are not otherwise made available for continued performance for any fiscal period of this Contract succeeding the first fiscal period, this Contract shall be cancelled automatically as of the beginning of the fiscal year for which funds were not appropriated or otherwise made available; provided, however, that this will not affect either the State's rights or the Contractor's rights under any termination clause in this Contract. The effect of termination of the Contract hereunder will be to discharge both the Contractor and the State from future performance of the Contract, but not from their rights and obligations existing at the time of termination. The Contractor shall be reimbursed for the reasonable value of any non-recurring costs incurred but not amortized in the price of the Contract. The State shall notify the Contractor as soon as it has knowledge that funds may not be available for the continuation of this Contract for each succeeding fiscal period beyond the first.”
Regulation .11 Termination for Default.LinkCopy Citation
Mandatory provision for all contracts. One of the following clauses is preferred:
A.
Alternate Clause — Termination for Default (short form).
B.
Alternate Clause — Termination for Default (long form).
Regulation .12 Termination for Convenience.LinkCopy Citation
A.
Except as provided in §B of this regulation, mandatory provision for all contracts. One of the following clauses is preferred:
(1)
Alternate Clause — Termination for Convenience (short form).
(2)
Alternate Clause — Termination for Convenience (long form).
B.
Leases of Real Property.
(1)
Inclusion of a termination for convenience clause in a real property lease is discretionary with the Board of Public Works, upon recommendation of the Secretary of General Services.
(2)
In recommending the exclusion of a termination for convenience clause in a real property lease, the Secretary shall consider such factors as:
(a)
The practicality of including the termination for convenience clause in a lease of real property located in another state or overseas when the demand for property of a particular type or in some particular geographic location is extremely intense, or when the contents of a lease are established by a foreign government and are effectively non-negotiable, or both;
(b)
The perception of some landlords that the termination for convenience clause permits the State to unilaterally convert a fixed term lease to a day-to-day lease; or
(c)
The prospects that some lending institutions may reject loan requests from landlords owning property that the State might wish to lease but that must be first upgraded at the owner's expense to meet State User Agency Requirements.
Regulation .13 Delays and Extensions of Time.LinkCopy Citation
Mandatory provision for all contracts. It shall be in substantially the same form as follows:
“Delays and Extensions of Time”
"The Contractor agrees to prosecute the work continuously and diligently and no charges or claims for damages shall be made by it for any delays or hindrances from any cause whatsoever during the progress of any portion of the work specified in this Contract.
“Time extensions will be granted only for excusable delays that arise from unforeseeable causes beyond the control and without the fault or negligence of the Contractor, including but not restricted to, acts of God, acts of the public enemy, acts of the State in either its sovereign or contractual capacity, acts of another Contractor in the performance of a contract with the State, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, or delays of subcontractors or suppliers arising from unforeseeable causes beyond the control and without the fault or negligence of either the Contractor or the subcontractors or suppliers.”
Regulation .14 Liquidated Damages.LinkCopy Citation
Mandatory provision for:
A.
All contracts with certified MBE participation goals in accordance with COMAR 21.11.03.10E; and
B.
Any other contracts deemed appropriate by the procurement officer in consultation with the Office of the Attorney General.
Regulation .15 Variations in Estimated Quantities.LinkCopy Citation
Mandatory provision for all contracts that contain estimated quantity items.
Regulation .16 Suspension of Work.LinkCopy Citation
Mandatory provision for all contracts. It shall be in substantially the same form as follows:
“The procurement officer unilaterally may order the Contractor in writing to suspend, delay, or interrupt all or any part of the work for such period of time as the procurement officer may determine to be appropriate for the convenience of the State.”
Regulation .17 Pre-existing Regulations.LinkCopy Citation
Mandatory provision for all contracts. It shall be in substantially the same form as follows:
“In accordance with the provisions of §11-206 of the State Finance and Procurement Article, Annotated Code of Maryland, the regulations set forth in Title 21 of the Code of Maryland Regulations (COMAR Title 21) in effect on the date of execution of this Contract are applicable to this Contract.”
Regulation .18 Payment of State Obligations.LinkCopy Citation
Mandatory provision for all contracts. The following clause is preferred:
“Unless a payment is unauthorized, deferred, delayed, or set-off under COMAR 21.02.07, Payments to the Contractor pursuant to this Contract shall be made no later than 30 days after the State’s receipt of a proper invoice from the Contractor.
The Contractor may be eligible to receive late payment interest at the rate of 9% per annum if:
Regulation .19 Financial Disclosure.LinkCopy Citation
Mandatory provision for all contracts:
“The Contractor shall comply with the provisions of State Finance and Procurement Article §13-221, Annotated Code of Maryland. That section requires a business to file with the Secretary of State of Maryland certain specified information, including disclosure of beneficial ownership of the business, within 30 days of the date the aggregate value of any contracts, leases, or other agreements that the business enters into with the State of Maryland or its agencies during a calendar year reaches $200,000.”
Regulation .20 Political Contribution Disclosure.LinkCopy Citation
Mandatory provision for all contracts:
“The Contractor shall comply with Election Law Article, Title 14, Annotated Code of Maryland, which requires that every person that enters into a procurement contract with the State, a county, or a municipal corporation, or other political subdivision of the State, during a calendar year in which the person receives a contract with a governmental entity in the amount of $200,000 or more, shall file with the State Board of Elections statements disclosing:(a) any contributions made during the reporting period to a candidate for elective office in any primary or general election; and (b) the name of each candidate to whom one or more contribution in a cumulative amount of $500 or more were made during the reporting period. The statement shall be filed with the State Board of Elections:(a) before execution of a contract by the State, a county, a municipal corporation, or other political subdivision of the State, and shall cover the 24 months prior to when a contract was awarded; and (b) if the contribution is made after the execution of a contract, then twice a year, throughout the contract term, on or before:(i) May 31, to cover the six (6) month period ending April 30; and (ii) November 30, to cover the six (6) month period ending October 31. Additional information is available on the State Board of Election website: http://www.elections.state.md.us/campaign_finance/index.html.”
Regulation .21 Retention of Records.LinkCopy Citation
Mandatory provision for all contracts. The following clause is preferred:
“The Contractor shall retain and maintain all records and documents relating to this Contract for three years after final payment by the State hereunder or any applicable statute of limitations, whichever is longer, and shall make them available for inspection and audit by authorized representatives of the State, including the procurement officer or designee, at all reasonable times.”
Regulation .22 Compliance with Laws.LinkCopy Citation
Mandatory provision for all contracts. The following clause is preferred:
"The Contractor hereby represents and warrants that:
Regulation .23 Cost and Price Certification.LinkCopy Citation
Mandatory provision for all contracts and contract modifications (excluding real property leases and architectural services or engineering services contracts (see Regulation .24)) if the contract or modification exceeds $100,000 or a smaller amount determined by the procurement officer under State Finance and Procurement Article, §13-220. The language shall be in substantially the same form as follows:
“Cost and Price Certification”
"A. The Contractor by submitting cost or price information certifies that, to the best of its knowledge, the information submitted is accurate, complete, and current as of a mutually determined specified date prior to the conclusion of any price discussions or negotiations for:
Regulation .24 Truth-In-Negotiation Certification.LinkCopy Citation
Mandatory provision for architectural services or engineering services contracts exceeding $100,000. It shall be in substantially the same form as follows:
“Truth-In-Negotiation Certification”
"The Contractor by submitting cost or price information, including wage rates or other factual unit costs, certifies to the best of its knowledge, information and belief, that:
"A. The wage rates and other factual unit costs supporting the firm's compensation, as set forth in the proposal, are accurate, complete and current as of the contract date;
Regulation .25 Contract Affidavit.LinkCopy Citation
Mandatory contract addendum. The contract addendum shall be in substantially the same form as follows and submitted upon initial award and each renewal thereafter:
Regulation .26 Commercial Nondiscrimination Clause.LinkCopy Citation
A.
The following provision is mandatory for all State contracts and subcontracts: “As a condition of entering into this Agreement, the company represents and warrants that it will comply with the State’s Commercial Nondiscrimination Policy, as described under Title 19 of the State Finance and Procurement Article of the Annotated Code of Maryland. As part of such compliance, Contractor may not discriminate on the basis of race, color, religion, ancestry or national origin, sex, age, marital status, sexual orientation, gender identity, or on the basis of disability, or other unlawful forms of discrimination in the solicitation, selection, hiring, or commercial treatment of subcontractors, vendors, suppliers, or commercial customers, nor shall Contractor retaliate against any person for reporting instances of such discrimination. Contractor shall provide equal opportunity for subcontractors, vendors, and suppliers to participate in all of its public sector and private sector subcontracting and supply opportunities, provided that nothing contained in this clause shall prohibit or limit otherwise lawful efforts to remedy the effects of marketplace discrimination that have occurred or are occurring in the marketplace. Contractor understands that a material violation of this clause shall be considered a material breach of this Agreement and may result in termination of this Agreement, disqualification of Contractor from participating in State contracts, or other sanctions. This clause is not enforceable by or for the benefit of, and creates no obligation to, any third party.”
B.
The following provision is mandatory for all State contracts: “As a condition of entering into this Agreement, upon the request of the Commission on Civil Rights, and only after the filing of a complaint against Contractor under Title 19 of the State Finance and Procurement Article of the Annotated Code of Maryland, as amended from time to time, Contractor agrees to provide within 60 days after the request a complete list of the names of all subcontractors, vendors, and suppliers that Contractor has used in the past 4 years on any of its contracts that were undertaken within the State of Maryland, including the total dollar amount paid by Contractor on each subcontract or supply contract. Contractor further agrees to cooperate in any investigation conducted by the State pursuant to the State’s Commercial Nondiscrimination Policy as set forth under Title 19 of the State Finance and Procurement Article of the Annotated Code of Maryland, and to provide any documents relevant to any investigation that are requested by the State. Contractor understands that violation of this clause is a material breach of this Agreement and may result in contract termination, disqualification by the State from participating in State contracts, and other sanctions.”
Regulation .27 Performance and Payment Bonds.LinkCopy Citation
Click here for full text of Regulation 21.07.01.27 (FORM AT END OF CHAPTER)
Regulation .28 Performance and Payment Bonds — Multiyear Annual and Renewable.LinkCopy Citation
Click here for full text of Regulation 21.07.01.28 (FORM AT END OF CHAPTER)
Regulation .29 Election Service Providers — Ownership of, Investment In, or Control of an Election Service Provider by a Foreign National.LinkCopy Citation
Mandatory provision for all State Board of Elections contracts, including secondary competition awards, with an election service provider, as defined in Election Law Article, Title 2, Subtitle 1, Annotated Code of Maryland. The following clause is preferred:
“The Contractor agrees to provide notice of:(a) any ownership of, investment in, or control of the election service provider by a foreign national at the time of the award of the contract; and (b) any material change in any ownership of, investment in, or control of the election service provider by a foreign national at any time for the duration of the contract. All notices required by this provision shall include:(a) the name and nationality of the foreign national that has ownership of, investment in, or control of the election service provider; and (b) the nature and extent of the ownership, investment, or control.
On a determination by the Administrator of the State Board of Elections that the foreign national has the ability to control, influence, or direct the election service provider in any manner that would compromise or influence, or give the appearance of compromising or influencing, the independence and integrity of an election, the Administrator of the State Board of Elections may terminate, in whole or in part, the contract with the election service provider.
Within 7 days after the Administrator of the State Board of Elections exercises the authority to terminate, in whole or in part, a contract with an election service provider under this regulation, the Administrator of the State Board of Elections shall notify the appropriate persons in writing of the termination of the contract and the Administrator’s reasons for terminating the contract.”
Regulation .30 Election Service Providers — Actual or Attempted Security Violations.LinkCopy Citation
Mandatory provision for all State Board of Elections contracts, including secondary competition awards, with an election service provider, as defined in Election Law Article, Title 2, Subtitle 1, Annotated Code of Maryland. The following clause is preferred:
“The Contractor, upon receipt of knowledge that a security violation or significant attempted security violation, as defined in Election Law Article, Title 2, Subtitle 1, Annotated Code of Maryland, has occurred involving an election system provided, supported, or maintained by the election service provider, shall:(a) notify the Administrator of the State Board of Elections in writing as soon as practicable, but not later than four days after becoming aware of the security violation or significant attempted security violation; and (b) cooperate with the Administrator of the State Board of Elections in submitting a report on each security violation and significant attempted security violation involving an election system.”
Regulation .31 Prompt Payment of Subcontractors.LinkCopy Citation
Mandatory provisions for all contracts:
A.
This contract and all subcontracts issued under this contract at any tier are subject to the provisions of State Finance and Procurement Article, §15-226, Annotated Code of Maryland, and COMAR 21.10.08. In §§A—D of this regulation, the terms “undisputed amount”, “prime contractor”, “contractor”, “subcontractor,” “supplier”, and “supplier” have the meanings stated in COMAR 21.10.08.01.
B.
A contractor shall promptly pay its subcontractors or suppliers an undisputed amount to which a subcontractor or supplier is entitled for work performed under this contract within 10 days after the contractor receives a progress payment or final payment for work under this contract.
C.
If a contractor fails to make payment within the period prescribed in §B of this regulation, a subcontractor or supplier may request a remedy in accordance with COMAR 21.10.08.
D.
A contractor shall include in its subcontracts at any tier for work under this contract wording that incorporates the provisions, duties, and obligations of §§A—D of this regulation, State Finance and Procurement Article, §15-226, Annotated Code of Maryland, and COMAR 21.10.08.
Chapter 02. Mandatory Construction Contract Clauses
Regulation .01 Application.LinkCopy Citation
A.
In addition to the clauses required by this chapter, each construction contract shall include the clauses required by COMAR 21.07.01.
B.
If clauses covering the same subject matter are required by COMAR 21.07.01 and this chapter, the clauses set forth in this chapter shall be used in each construction contract.
C.
The language of the clauses set forth in this chapter may not be varied.
Regulation .02 Changes.LinkCopy Citation
Mandatory provision for all construction contracts:
"Changes
"(1) The procurement officer unilaterally may, at any time, without notice to the sureties, if any, by written order designated or indicated to be a change order, make any change in the work within the general scope of the contract, including but not limited to changes:
Regulation .03 Variations in Estimated Quantities.LinkCopy Citation
Mandatory provision for only those construction contracts that contain estimated quantity items:
"Variations in Estimated Quantities
“Where the quantity of a pay item in this contract is an estimated quantity and where the actual quantity of such pay item varies more than twenty-five percent (25%) above or below the estimated quantity stated in this contract, an equitable adjustment in the contract price shall be made upon demand of either party. The equitable adjustment shall be based upon any increase or decrease in costs due solely to the variation above one hundred twenty-five percent (125%) or below seventy-five percent (75%) of the estimated quantity. If the quantity variation is such as to cause an increase in the time necessary for completion, the procurement officer shall, upon receipt of a written request for an extension of time within ten (10) days from the beginning of the delay, or within a further period of time which may be granted by the procurement officer before the date of final settlement of the contract, ascertain the facts and make the adjustment for extending the completion date as in the procurement officer’s judgment the findings justify.”
Regulation .04 Suspension of Work.LinkCopy Citation
Mandatory provision for all construction contracts:
"Suspension of Work
"(1) The procurement officer unilaterally may order the Contractor in writing to suspend, delay, or interrupt all or any part of the work for a period of time as the procurement officer may determine to be appropriate for the convenience of the State.
"(2) If the performance of all or any part of the work is for an unreasonable period of time, suspended, delayed, or interrupted by an act of the procurement officer in the administration of this contract, or by the procurement officer’s failure to act within the time specified in this contract (or if no time is specified, within a reasonable time), an adjustment shall be made for any increase in the cost of performance of this contract (excluding profit) necessarily caused by an unreasonable suspension, delay, or interruption and the contract modified in writing accordingly. However, no adjustment shall be made under this clause for any suspension, delay, or interruption to the extent(1) that performance would have been so suspended, delayed, or interrupted by any other cause, including the fault or negligence of the Contractor or (2) for which an equitable adjustment is provided for or excluded under any provision of this contract.
“(3) No claim under this clause shall be allowed(1) for any costs incurred more than 20 days before the Contractor shall have notified the procurement officer in writing of the act or failure to act involved (but this requirement shall not apply as to a claim resulting from a suspension order), and (2) unless the claim, in an amount stated, is asserted in writing as soon as practicable after the termination of a suspension, delay, or interruption, but not later than the date of final payment under the contract.”
Regulation .05 Differing Site Conditions.LinkCopy Citation
Mandatory provision for all construction contracts:
"Differing Site Conditions
"(1) The Contractor shall promptly, and before such conditions are disturbed, notify the procurement officer in writing of:(1) subsurface or latent physical conditions at the site differing materially from those indicated in this contract, or (2) unknown physical conditions at the site of an unusual nature, differing materially from those ordinarily encountered and generally recognized as inhering in work of the character provided for in this contract. The procurement officer shall promptly investigate the conditions, and if the procurement officer finds that such conditions do materially so differ and cause an increase or decrease in the Contractor’s cost of, or the time required for, performance of any part of the work under this contract, whether or not changed as a result of such conditions, an equitable adjustment shall be made and the contract modified in writing accordingly.
"(2) No claim of the Contractor under this clause shall be allowed unless the Contractor has given the notice required in paragraph(1) of this clause; provided, however, the time prescribed therefor may be extended by the State.
“(3) No claim by the Contractor for an equitable adjustment hereunder shall be allowed if asserted after final payment under this contract.”
Regulation .05-1 Disputes.LinkCopy Citation
Mandatory provision for all construction contracts:
“A. This contract is subject to the provisions of State Finance and Procurement Article, Title 15, Subtitle 2, Annotated Code of Maryland, and COMAR 21.10.
“B. Except as otherwise provided in this contract or by law, all disputes arising under or as a result of a breach of this contract that are not disposed of by mutual agreement shall be resolved in accordance with this clause.
“C. As used herein, claim means a written demand or assertion by one of the parties seeking, as a legal right, the payment of money, adjustment or interpretation of contract terms, or other relief, arising under or relating to this contract. A voucher, invoice, or request for payment that is not in dispute when submitted is not a claim under this clause. However, if the submission subsequently is not acted upon in a reasonable time, or is disputed as to liability or amount, it may be converted to a claim for the purpose of this clause.
“D. Within 30 days after contractor knows or should have known of the basis for a claim relating to this contract, contractor shall file a written notice of claim with the procurement officer.
“E. Contemporaneously with, or within 90 days after, the filing of a notice of claim, contractor shall submit the written claim to the procurement officer. If contractor so requests, the procurement officer, on conditions the procurement officer deems satisfactory to the unit, may extend the time in which contractor must submit the claim. An example of when a procurement officer may grant an extension includes situations in which the procurement officer finds that a contemporaneous or timely cost quantification following the filing of the notice of claim is impossible or impractical.
“F. The claim shall set forth all the facts surrounding the controversy. Contractor, at the discretion of the procurement officer, may be afforded an opportunity to be heard and to offer evidence in support of the claim.
“G. The procurement officer shall mail or deliver written notification of the final decision within:
“(1) 90 days after the procurement officer receives the claim if the claim is an amount for which the Appeals Board accelerated procedure, set forth in COMAR 21.10.06.12, may be used;
“(2) 180 days after the procurement officer receives the claim for a claim not covered under G(1) of this clause; or
“(3) A longer period that the procurement officer and contractor agree to in writing.
“H. The final decision may award a contract claim only for those expenses incurred not more than 30 days before contractor was initially required to have filed the notice of claim.
“I. The procurement officer's decision is the final action of the agency. If the procurement officer fails to render a final decision within the time required, contractor may deem the failure to be a final decision not to pay the claim.
“J. If the final decision grants the claim in part and denies the claim in part, the agency shall pay contractor the undisputed amount. Payment of the partial claim is not an admission of liability by the agency and does not preclude the agency from recovering the amount paid if a subsequent determination modifies the final decision.
“K. Contractor may file a written appeal with the Maryland State Board of Contract Appeals within 30 days of receipt of notice of the decision.
“L. Pending resolution of a claim, contractor shall proceed diligently with the performance of the contract in accordance with the procurement officer's decision.”
Regulation .05-2 Prompt Payment of Subcontractors.LinkCopy Citation
Mandatory provisions for all construction contracts:
Regulation .05-3 Retainage.LinkCopy Citation
Mandatory provisions for all construction contracts:
Regulation .06 Site Investigation.LinkCopy Citation
Mandatory provision for all construction contracts:
"Site Investigation
“The Contractor acknowledges that the Contractor has investigated and satisfied itself as to the conditions affecting the work, including but not restricted to those bearing upon transportation, disposal, handling and storage of materials, availability of labor, water, electric power, roads and uncertainties of weather, river stages, tides or similar physical conditions at the site, the conformation and conditions of the ground, the character of equipment and facilities needed preliminary to and during prosecution of the work. The Contractor further acknowledges that the Contractor has satisfieditself as to the character, quality and quantity of surface and subsurface materials or obstacles to be encountered insofar as this information is reasonably ascertainable from an inspection of the site, including all exploratory work done by the State, as well as from information presented by the drawings and specifications made a part of this contract. Any failure by the Contractor to acquaint itself with the available information may not relieve the Contractor from responsibility for estimating properly the difficulty or cost of successfully performing the work. The State assumes no responsibility for any conclusions or interpretations made by the Contractor on the basis of the information made available by the State.”
Regulation .07 Default, Delay and Time Extensions.LinkCopy Citation
Mandatory provision for all construction contracts:
“Termination for Default — Damages for Delay — Time Extensions
“(1) If the Contractor refuses or fails to prosecute the work, or any separable part thereof, with such diligence as shall insure its completion within the time specified in this contract, or any extension thereof, fails to complete said work within this time, or fails to provide any required annual and renewable bond 30 days prior to expiration of the current bond then in effect, the State may, by written notice to the Contractor, terminate the Contractor’s right to proceed with the work or the part of the work as to which there has been delay. In this event the State may take over the work and prosecute the same to completion, by contract or otherwise, and may take possession of and utilize in completing the work the materials, appliances, and plant as may be on the site of the work and necessary therefor. Whether or not the Contractor’s right to proceed with the work is terminated, the Contractor and its sureties shall be liable for any damage to the State resulting from the Contractor’s refusal or failure to complete the work within the specified time.
“(2) If fixed and agreed liquidated damages are provided in the contract and if the State so terminates the Contractor's right to proceed, the resulting damage shall consist of such liquidated damages until a reasonable time as may be required for final completion of the work together with any increased costs occasioned the State in completing the work.
“(3) If fixed and agreed liquidated damages are provided in the contract and if the State does not so terminate the Contractor's right to proceed, the resulting damage shall consist of these liquidated damages until the work is completed or accepted.
“(4) The Contractor's right to proceed may not be so terminated nor the contractor charged with resulting damages if:
Regulation .08 Liquidated Damages.LinkCopy Citation
Mandatory provision for:
A.
All contracts with certified MBE participation goals, in accordance with COMAR 21.11.03.10E; and
B.
All construction contracts unless the agency head determines that the exclusion of the clause is in the best interest of the State:
Regulation .09 Termination for Convenience.LinkCopy Citation
Mandatory provision for all construction contracts:
"Termination for Convenience of the State
“(1) The performance of work under this contract may be terminated by the State in accordance with this clause in whole, or from time to time in part, whenever the procurement officer shall determine that such termination is in the best interest of the State. Any such termination shall be effected by delivery to the Contractor of a Notice of Termination specifying the extent to which performance of work under the contract is terminated, and the date upon which such termination becomes effective.
“(2) After receipt of a Notice of Termination, and except as otherwise directed by the procurement officer, the Contractor shall:
Regulation .10 Performance and Payment Bonds.LinkCopy Citation
Mandatory provision for all construction contracts exceeding $100,000:
Regulation .11 Performance and Payment Bonds — Multiyear Annual and Renewable.LinkCopy Citation
For full text of Regulation 21.07.02.11, at end of chapter (FORM AT END OF CHAPTER)
Regulation .12 Payment of Employee Health Care Expenses.LinkCopy Citation
A.
The following is a mandatory provision for all State-funded construction contracts awarded after a competitive sealed bid:
Chapter 03. Mandatory Terms and Conditions for Purchase Orders Over $50,000
Regulation .01 General.LinkCopy Citation
The following are mandatory terms and conditions to be included in all purchase orders exceeding $50,000.
Regulation .01-1 Incorporation by Reference.LinkCopy Citation
“All terms and conditions of the solicitation, and any amendments thereto, are made a part of this contract.”
Regulation .02 Tax Exemption.LinkCopy Citation
“The State is generally exempt from federal excise taxes, Maryland sales and use taxes, District of Columbia sales taxes, and transportation taxes. Exemption certificates shall be completed upon request. Where a contractor is required to furnish and install material in the construction or improvement of real property in performance of a contract, the Contractor shall pay the Maryland sales tax and the exemption does not apply.”
Regulation .03 Specifications.LinkCopy Citation
“All materials, equipment, supplies or services shall conform to federal and State laws and regulations and to the specifications contained in the solicitation.”
Regulation .04 Delivery and Acceptance.LinkCopy Citation
“Delivery shall be made in accordance with the solicitation specifications. The State, in its sole discretion, may extend the time of performance for excusable delays due to unforeseeable causes beyond the Contractor's control. The State unilaterally may order in writing the suspension, delay, or interruption of performance hereunder. The State reserves the right to test any materials, equipment, supplies, or services delivered to determine if the specifications have been met. The materials listed in the bid or proposal shall be delivered FOB the point or points specified prior to or on the date specified in the bid or proposal. Any material that is defective or fails to meet the terms of the solicitation specifications shall be rejected. Rejected materials shall be promptly replaced. The State reserves the right to purchase replacement materials in the open market. Contractors failing to promptly replace materials lawfully rejected shall be liable for any excess price paid for the replacement, plus applicable expenses, if any.”
Regulation .05 Non-Hiring of Officials and Employees.LinkCopy Citation
“No official or employee of the State, as defined under State Government Article, §15-102, Annotated Code of Maryland, whose duties as such official or employee include matters relating to or affecting the subject matter of this contract shall, during the pendancy or term of this contract and while serving as an official or employee of the State, become or be an employee of the contractor or any entity that is a subcontractor on this contract.”
Regulation .06 Nondiscrimination in Employment.LinkCopy Citation
“The Contractor agrees not to discriminate in any manner against an employee or applicant for employment because of race, color, religion, creed, age, sex, sexual orientation, gender identity, marital status, national origin, ancestry, or physical or mental disability of a qualified individual with a disability and to post and to cause subcontractors to post in conspicuous places available to employees and applicants for employment, notices setting forth the substance of this clause.”
Regulation .07 Financial Disclosure.LinkCopy Citation
“The Contractor shall comply with State Finance and Procurement Article, §13-221, Annotated Code of Maryland. That section requires a business to file with the Secretary of State of Maryland certain specified information, including disclosure of beneficial ownership of the business, within 30 days of the date the aggregate value of any contracts, leases, or other agreements that the business enters into with the State of Maryland or its agencies during a calendar year reaches $200,000.”
Regulation .08 Political Contribution Disclosure.LinkCopy Citation
“The Contractor shall comply with the political contribution reporting requirements to which the contractor may be subject under Election Law Article, Title 14, Annotated Code of Maryland. That title includes requirements for persons making or having a single contract with a single governmental entity involving cumulative consideration of at least $200,000 to file certain statements with the State Board of Elections both before the execution of such contracts by that governmental entity and periodically thereafter; and further requires the governmental entity to require such persons to certify that they have filed such statements. Additional information is available on the State Board of Elections website.”
Regulation .09 Anti-Bribery.LinkCopy Citation
“The Contractor warrants that neither it nor any of its officers, directors, or partners nor any of its employees who are directly involved in obtaining or performing contracts with any public body has been convicted of bribery, attempted bribery, or conspiracy to bribe under the laws of any state or of the federal government or has engaged in conduct since July 1, 1977, which would constitute bribery, attempted bribery, or conspiracy to bribe under the laws of any state or the federal government.”
Regulation .10 Registration.LinkCopy Citation
“Pursuant to §7-201 et seq. of the Corporations and Associations Article of the Annotated Code of Maryland, corporations not incorporated in the State shall be registered with the State Department of Assessments and Taxation, 301 West Preston St., Baltimore, Maryland 21201, before doing any interstate or foreign business in this State. Before doing any intrastate business in this State, a foreign corporation shall qualify with the Department of Assessments and Taxation.”
Regulation .11 Contingent Fees.LinkCopy Citation
“The Contractor warrants that it has not employed or retained any person, partnership, corporation, or other entity, other than a bona fide employee or agent working for the Contractor, to solicit or secure this agreement, and that it has not paid or agreed to pay any person, partnership, corporation, or other entity, other than a bona fide employee or agent, any fee or any other consideration contingent on the making of this agreement.”
Regulation .12 EPA Compliance.LinkCopy Citation
“Materials, supplies, equipment, or services shall comply in all respects with the Federal Noise Control Act of 1972, where applicable.”
Regulation .13 Occupational Safety and Health Act (O.S.H.A.).LinkCopy Citation
“All materials, supplies, equipment, or services supplied as a result of this contract shall comply with the applicable U. S. and Maryland Occupational Safety and Health Act standards.”
Regulation .14 Termination for Convenience.LinkCopy Citation
“Upon written notice to the Contractor, the State may terminate this contract, in whole or in part, whenever the State shall determine that such termination is in the best interest of the State. The State shall pay all reasonable costs incurred up to the date of termination and all reasonable costs associated with termination of the contract. However, the Contractor may not be reimbursed for anticipatory profits. Termination hereunder, including the determination of the rights and obligations of the parties, shall be governed by the provisions of COMAR 21.07.01.12A(2).”
Regulation .15 Termination for Default.LinkCopy Citation
“When the Contractor has not performed or has unsatisfactorily performed the contract, payment shall be withheld at the discretion of the State. Failure on the part of a Contractor to fulfill contractual obligations shall be considered just cause for termination of the contract and the Contractor is not entitled to recover any costs incurred by the Contractor up to the date of termination. Termination hereunder, including the determination of the rights and obligations of the parties, shall be governed by the provisions of COMAR 21.07.01.11B.”
Regulation .16 Disputes.LinkCopy Citation
“This contract shall be subject to the provisions of Title 15, Subtitle 2, of the State Finance and Procurement Article of the Annotated Code of Maryland and COMAR 21.10 (Administrative and Civil Remedies). Pending resolution of a claim, the Contractor shall proceed diligently with the performance of the contract in accordance with the procurement officer's decision.”
Regulation .17 Multi-Year Contracts.LinkCopy Citation
“If funds are not appropriated or otherwise made available to support continuation in any fiscal year succeeding the first fiscal year, this contract shall terminate automatically as of the beginning of the fiscal year for which funds are not available. The Contractor may not recover anticipatory profits or costs incurred after termination.”
Regulation .18 Intellectual Property.LinkCopy Citation
“Contractor agrees to indemnify and save harmless the State, its officers, agents and employees with respect to any claim, action, cost or judgment for patent infringement, or trademark or copyright violation arising out of purchase or use of materials, supplies, equipment or services covered by this contract.”
Regulation .19 Maryland Law Prevails.LinkCopy Citation
“The provisions of this contract shall be governed by the laws of Maryland.”
Regulation .20 Contractor's Invoices.LinkCopy Citation
“Contractor agrees to include on the face of all invoices billed to the State, its Taxpayer Identification Number, which is the Social Security Number for individuals and sole proprietors and the Federal Employer Identification Number for all other types of organizations.”
Regulation .21 Pre-existing Regulations.LinkCopy Citation
“The regulations set forth in Title 21 of the Code of Maryland Regulations (COMAR Title 21) in effect on the date of execution of this Contract are applicable to this Contract.”
Regulation .22 Repealed.LinkCopy Citation
Regulation .23 Indemnification.LinkCopy Citation
“The State shall not assume any obligation to indemnify, hold harmless, or pay attorneys' fees that may arise from or in any way be associated with the performance or operation of this agreement.”
Regulation .24 Conflicting Terms.LinkCopy Citation
“Any proposal for terms in addition to or different from those set forth in this purchase order or any attempt by the Contractor to vary any of the terms of this offer by Contractor's acceptance shall not operate as a rejection of this offer, unless such variance is in the terms of the description, quantity, price or delivery schedule, but shall be deemed a material alteration thereof, and this offer shall be deemed acceptable by the Contractor without the additional or different terms. If this purchase order is an acceptance of a prior offer by the Contractor, the acceptance is expressly conditioned upon Contractor's assent to any additional or different terms contained herein. The Contractor understands and agrees that the terms and conditions of this purchase order may not be waived.”
Regulation .25 Drug and Alcohol Free Workplace.LinkCopy Citation
“The contractor warrants that the contractor shall comply with COMAR 21.11.08, and that the contractor shall remain in compliance throughout the term of this purchase order.”
Regulation .26 Commercial Nondiscrimination Clause.LinkCopy Citation
A.
The following provision is mandatory for all State contracts: “As a condition of entering into this Agreement, Contractor represents and warrants that it will comply with the State's Commercial Nondiscrimination Policy, as described under State Finance and Procurement Article, Title 19, Annotated Code of Maryland. As part of this compliance, Contractor may not discriminate on the basis of race, color, religion, ancestry or national origin, sex, age, marital status, sexual orientation, gender identity, or disability or other unlawful forms of discrimination in the solicitation, selection, hiring, or commercial treatment of subcontractors, vendors, suppliers, or commercial customers, nor shall Contractor retaliate against any person for reporting instances of such discrimination. Contractor shall provide equal opportunity for subcontractors, vendors, and suppliers to participate in all of its public sector and private sector subcontracting and supply opportunities, provided that this clause does not prohibit or limit lawful efforts to remedy the effects of marketplace discrimination that have occurred or are occurring in the marketplace. Contractor understands that a material violation of this clause shall be considered a material breach of this Agreement and may result in termination of this Agreement, disqualification of Contractor from participating in State contracts, or other sanctions. This clause is not enforceable by or for the benefit of, and creates no obligation to, any third party.”
B.
The Contractor shall include the provision in §A of this regulation in all subcontracts to the State contract.
C.
The following provision is mandatory for all State contracts: “As a condition of entering into this Agreement, upon the request of the Commission on Civil Rights, and only after the filing of a complaint against Contractor under State Finance and Procurement Article, Title 19, Annotated Code of Maryland, as amended from time to time, Contractor agrees to provide within 60 days after the request a complete list of the names of all subcontractors, vendors, and suppliers that Contractor has used in the past 4 years on any of its contracts that were undertaken within the State of Maryland, including the total dollar amount paid by Contractor on each subcontract or supply contract. Contractor further agrees to cooperate in any investigation conducted by the State pursuant to the State's Commercial Nondiscrimination Policy as set forth under State Finance and Procurement Article, Title 19, Annotated Code of Maryland, and to provide any documents relevant to any investigation that is requested by the State. Contractor understands that violation of this clause is a material breach of this Agreement and may result in contract termination, disqualification by the State from participating in State contracts, and other sanctions.”
Regulation .27 Prompt Payment of Subcontractors.LinkCopy Citation
Mandatory provisions for all contracts:
A.
This contract and all subcontracts issued under this contract at any tier are subject to the provisions of State Finance and Procurement Article, §15-226, Annotated Code of Maryland, and COMAR 21.10.08. In §§A—D of this regulation, the terms “undisputed amount”, “prime contractor”, “contractor”, “subcontractor,” and “supplier” have the meanings stated in COMAR 21.10.08.01.
B.
A contractor shall promptly pay its subcontractors or suppliers an undisputed amount to which a subcontractor or supplier is entitled for work performed under this contract within 10 days after the contractor receives a progress payment or final payment for work under this contract.
C.
If a contractor fails to make payment within the period prescribed in §B of this regulation, a subcontractor or supplier may request a remedy in accordance with COMAR 21.10.08.
D.
A contractor shall include in its subcontracts at any tier for work under this contract, wording that incorporates the provisions, duties, and obligations of §§A—D of this regulation, State Finance and Procurement Article, §15-226, Annotated Code of Maryland, and COMAR 21.10.08.
Chapter 04. Prohibited Provisions
Regulation .01 Definitions.LinkCopy Citation
A.
In this chapter, “State contract” means any agreement entered into by the State.
B.
This section does not apply to a State contract relating to the purchase, redevelopment, or operation of a racing facility or training facility site as those terms are defined under Economic Development Article, §10–601, Annotated Code of Maryland.
Regulation .02 Contract Prohibitions.LinkCopy Citation
A.
Except as required by State or federal law, a State contract may not include the following:
(1)
A provision that requires the State to indemnify, defend, or hold harmless another person without an appropriation of State funds for that purpose;
(2)
A provision by which the State agrees to binding arbitration or any other binding extrajudicial dispute resolution process;
(3)
A provision that names a jurisdiction or venue for any action or dispute against the state other than a court of proper jurisdiction in the State;
(4)
A provision that requires the state to agree to limit the liability for any direct loss to the State for bodily injury, death, or damage to property of the State caused by the negligence, intentional or willful misconduct, fraudulent act, recklessness, or other tortious conduct of a person or a person’s employees or agents or a provision that would otherwise impose an indemnification obligation on the State;
(5)
A provision that requires the State to be bound by a term or condition that:
(a)
Is unknown to the State at the time of signing a contract;
(b)
May be unilaterally changed by the other party; or
(c)
Is electronically accepted by a State employee without authority;
(6)
A provision that provides for a person other than the Attorney General of Maryland to serve as legal counsel for the State, unless provided under State Government Article, §6–106, Annotated Code of Maryland;
(7)
A provision that is inconsistent with the State’s obligations under General Provisions Article, §§3 or 4, Annotated Code of Maryland;
(8)
A provision prohibited under State Finance and Procurement Article, §7–237, Annotated Code of Maryland;
(9)
A provision for automatic renewal that obligates the State to allocate funding in subsequent fiscal years; or
(10)
A provision that limits the State’s ability to recover the cost of a replacement contractor.
B.
If a State contract contains a provision listed under §A. of this regulation, the provision is void from the beginning and the contract containing that provision shall be enforceable as if it did not contain the provision.
C.
A State contract that contains a provision listed under §A of this regulation shall be governed by and construed in accordance with State law, notwithstanding any term or condition to the contrary in the contract.