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 annotations
Authority: Election Law Article, §§14-101—14-108; General Provisions Article, §§5-502—5-503; State Finance and Procurement Article, §§12-101, 13-217—13-219, 13-221, 15-226, 16-202, 17-401, and 17-402; Annotated Code of Maryland; Ch. 630, Acts of 2017
History: Effective date: July 1, 1981 (8:13 Md. R. II-5)
History: Chapter recodified from COMAR 21.07.04 to 21.07.03 and revised effective January 9, 1989 (15:27 Md. R. 3138)
History: Regulation .01 recodified to Regulation .01-1 and new Regulation .01 adopted effective January 26, 1998 (25:2 Md. R. 79)
History: Regulation .01 amended effective June 29, 2020 (47:13 Md. R. 643)
History: Regulation .05 amended effective October 2, 2000 (27:19 Md. R. 1730); July 9, 2001 (28:13 Md. R. 1216)
History: Regulation .06 amended effective December 25, 2000 (27:25 Md. R. 2284); March 3, 2025 (52:4 Md. R. 221)
History: Regulation .07 amended effective March 11, 2019 (46:5 Md. R. 310)
History: Regulation .08 amended effective January 26, 1998 (25:2 Md. R. 79) December 25, 2000 (27:25 Md. R. 2284); March 11, 2019 (46:5 Md. R. 310)
History: Regulation .09 amended effective August 2, 1993 (20:15 Md. R. 1221)
History: Regulations .14 and .15 amended effective November 22, 1993 (20:23 Md. R. 1806)
History: Regulation .20 amended effective August 2, 1993 (20:15 Md. R. 1221)
History: Regulation .22 amended effective August 2, 1993 (20:15 Md. R. 1221)
History: Regulation .22 repealed effective November 20, 1994 (21:23 Md. R. 1936)
History: Regulation .25 adopted effective October 1, 1990 (17:19 Md. R. 2322)
History: Regulation .26 adopted as an emergency provision effective August 8, 1997 (24:18 Md. R. 1294); emergency status rescinded effective October 16, 1997 (24:23 Md. R. 1608)
History: Regulation .26 adopted effective April 7, 2008 (35:7 Md. R. 751)
History: Regulation .26A amended effective March 3, 2025 (52:4 Md. R. 221)
History: Regulation .26C amended effective March 5, 2012 (39:4 Md. R. 338)
History: Regulation .27 adopted effective September 18, 2023 (50:18 Md. R. 800)
History: Regulation .27 amended effective March 3, 2025 (52:4 Md. R. 221)