Code of Maryland Regulations
Chapter 05.04.01 - Maryland Housing Rehabilitation Program - Regular Rehabilitation Program - Contractor Requirements

Universal Citation: MD Code Reg Contractor Requirements

A. General Requirements. Contractors and subcontractors:

(1) Shall be licensed by the Maryland Home Improvement Commission or meet other State and local licensing requirements necessary to do the rehabilitation.

(2) Shall be qualified to do business in Maryland.

(3) Shall be able to demonstrate the capability to complete the rehabilitation as determined by the Department as evidenced by previous professional rehabilitation experience.

(4) May not be under a suspension or debarment order for any of the Department's programs pursuant to any action under COMAR 05.01.05.

(5) Shall agree in the contract to:

(a) Perform all work in conformance with the contract and all applicable laws, local codes, and Departmental rehabilitation standards in a competent, workman-like manner, equal to the standards of the industry. Failure of the work write-up to include any work required by local codes or standards does not relieve the contractor of the responsibility of complying with local codes and standards. Payment for any additional cost to complete work not included in the approved work write-up is the obligation of the borrower. A borrower may apply to the local administrator for a loan increase to cover some or all of the increased cost. Any loan increase shall be subject to approval or disapproval in accordance with the provisions of these Regulations . The Department has no obligation under the contract to pay for increased costs.

(b) Comply with all applicable laws, ordinances, and regulations relating to the protection and safety of persons and property.

(c) Furnish all labor, materials, and equipment, and obtain all licenses, permits, insurance coverage, and workers' compensation as may be required to complete the rehabilitation.

(d) Not assign the contract without prior written consent of the owner and approval by the local administrator.

(e) In addition to all remedies and guarantees provided by law, make all necessary repairs, replacements, and corrections of any nature or description, interior or exterior, structural or nonstructural, as become necessary by reason of faulty workmanship or material, which appear within a period of 1 year from the date the notice of completion is filed, at its sole cost and expense, provided, however, that if any longer guarantee period is specified for any particular materials or workmanship under the plans and specifications, or under any subcontract, or in connection with any manufactured unit which is installed in the structure, or under the laws of the State, the longer period governs.

(f) Agree to complete all specifications of the work write-up within the completion date as specified in the contract.

(6) Shall indemnify and hold the Department and any local administrator harmless from all liability and loss because of injury to or death of any individual or damage to any property which may occur or be alleged to occur during performance of the contract as a direct or indirect result of any act or omission, whether intentional, negligent or otherwise, by the contractor, subcontractors, or their agents, servants, and employees. The contractor shall defend all suits or claims involving those in this subsection at the contractor's sole cost and expense.

B. Minority Contractors. The Department encourages the use of minority contractors in all jurisdictions for all projects, and requires compliance with the Department's Minority Business Participation Plan. Copies of the Department's plan shall be made available to sponsors and contractors.

C. Identity of Interest.

(1) Sponsors or nonprofit sponsors may act as general contractors only with the prior written approval of the Department or the local administrator. Application forms shall be provided upon request and shall be submitted and approved before submission of the proposal. Approval is conditioned on an assurance of completion acceptable to the Department.

(2) An owner-occupant may not act as a general contractor.

D. Assurance of Completion. The Department or the local administrator, at its discretion, may require:

(1) Performance and payment bonds;

(2) A letter of credit in the amount of 25 percent of the rehabilitation contract cost and an assurance of completion agreement; or

(3) Other assurances of completion acceptable to the Department.

E. It shall be agreed by both the contractor and the owner that all communications which bear upon the content or performance of the contract shall be in writing.

F. Contractors performing work covered by a rehabilitation loan may not be on the unacceptable risk determination list of the Department of Housing and Urban Development or the United States Department of Agriculture Rural Development, and any previous experience with the Program shall have been satisfactory. Contractors that do not perform up to program requirements may be suspended or debarred under COMAR 05.01.05.

(Regulations .13 amended effective February 11, 1985 (12:3 Md. R. 243)
Regulations .13 adopted effective July 22, 1991 (18:14 Md. R. 1609)
Regulations .13 amended effective November 9, 1992 (19:22 Md. R. 1986))
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