search, or in the case of an application for a Part D grant, that it is authorized to conduct the research and engage in the activities related to mental retardation, described in the application and related documents.

(c) Upon a further determination, and in the case of an application for a grant for construction of a health research facility under Part A of Title VII of the Act, after consultation with the Council, that the institution is competent to engage in the type of research for which the facility is to be constructed, taking into consideration among other pertinent factors:

(1) The scientific or professional standing or reputation of the institution and of its existing or proposed officers and research staff;

(2) The availability, by affiliation or other association, of other scientific or health personnel and facilities to the extent necessary to provide effective opportunities for the type of research proposed.

§ 57.3 Application for

grants.

construction

No construction grant shall be made unless an application is filed therefor in the form and manner prescribed by the Surgeon General and is executed by an official or officials legally authorized by the applying agencies, corporations, or associations to make on their behalf such application and to provide the required assurances. In addition to any other pertinent information which the Surgeon General may require, each applicant shall:

(a) Furnish in sufficient detail plans and specifications of the facility to be constructed so as to indicate the nature and purpose of all portions of the facility and the type and quality of any features bearing on the major costs of construction;

(b) Set forth in detail the estimated total costs of construction of the facility and the basis on which such estimate was made;

(c) Furnish information on the extent and manner in which the proposed construction will expand the applicant's capacity for research or is necessary to improve or maintain the quality of such research by the applicant.

§ 57.4 Required assurances.

No construction grant shall be made unless the application therefor contains

or is supported by assurances, found by the Surgeon General to be reasonable:

(a) That for not less than 10 years after completion of construction, or in the case of a Part D grant, that for not less than 20 years after completion of construction, the facility will be used for the research for which it is to be constructed. Such an assurance shall be supported by evidence indicating the applicant's ownership of, or right otherwise to occupy, the site and to control the use of the facility for such period.

(b) That sufficient funds will be available to meet the non-Federal share of the cost of constructing the facility. Such assurance shall be supported by evidence of the amount of funds in escrow or firmly pledged or of funds or fund sources specifically earmarked for such purpose, or other such evidence indicating that funds for the non-Federal share are available: Provided, That if the applicant for a Part A grant is unable to give the assurances as required by this paragraph, the grant may be made notwithstanding on such terms and conditions as prescribed by the Surgeon General after consultation with the Council and on the specific condition that such assurances, together with supporting evidence, will be furnished by the applicant within six months after such conditional grant or within such other period as determined by the Surgeon General after such consulation; and

(c) That sufficient funds will be available when construction is completed for effective use of the facility for the research for which it is being constructed. Such an assurance shall be supported as to new facilities by a proposed operating budget indicating the amount and source of operating funds for a 2-year period immediately following completion of construction or, as to existing facilities, by a statement of the amount and source of funds that are or will be available for such 2-year period to meet any difference between proposed expenditures and anticipated income.

§ 57.5 Approval of grants.

The Council shall recommend, and the Surgeon General shall approve, construction grants only for those proposed facilities which in their judgment will be the more effective in expanding capacity for research, in improving the quality of such research, and in promoting an equitable geographical distribution of

(c)

such research. In so recommending or approving, particular consideration shall be given to facilities that: (a) Will be used for research in disciplines or diseases or aspects of a disease which have the most urgent needs; (b) are adaptable to various methods by which research is organized or advanced; will be in institutions or localities with broad research programs and potentials; (d) will promote a better geographic distribution of research through assistance to established or promising new facilities in various areas of the Nation having at present relatively few such research facilities.

§ 57.6

Amount of grant; limitation.

Subject to the maximum amounts prescribed in the Act, the amount of any grant shall be that recommended by the Council or such lesser amount as the Surgeon General deems to be appropriate: Provided, That the amount of a grant for construction of a mental retardation center shall be determined by the Surgeon General. Such an amount shall be reserved from any available appropriation, but the amount so reserved may be amended from time to time either upon a revision by the Surgeon General of his estimate of the necessary cost of construction or upon the Surgeon General's approval of an amendment to the application. § 57.7

Necessary costs of construction.

In determining the necessary costs of construction of any facility, the Surgeon General, in addition to other relevant considerations, shall exclude:

(a) The value of any donation or gift of services, materials, or equipment;

(b) The cost of any services, materials, or equipment not reasonably required by the plans and specifications furnished under § 57.3, or approved amendments thereto, and any costs occasioned by special architectural or designed features or the use of special materials not necessary for the conduct of the proposed research program;

(c) The cost of any portion of the facility that is not completed to a sufficient extend that it can be used for the proposed research program, and any architectural or other services specifically related thereto;

(d) The cost of any space or equipment to the extent it is related to purposes other than research;

In addition to any other conditions imposed by law or determined by the Surgeon General to be reasonably necessary to fulfill the purpose of the grant, each construction grant shall be subject to the following terms, conditions, and assurances to be furnished by the grantee. The Surgeon General may at any time approve exceptions to these terms, conditions, and assurances where he finds that such exceptions are not inconsistent with the Act and the purposes of the program.

(a) All construction shall be permanent construction, designed to effectively carry out the proposed research program and shall be fire safe and structually safe. Compliance with the minimum standards specified in § 57.109 may be deemed to be compliance with the requirement stated herein.

(b) Use grant funds solely for the purposes of the construction for which the grant was made.

(c) Use no part of the grant funds for any cost with respect to services performed or material or equipment delivered, at any time, pursuant to a contract or agreement entered into by the applicant prior to the effective date of the construction grant.

(d) (1) That any laborer or mechanic employed by any contractor or subcontractor in the performance of work on the construction of the facility will be paid wages at rates not less than those prevailing on similar construction in the locality as determined by the Secretary of Labor in accordance with the Davis

Bacon Act (40 U.S.C. 276 et seq.), and will receive compensation at a rate not less than one and one-half times his basic rate of pay for all hours worked in any work week in excess of eight hours in any calendar day or 40 hours in the work week(Contract Work Hours Standard Act, 40 U.S.C. 327-332); and

(2) That the following conditions and provisions will be included in all construction contracts:

(i) The provision set forth in "Labor Standards for United States Public Health Service Construction Grant Programs" (PHS No. 930-A-5) pertaining to the Copeland Act (Anti-Kickback) Regulations and Labor Standards (prevailing rates of pay and overtime requirements) except in the case of contracts in the amount of $2,000 or less;

(ii) The contractor shall furnish performance and payment bonds in the full amount of the contract price, and shall maintain, during the life of the contract, adequate fire, workmen's compensation, public liability, and property damage insurance;

(iii) Representatives of the Public Health Service and such other persons as the Surgeon General may designate will have access at all reasonable times to work wherever it is in preparation or progress, and the contractor shall provide proper facilities for such access and inspection.

(e) Maintain such fiscal or other records and furnish such progress or other reports relating to the construction as may be directed by the Surgeon General, and permit audit of records and inspection of the site and of the construction in progress at any reasonable time by representatives of the Surgeon General;

(f) Repay to the United States the amount of any grant funds found by the Surgeon General to have been used contrary to law, to these regulations or to the conditions to the grant, and any amount paid in excess of the maximum prescribed in these regulations.

(g) The grantee shall comply with the requirements of, and give the assurances required in, Executive Order 11114, June 22, 1963 (28 F.R. 6485), and the applicable rules, regulations, and procedures prescribed pursuant thereto by the President's Committee on Equal Employment Opportunity (28 F.R. 9812).

(h) Perform actual construction work by the lump sum (fixed price) contract

method; employ adequate methods of obtaining competitive bidding prior to awarding the construction contract, either by public advertising or circularizing three or more bidders; and award the contract to the responsible bidder submitting the lowest acceptable bid.

(i) Enter into no construction contract or contracts for the project or a part thereof, the cost of which is in excess of the estimated cost approved in the application for that portion of the work covered by the plans and specifications, without the prior approval of the Surgeon General:

(j) Finance all costs in excess of the estimated costs approved in the application and submit to the Surgeon General for prior approval changes that substantially alter the scope of work, function, utilities, or safety of the facility.

§ 57.10 Good cause for other use of completed facility.

If within 10 years after completion of any construction for which a grant has been made, or in the case of a Part D grant, 20 years, the facility shall cease to be used for the research purposes for which it was constructed, the Surgeon General in determining whether there is good cause for releasing the applicant or other public or nonprofit owner from the obligation so to use the facility, shall take into consideration, among other similar factors, the extent to which:

(a) The facility will be devoted by the applicant or other public or nonprofit owner to other research in the sciences related to health or to other health purposes, taking into consideration, in the case of a mental retardation research facility, the extent to which the facility will be devoted to research related to mental retardation;

(b) The circumstances calling for a change in the use of the facility were not known, or with reasonable diligence could not have been known to the applicant, at the time of the application, and are circumstances reasonably beyond the control of the applicant or other owner; and

(c) There are reasonable assurances that for the remainder of the period other facilities not previously utilized for such research will be so utilized and are substantially the equivalent in nature and extent for such purposes.

a

(d) "Construction grant" means grant of funds for the construction of teaching facilities as authorized by Part B of Title VII of the Act.

(e) "Construction" as defined in section 724 (1) of the Act includes those repairs to an existing building, excluding routine maintenance, which restore the building to a sound state, and the cost of which is no less than $100,000.

(f) "Equipment" means those items which are necessary for the functioning of the facility but does not include items of current operating expense such as food, fuel, drugs, dressings and paper, or books, pamphlets and related matter.

(g) "Multipurpose facilities" means facilities which are primarily (as determined in accordance with § 57.102(e) for teaching purposes but which are also for research, or research and related purposes, in the sciences related to health (within the meaning of Part A of Title VII of the Act) and/or for medical library purposes (within the meaning of Part I of Title III of the Act).

(h) "New school" means a school from which, at the time of filing an application for a construction grant, no class has been graduated because of an insufficient period of operation.

(i) "Council" means the National Advisory Council on Education for Health Professions (established by section 725 of the Act).

(a) Meet the requirements of section 721 of the Act;

(b) Be located in a State, the District of Columbia, Puerto Rico, or the Virgin Islands.

(c) Except in the case of an application with respect to an affiliated hospital, be accredited by a recognized body or bodies approved for such purpose by the Commissioner of Education, except that a new school which (by reason of no, or an insufficient period of operation) is not, at the time of making application for the construction grant, eligible for accreditation by such recognized body or bodies shall be deemed accredited for purposes of receiving a grant if the Commissioner finds, after consultation with the appropriate accreditation body or bodies, that there is reasonable assurance that the school, after completion of the facility and at or prior to the time of graduation of the first class to use such facility, will have met the accreditation standards of such body or bodies; and

(d) In the case of an application with respect to an affiliated hospital, have a written agreement with an accredited school of medicine or a school of osteopathy providing for effective control by the school of the teaching in the hospital.

(e) In the case of an application with respect to the construction of multipurpose facilities, such application must be for the construction of facilities which are determined by the Secretary to be primarily for teaching purposes and for which a grant may otherwise be made under Part B of Title VII of the Act. The Secretary may determine to be primarily for teaching purposes any facilities with respect to which he determines that the health professions teaching portion of such facilities, including research and library space essential for teaching purposes, will substantially exceed the total of the research and library portions which are not essential for teaching, taken together.

the applicant to make efficient and productive use of the facility constructed. § 57.104 Percentage of participation; amount of construction grant.

(a) Percentage of participation. (1) The amount of the construction grant may not exceed 50 per centum of the necessary cost of construction except that (i) in the case of a project for a new school or for major expansion of training capacity of an existing school in accordance with subparagraph (2) of this paragraph, such grant may not exceed 66 percent of such cost; (ii) in the case of a project for a school of public health, it may not exceed 75 per centum of such cost; and (iii) with respect to appropriations for fiscal years ending after June 30, 1969, in the case of any other grant where the Secretary determines in the particular case that unusual circumstances make a percentage larger than 50 per centum (which in no case may exceed 663 per centum) of such cost necessary in order to increase the enrollment of students in the health professions or to prevent the curtailment of such enrollment.

(2) For purposes of this paragraph a major expansion of training capacity of an existing school occurs or will occur when the Secretary determines, on the basis of such information or assurances as he may require, that the first-year enrollment at such a school for each of the 10 full school years after the completion of the construction will exceed the highest first-year enrollment at such school for any of the 5 full school years preceding the year in which the application is made by at least 20 per centum of such highest first-year enrollment, or by 20 students, whichever is greater: Provided, however, That where the Secretary finds, with respect to a particular school, that such increased enrollment cannot be achieved until the second or third full school year after completion of construction he may determine that the requirements for a major expansion of training capacity are met if during the first or second full school year after completion of construction the increased first-year enrollment will equal such amount in excess of 5 percent or five students, whichever is greater, as the Secretary may specify.

(b) Amount of construction grantless than maximum. In determining the extent to which less than the maximum allowable construction grant may be

(a) Executive Order 11246. Each construction grant is subject to the condition that the grantee shall comply with the requirements of Executive Order 11246, September 24, 1965 (30 F.R. 12319), relating to nondiscrimination in construction contract employment, and the applicable rules, regulations, and procedures prescribed pursuant thereto (see 57.106(p) (2) (i)).

(b) Civil Rights Act of 1964. Attention is called to the requirements of Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d; 78 Stat. 252), which provides that no person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance. A regulation implementing such Title VI, applicable to grants for construction of teaching facilities, has been issued by the Secretary of Health, Education, and Welfare with the approval of the President (45 CFR Part 80). § 57.106 Terms and conditions.

In addition to any other requirements imposed by law or determined by the Secretary to be reasonably necessary with respect to particular projects to fulfill the purpose of the grant, each construction grant shall be subject to the condition that the applicant will furnish and comply with the following assurances. The Secretary may at any time approve exceptions to these terms and conditions where he finds that such exceptions are not inconsistent with the Act and purposes of the program:

(a) That applicant has a fee simple or such other estate or interest in the site, including necessary easements and rights-of-way, sufficient to assure for a period of not less than 20 years undisturbed use and possession for the purpose of the construction and operation of the facility;

(b) That the Secretary's approval of the final working drawings and specifications, which conform to the minimum standards of construction and equipment (§ 57.108), will be obtained before the project is advertised or placed on the market for bidding;