RUS-236 Engineering Service Contract Electric

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ENGINEERING SERVICE CONTRACT
ELECTRIC SYSTEM DESIGN AND CONSTRUCTION
AGREEMENT, made

,

, between

(hereinafter called the ''Owner") and
hereinafter called the "Engineer").

of

WHEREAS, the Owner has obtained loans made or guaranteed by the United States of America, acting
through the Administrator of the Rural Utilities Service (hereinafter called the ''Administrator"), to finance in whole
or in part a rural electric system pursuant to the Rural Electrification Act of 1936, as amended, and plans the
construction of a project designated
, being hereinafter called the ''Project,'' consisting of
approximately the following facilities:
Distribution and Transmission Lines:
miles (

km) of

kV line,

miles (

km) of

kV line,

Substations:
Name

MVA

kV to

kV

MVA

kV to

kV

Switching Stations:
Name

kV
kV

Other:
miles (

km) of line conversion,

miles (

km) of line

removal, and the following:
NOW, THEREFORE, in consideration of the mutual undertakings herein contained, the parties hereto
agree as follows:

ARTICLE I
General Obligations
In accordance with the normal standards and practices used in the profession, the Engineer shall render
diligently and competently all engineering services which shall be necessary or advisable for the expeditious,
economical, and sound design and construction of the Project, with due consideration given to applicable
ecological and environmental requirements. The enumeration of specific duties and obligations to be performed by
the Engineer hereunder shall not be construed to limit the general undertakings of the Engineer.

RUS FORM 236 (Rev. 6-98)

ARTICLE II
Preconstruction Period
Section 1. The Engineer shall give thorough consideration to aesthetics and the protection of the
environment in all phases of construction of the Project, including line routing and station locations. Where RUS
or the Owner has prepared an environmental document or the Owner must comply with the conditions of a Special
Use Permit imposed by a Federal land management agency, the Engineer shall incorporate all environmental
commitments of the applicable documents that specifically relate to the facilities to be constructed.
Section 2. The Engineer shall, within thirty (30) days after the date of execution of this Agreement, make a
complete field inspection and investigation for the purpose of determining the most economical and practicable
location of the proposed lines.
The Engineer shall cooperate with the Owner's right-of-way agent and attorney in developing a schedule
of right-of-way procurement and assist the Owner in developing suitable property maps for use by the Owner's
easement solicitors.
Section 3. Prior to the preparation of Plans and Specifications by the Engineer, the Owner shall furnish to
the Engineer the following as may be applicable:
(a) Copies of pertinent Engineering Studies, including Construction Work Plans when available, on
which to base the design of the electrical facilities to be built; key maps of the Owner's present and proposed
facilities and detail or vicinity maps showing location of existing lines, consumers served, and easements
obtained..
(b) Detailed lists of materials, if any, on hand or on order which are to be furnished by the Owner in
the construction of the Project, together with the quantity and the value of each item of such material.
(c) With respect to materials contained in the assembly units indicated for removal, a list showing
values of individual material items for which the Contractor will be credited with respect to salvaged materials
returned to the Owner if not included in item (b) above.
Section 4. Sufficient soil test data to ensure adequate foundation designs shall be provided by the
Owner
the Engineer [check one].
Section 5. If requested by the Owner, the Engineer shall prepare and submit to the Owner estimates of
quantities of materials to be furnished by the Owner for use in connection with the construction of the Project. The
Engineer shall procure and submit to the Owner forms of contracts and other documents for such materials and for
such other services as may be necessary or desirable in connection with the construction of the Project.
Section 6. For transmission lines, the Engineer shall prepare and submit to the Owner for approval and to
the Administrator for approval, if approval of the Administrator is required, a summary of transmission line and
substation design data with supporting calculations. The Plans and Specifications and the Plan and Profile, if any,
shall be based on the design data approved by the Owner and by the Administrator, if approval of the Administrator
is required.
Section 7. The Engineer shall prepare and submit to the Owner for approval and to the Administrator for
approval, if approval of the Administrator is required, plan and profile sheets for all transmission lines.
Section 8. In specifying right-of-way clearing for transmission lines where "feathering" and/or undulating
boundaries are required, the Engineer shall mark all brush and trees to be removed unless such marking is the
responsibility of another authority. The Engineer shall also compute all clearing units, and show all clearing units
on the plan and profile drawings or on separate drawings prepared for this purpose.

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2

Section 9. The Engineer shall prepare, and within
days after the date of execution of this
Agreement, submit to the Owner for approval and to the Administrator for approval, if approval of the
Administrator is required, two copies of complete and detailed plans and specifications, drawings, maps, and other
documents required for the construction of the Project (all of the foregoing being hereinafter collectively called the
''Plans and Specifications"). In the preparation of the Plans and Specifications, the Engineer shall consult with the
Owner to the end that the Project shall serve the purpose intended by the Owner. Unless otherwise directed by the
Owner, the Engineer shall use Construction Work Plans and Engineering Studies, as furnished by the Owner, as a
basis for the preparation of the Plans and Specifications. The Engineer shall diligently make such changes in the
Plans and Specifications as may be required by the Owner or the Administrator as a condition of approval thereof.
Section 10. The Engineer shall, for each substation, prepare and furnish for the Owner's approval and for
the Administrator's approval, if approval of the Administrator is required, the following drawings and such others
as may be necessary or desirable for the construction of the Project:
One line diagram (relays, breakers, transformers, switches, etc.)
Three line diagram (PT, CT, phasing, etc.)

Plot plan (excluding land surveys and plots necessary in acquisition of property)
Grading plan, fence layout and details
Structure plan and details
Structure elevations (with section views)
Footing plan and details
Grounding plan and details
Cable trench and layout plan
Lighting plan and details
Control house plan and details
Control house elevations and details
Material lists

Section 11. All maps, drawings, plan and profile sheets, plans and specifications, contract forms,
addenda, estimates, studies, and other documents required to be prepared or submitted by the Engineer under this
Article II or other articles of this Agreement shall conform to the applicable standard specifications and other forms
prescribed by the Administrator, unless deviation therefrom shall have been approved by the Administrator.
Section 12. The Engineer shall furnish to the Owner all engineering information, data, and drawings
required for procuring all necessary or desirable permits, licenses, franchises, and authorizations from public
bodies, and all necessary or desirable permits, licenses, or agreements with respect to the crossing of navigable
streams, railroads, and power lines, and with respect to the paralleling or crossing of communications lines and
signal circuits, and shall assist the Owner to the extent necessary to obtain such permits, licenses, franchises,
authorizations, and agreements. The Engineer shall also furnish to the Owner all engineering information, data, and
drawings required for procuring transmission line right-of-way through condemnation proceedings. If

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RUS FORM 236 (Rev. 6-98)

requested by the Owner, the Engineer shall attend, or appear as a witness in, hearings or other proceedings before
public service commissions or other regulatory bodies in connection with procuring of the foregoing.
Section 13. When notified by the Administrator (if approval of the Administrator is required) and by the
Owner of their approval of the form of Construction Contract, the Engineer shall immediately take all appropriate
and necessary action to procure full, free, and competitive bidding for the award of such contract or contracts, and
when requested assist the Owner with the purchase of material and equipment. The term "Construction Contract"
as used herein shall also include right-of-way clearing contracts, equipment contracts, or materials contracts if
such contracts are utilized in the construction of the project. In fulfilling this responsibility, the Engineer shall
prepare and submit to the Owner for approval a recommended list of qualified bidders to construct the project.
Upon approval of such list by the Owner, the Engineer, in collaboration with the Owner, shall fix a date for the
opening of bids for such contracts. The Engineer shall prepare and furnish to the qualified bidders the Plans and
Specifications and Construction Drawings together with all necessary forms and other documents.
Section 14. The Engineer shall be available to each prospective bidder for consultation with respect to the
details of the Plans and Specifications and all other matters pertaining to the preparation of the proposals for the
construction of the Project or the supply of materials or services therefor. The Engineer, or a competent
representative of the Engineer, shall attend and supervise all openings of bids for the construction of the Project or
for the furnishing of materials or services therefor. In case fewer than three (3) bids are received for the
construction of the Project or component parts of the Project, the Owner shall be notified immediately and such
bids shall remain unopened unless permission is obtained from the Owner for the opening of such bids. If bids are
opened, the Engineer shall carefully check and prepare detailed assembly unit price tabulations of all bids received,
and shall render to the Owner all such assistance as shall be required in connection with consideration of the bids
received so that contracts may be prudently and properly awarded in accordance with the policy and procedure
prescribed by the Owner and the Administrator.
Section 15. If any change is to be made in the Plans and Specifications after the Construction Contract
has been approved by the Owner and by the Administrator, if approval of the Administrator is required, the
Engineer shall prepare and submit the necessary details for a contract amendment in accordance with the
procedure prescribed by the Owner and the Administrator.
ARTICLE III
Staking
Section 1. The Engineer, with the approval of the Owner, shall determine when staking of the Project shall
begin; provided, however, that the Engineer shall not commence staking until the Owner shall have certified that all
right-of-way authorizations and easements reasonably required for the construction of the Project have been
procured. The Owner shall furnish qualified persons to negotiate with landowners or tenants with respect to such
right-of-way authorizations and easements and the locations of meter poles or service entrances. The Engineer
shall proceed diligently with such staking and continue therewith in such mariner as not to retard the progress of
construction of the Project.
The staking shall be done in a thorough and workmanlike manner and in accordance with the latest
revision of the National Electrical Safety Code, applicable State codes, plans and specifications, and approved
transmission line plan and profile sheets. The Engineer shall in no case stake lines other than those authorized by
the Owner. The Engineer shall replace all stakes lost or removed prior to or during construction of the Project. All
costs, including costs of stakes, equipment, and other material used in connection with the staking, shall be borne by
the Engineer. All stakes shall be marked to show the pole number. Where practicable, all stakes shall be driven in
such manner that the pole number shall be visible from the pole hauling truck when poles are being distributed
Each transmission structure stake shall be marked with the station number and the height and class of pole. Where
it is probable that the Contractor will have difficulty in locating stakes, the Engineer shall drive a four-foot (1.2 m)
building lath or equivalent in addition and adjacent to the stake. The Engineer shall give due consideration to the
location of the consumer's load center and service termination in staking pole locations on or near the consumer's
premises so that the service entrance cable or low voltage conductors to buildings will be as short as possible.

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4

Section 2. The Engineer shall cause staking sheets or structure lists to be maintained in such form as the
Owner shall require, on which shall be accurately entered all pertinent and useful information and directions
concerning the construction of the Project. Five counterparts of the staking sheets or structure lists shall be
supplied by the engineer to the Contractor and two copies shall be supplied to the Owner. When revisions in
staking sheets or structure lists are necessary, the Engineer shall cause all copies of the staking sheets or structure
lists to be corrected to reflect such revisions in the information or directions previously incorporated thereon.
Section 3. The Engineer shall prepare and submit to the Owner a report showing the quantity, kind, price,
and extended total of all units of construction for each portion of the Project at the time such portion is released to
the Contractor for construction.
Section 4. A competent resident engineer, with full authority to act for the Engineer, shall be maintained
by the Engineer at the site of the Project at all times when staking is being performed..
ARTICLE IV
Construction Management
Section 1. The Engineer shall supervise the construction of the Project and shall make a diligent effort to
ensure the expeditious and economical construction thereof in accordance with the Plans and Specifications and the
terms of the Construction Contract or contracts and ensure that all specified environmental criteria are followed.
The Engineer shall carefully inspect all materials and equipment prior to their incorporation in the Project and
shall promptly reject those not in compliance with the Specifications. The Engineer shall also supervise and inspect
the incorporation of the materials in the Project and the workmanship with which such materials are incorporated..
Such inspection shall be deemed to be adequate if a reasonable percentage of all construction units are inspected at
the time of installation. The Engineer, as representative of the Owner, shall have sole responsibility for requiring
the Contractor to perform the Construction Contract in accordance with its terms and the Plans and Specifications;
and, in performing the duties incident to such responsibility, the Engineer shall issue to the Contractor such
directives and impose such restrictions as may be required to obtain reasonable and proper compliance by the
Contractor with the terms of the Construction Contract and the Plans and Specifications, in construction of the
Project; provided that the Engineer shall not be required to exercise any actual control over employees of the
Contractor. The term "supervise" when used herein shall not confer upon the Engineer responsibility for the
Contractor's construction means, methods, or techniques. The obligations of the Engineer hereunder run to and
are for the benefit of only the Administrator and the Owner.
Section 2. The Engineer shall measure ground resistance at all substation ground fields prior to bonding
the ground field to the substation structure. In addition, upon recommendation by the Engineer and authorization
by the Owner, the Engineer shall measure the ground resistance at the following locations:
(a) At all transmission structures with overhead ground wire prior to the installation of the overhead
ground wire.
(b) At all transmission structures with pole grounds prior to the installation of power conductor. The
Engineer shall prepare a report of the ground resistance measurements mentioned above and submit such
report to the Owner together with recommendations for changes, if any, required to ensure satisfactory
operation. To the extent such changes are approved, the Engineer shall make appropriate changes in the Plans
and Specifications in accordance with the provisions of Section 15 of Article II.
Section 3. The Engineer shall maintain at the site of the Project during the entire period of construction a
competent resident engineer with full authority to act for the Engineer, unless specifically directed otherwise by the
Owner in writing. When necessary to assure adequate inspection, one or more competent inspectors shall also be
maintained when construction units are being installed or corrective work is being performed, the number of
inspectors being subject to approval by the Owner. The Engineer shall report, in writing, defects in workmanship
or materials to the Contractor and the Owner and shall instruct the Contractor to correct such defects immediately,
in accordance with the terms of the Construction Contract. A resident engineer shall be present during the final
inspection of completed construction.

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RUS FORM 236 (Rev. 6-98)

Section 4. The Engineer shall test along lines, immediately after they have been energized, for
objectionable radio interference. All cases of radio interference due to faulty construction of or defective equipment
in the Project shall be reported to the Contractor for correction.
ARTICLE V
Final Documents
Section 1. The Engineer shall prepare and, within twenty (20) days after the completion of construction of
the Project by the Contractor, submit complete and detailed final documents to the Owner for approval and to the
Administrator for approval, if approval of the Administrator is required.
ARTICLE VI
Compensation
Section l. The Owner shall pay the Engineer for the services performed hereunder as indicated in the
attached Schedule A.
Section 2. The total compensation to be paid in connection with this Agreement shall not exceed
$

Dollars)

(

Section 3. Compensation payable to the Engineer under this Agreement shall be in addition to taxes or
levies (excluding Federal, State and local income taxes) which may be assessed against the Engineer by any State
or political subdivision directly on services performed or payments for services performed by the Engineer pursuant
to this Agreement. Such taxes or levies, which the Engineer may be required to collect or pay, shall, in turn, be
added by the Engineer to invoices submitted to the Owner pursuant to this Agreement.
%) per annum [percentage is not to
Section 4. Interest at the rate of
percent (
exceed any applicable State usury laws] shall be paid by the Owner to the Engineer on all unpaid balances due the
Engineer commencing thirty (30) days after the due date; provided that the delay in payment beyond the due date is
not caused by any condition within the control of the Engineer. Such compensation shall be paid ten (10) days after
the amount of interest has been determined by the Engineer and the Owner.
Section 5. Prior to the time when any payment shall be made to the Engineer pursuant to this Agreement,
the Engineer, if requested by the Owner, shall furnish to the Owner, as a condition precedent to such payment, a
certificate to the effect that all salaries or wages earned by the employees of the Engineer in connection with the
Project, have been fully paid by the Engineer up to and including a date not more than fifteen (15) days prior to the
date when such payment shall be made. Before the time when the final payment shall be made to the Engineer by
the Owner, the Engineer shall also furnish to the Owner, as a condition precedent to such payment, a certificate that
all the employees of the Engineer have been paid for services rendered by them in connection with the Project and
that all other obligations which might become a lien upon the Project have been paid.
ARTICLE VII
Miscellaneous
Section 1. The Owner may at any time terminate this Agreement by giving notice to the Engineer in
writing to that effect not less than ten (10) days prior to the effective date of termination specified in the notice.
Such notice shall be deemed given if delivered or mailed to the last known address of the Engineer. From and after
the effective date specified in such notice, this Agreement shall be terminated, except that the Engineer shall be
entitled to receive compensation for services hereunder as provided in Section 2 of this Article VII.

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6

Section 2. In the event that this Agreement at any time be terminated pursuant to Section 1 of this
Article VII, the compensation which shall be payable to the Engineer by the Owner shall be computed so far as
possible in accordance with the provisions of Article VI. To the extent that the provisions of Section 1 of Article VI
cannot be applied because construction is incomplete at the effective date of such termination, the Engineer shall be
paid for engineering services in respect of incomplete construction a sum which shall bear the same ratio of the
compensation which would have been payable under the provisions of Section 1 of Article VI, if such construction
had been completed, as the engineering services in respect of such incomplete construction bear to the engineering
services which would have been rendered if construction had been completed.
If requested by the Owner, the Engineer shall submit to the Owner in duplicate a verified statement of
actual expenses in respect of such incomplete construction. All compensation payable under this Section 2 shall be
due and payable thirty (30) days after the approval by the Owner of the amount due hereunder.
Section 3. The Engineer shall have the right, by giving the Owner not less than thirty (30) days notice in
writing, to terminate this Agreement if the Engineer shall have been prevented by conditions beyond the control and
without the fault of the Engineer (a) from commencing performance of this Agreement for a period of twelve (12)
months from the date of this Agreement, or (b) from proceeding with the completion of full performance of any
remaining services required of the Engineer pursuant to this Agreement for a period of six (6) months from the date
of last performance by the Engineer of other services required pursuant to this Agreement. From and after the
effective date specified in such notice this Agreement shall be terminated, except that the Engineer shall be entitled
to receive compensation for services performed hereunder, computed and payable in the same manner as set forth
in Section 2 of this Article.
Section 4. Upon completion of the Project or termination of the Contract, the Engineer shall be obligated
forthwith to deliver to the Owner all maps, tracings, and drawings of the Project and all letters, documents, and
other material, including all records pertaining thereto.
The term "Completion of the Project" shall mean full performance of all obligations under this Contract
and all amendments and revisions thereof as evidenced by the approval of the final documents by the Owner and by
the Administrator, if approval of the Administrator is required
Section 5. The Engineer shall follow all applicable RUS rules and regulations.
Section 6. The Engineer shall prepare and execute in such form and detail as the Owner and the
Administrator shall direct all estimates, certificates, reports, and other documents required to be executed by the
Engineer pursuant to the terms of the Construction Contract or the Loan Contract, including progress reports of
engineering services and reports of the progress of construction.
Section 7. The Engineer shall approve each monthly estimate of the Contractor prior to payment by the
Owner. Such approval shall include a certification by the Engineer that all construction for which payment is
requested has been completed in accordance with the terms of the Construction Contract and that all defective
construction, of which the Contractor shall have received fifteen (15) or more days written notice, has been
corrected. The Engineer shall also maintain at the site of the Project a cumulative inventory of all units of
construction incorporated in the Project.
Section 8. The Engineer shall notify the Owner when the Project, or any section thereof, shall be ready to
be energized. When requested by the Administrator, such notice shall also be given to the Administrator. The
Engineer shall assist the Owner in causing the Project, or such section thereof to be energized.
Section 9. Insurance. The Engineer shall take out and maintain throughout the period of this Agreement
insurance of the following types and minimum amounts:
(a) Workers' compensation and employers' liability insurance, as required by law, covering all of the
Engineer's employees who perform any of the obligations of the Engineer under the Agreement. If any
employer or employee is not subject to the workers' compensation laws of the governing State, then insurance
shall be obtained voluntarily to extend to the employer and employee coverage to the same extent as though the
employer or employee were subject to the workers' compensation laws.
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RUS FORM 236 (Rev. 6-98)

(b) Public liability insurance covering all operations under the Agreement shall have limits for bodily
injury or death of not less than $1 million each occurrence, limits for property damage of not less than
$1 million each occurrence, and $1 million aggregate for accidents during the policy period A single limit of
$1 million of bodily injury and property damage is acceptable. This required insurance may be in a policy or
policies of insurance, primary and excess including the umbrella or catastrophe form.
(c) Automobile liability insurance on all motor vehicles used in connection with the Agreement,
whether owned, nonowned, or hired, shall have limits for bodily injury or death of not less than $1 million per
person and $ 1 million per occurrence, and property damage limits of $1 million for each occurrence. This
required insurance may be in a policy or policies of insurance, primary and excess including the umbrella or
catastrophe form.
(d) Errors and Omissions (Professional Liability) Insurance in an amount at least as large as the
maximum compensation specified in Article VI, Section 2, but not less than $500, 000.
The Owner shall have the right at any time to require public liability insurance and property damage
liability insurance greater than those required in subsections "b" and "c" of this Section. In any such event, the
additional premium or premiums payable solely as the result of such additional insurance shall be added to the
total compensation to be paid under this Agreement.
The Owner shall be named as Additional Insured on all policies of insurance required in subsections "b"
and "c" of this Section.
The policies of insurance shall be in such form and issued by such insurer as shall be satisfactory to the
Owner. The Engineer shall furnish the Owner a certificate evidencing compliance with the foregoing requirements
which shall provide not less than thirty (30) days prior written notice to the Owner of any cancellation or material
change in the insurance.
The Engineer shall also follow the requirements of 7 CFR part 1788, RUS Fidelity and Insurance
Requirements for Electric and Telephone Borrowers.
Section 10. The obligations and duties to be performed by the Engineer under this Agreement shall be
performed by persons qualified to perform such duties efficiently. The Engineer, if the Owner shall so direct, shall
replace any resident engineer or other persons employed by the Engineer in connection with the Project. The
Engineer shall file with the Owner and the Administrator a statement, signed by the Engineer, of the qualifications,
including specific experience of each engineer and inspector assigned to the Project and the duties assigned to
each.
Section 11. Approvals, directions, and notices provided to be given hereunder by the Administrator to the
Engineer or the Owner shall be deemed to be properly given if given by any person authorized by the Administrator
to give approvals, directions, or notices.
Section 12. The Engineer shall establish and maintain an office at the site of the Project, with telephone
service where available, when staking or construction is in progress. Any notice, instructions, or communications
delivered to such office shall be deemed to have been delivered to the Engineer.
Section 13. This Agreement may simultaneously be executed and delivered in two or more counterparts
each of which so executed and delivered shall be deemed to be an original, and all shall constitute but one and the
same instrument.
Section 14. The obligations of the Engineer under this Agreement shall not be assigned without the
approval in writing of the Owner.

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Section 15. The Engineer shall comply with applicable statutes pertaining to engineering and warrants
that

[Name of Engineer] who will be in responsible charge of the

Project possesses license number
on the

issued by the State of

day of

,

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed.

Owner

By
President
ATTEST:

Secretary

Engineer

President

Partner

[Strike out inapplicable designation.]
ATTEST:

Secretary

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THIS PAGE IS
INTENTIONALLY
BLANK

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Schedule A
Compensation

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RUS FORM 236 (Rev. 6-98)