Construction Phase

During the Construction Phase of all State Revolving Fund (SRF) projects, the SRF Loan Program's technical and administrative staff will review and approve bid packages and disbursement/pay requests. The technical staff will review and approve Change Orders and Operation and Maintenance Manuals, participate in Pre-construction Conferences, conduct monthly Interim Construction Inspections and Final Construction Inspections, ensure that the SRF Loan Program is notified about the Initiation of Operations, and accept Performance Certification.

Pre-construction Conference

Subsequent to the contract award and prior to the initiation of construction of SRF projects, the technical staff of the SRF Loan Program participates in a Pre-construction conference with the owner, engineer, and contractor. At a minimum, the issues discussed at the Conference will include the following:

  • Land Acquisition
  • Loan Disbursement Requests
  • O&M Manual (SRF projects only)
  • Contractor Disbursement/Pay Requests
  • Monthly Interim Construction Inspections
  • Resident Inspection
  • O&M Certification/Performance Certification
  • Final Construction Inspection
  • Work Stoppage
  • Working Relationships
  • Project Signage and Location
  • Responsibilities for Safety
  • Liquidated Damages
  • Change Orders
  • Wastewater Containment During Construction
  • Retainage and Interest

A Pre-construction Conference Report will be completed by the SRF Loan Program´s technical staff and distributed to meeting attendees, as appropriate.

Interim Construction Inspections

The technical staff of the State Revolving Fund (SRF) Loan Program conducts Interim Construction Inspections during the Construction Phase of State Revolving Fund projects. An Interim Construction Inspection Report will be prepared and distributed to the loan recipient, their consulting engineer, and others, as appropriate, following each Interim Inspection. The Interim Inspection Report will include a review of the total and most recent loan disbursements, the remaining loan balance, the loan recipient´s management of project files, identification of inspection participants, contract information, contract description, Change Order information, contractor´s pay estimate information, construction information, a summary of work in progress, work completed since the previous inspection, and observed deficiencies.  Also, a Fiscal Sustainability Plan (FSP) must be completed and available for review by the SRF Loan Program’s staff upon the first interim construction inspection visit.

Change Orders

Four original copies of Change Orders and appropriate backup documentation must be submitted to the SRF Loan Program for review and approval prior to implementing the proposed changes. Change Order packages are reviewed for appropriateness, concurrence with the approved Facilities Plan document and the SRF loan agreement, cost-effectiveness, and necessity regarding the successful completion and operation of the project or pertaining to the correction of errors in the Plans and Specifications. The Change Order package should include the correct project name and SRF project number, the names of the SRF loan recipient and the contractor, the correct Change Order number (in sequence) and date, the original signatures of the consulting engineer, contractor, and SRF loan recipient, and a complete description of the changes including quantities and sizes of materials and equipment, labor hours, overhead, profit rates, prices, net changes in contact price and contract time, and the amended contract amount and amended contract completion date.

Changes that are consistent with the objectives of the approved SRF project and that are within the approved project scope and current funding level of the loan agreement do not require the execution of a formal loan amendment. However, when changes will result in the expenditure of more funds than the loan amount, either the loan recipient must execute a loan amendment or the loan recipient must provide for the additional project funding prior to the implementation of the changes.

Final Construction Inspections

The technical staff of the SRF Loan Program will accompany the SRF loan recipient´s representative, the consulting engineer, and the contractor during the Final Construction Inspection. A Final Inspection Report will be prepared and distributed to Final Construction Inspection participants, as appropriate, following the inspection.

The Final Inspection Report will include a review of the total and most recent loan disbursements, the Plan of Operation, Operation and Maintenance Manual approvals, the loan recipient´s management of project files, identification of inspection participants, contract information, contract descriptions, Change Order information, contractor´s pay estimate information, construction information, a summary of work in progress, work completed since the previous inspection, the status of construction records, observed construction deficiencies, and additional comments, as appropriate.

Initiation of Operations

The Clean Water State Revolving Fund (CWSRF) or Drinking Water State Revolving Fund (DWSRF) loan recipient must forward an Initiation of Operation letter to the SRF Loan Program within 30 days following substantial completion of any facility construction funded by a CWSRF or DWSRF loan. When multiple construction contracts are awarded, the date for the Initiation of Operation should be the substantial completion date

Operation & Maintenance Manual (CWSRF projects only)

An Operation and Maintenance (O&M) Manual must be submitted to the SRF Loan Program by the SRF loan recipient´s consulting engineer for review and approval prior to the disbursement of 90-percent of the CWSRF loan. An amended O&M Manual that includes revisions resulting from the first year of operation (prior to the SRF Loan Program´s one-year, post-Initiation of Operation Performance Certification) must also be submitted to the SRF Loan Program for review and approval. The SRF Loan Program´s technical staff will review and approve the original and amended O&M Manuals and issue comment or approval letters, as appropriate.

Performance Certification (CWSRF projects only)

SRF loan recipients are required to submit a Performance Certification letter to the SRF Loan Program at the end of the one-year start-up period following the facility´s Initiation of Operation. The letter must state that the facility meets or exceeds the performance standards submitted to the SRF Loan Program by the consulting engineer during the Design Phase. If Clean Water State Revolving Funds were used for the construction, upgrade, or expansion of a wastewater treatment facility, the letter must also state that the facility is in full compliance with the facility´s National Pollutant Discharge Elimination System Permit. The SRF Loan Program´s technical staff will conduct an Operation and Maintenance/Performance Certification Inspection and assess the acceptability of the facility´s post-start up performance. A Performance Certification Inspection Report will be prepared by the SRF Loan Program´s technical staff and distributed to the loan recipient and consulting engineer following the inspection. A Corrective Action Report must be submitted to the SRF Loan Program within 30 days of the end of the performance period if the facility´s performance is unacceptable or if the loan recipient is unable to certify the facility´s performance. The Corrective Action Report must describe any problems that preclude the Performance Certification. In addition, a detailed schedule and methods for correcting the problems and certifying the performance of the facility must be provided.