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HomeMy WebLinkAboutRes2020-042 Sponsored by: Meszaros CITY OF SEWARD,ALASKA RESOLUTION 2020-042 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AUTHORIZING THE CITY MANAGER TO ENTER INTO A COOPERATIVE AGREEMENT WITH THE STATE OF ALASKA DEPARTMENT OF FISH & GAME (ADF&G), DIVISION OF ADMINISTRATIVE SERVICES, FOR THE FEDERAL AID IN SPORT FISH RESTORATION ACT, RECREATIONAL BOATING ACCESS (BA) PROGRAM, FOR THE PURPOSE OF DESIGNING AND PERMITTING A REPLACEMENT OF THE NORTHEAST HARBOR LAUNCH RAMP WHEREAS, in 2019, the State of Alaska Department of Fish & Game (ADF&G) evaluated the North East Launch ramp and determined it needed to be replaced; and WHEREAS, the City has pursued funding with ADF&G to replace the North East Launch Ramp; and WHEREAS, the approval of Resolution 2019-094 committed to provide funding for the City's 25% match to replace the North East Harbor Launch Ramp, under Phase II of the construction portion of the project; and WHEREAS, ADF&G has sent the City a Cooperative Agreement (2020-122) to start Phase I of the project, including design and permitting; and WHEREAS, ADF&G and the Federal Aid in Sport Fishing Restoration Act, Recreational Boating Access (BA) Program, will fully fund Phase I with the estimated cost of $400,000; and WHEREAS, the City of Seward will continue to comply with the ADF&G Agreement for the complete renovation of the North East Harbor Launch Ramp. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA that: Section 1. The City Manager is hereby authorized to enter into Cooperative Agreement 2020-122 with the State of Alaska Department of Fish & Game and the Federal Aid in Sport Fishing Restoration Act, Recreational Boating Access Program, for Phase I of the City of Seward's North East Harbor launch ramp renovation project, in substantial form as attached hereto. Section 2. This resolution shall take effect immediately upon adoption. CITY OF SEWARD,ALASKA RESOLUTION 2020-042 PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 26th day of May, 2020. I T . ' I ' • 4 SEWARD,ALASKA gAlleirLA Aviv_ sty erry, ayor AYES: Osenga, Seese, Baclaan, Crites, McClure, Terry NOES: None ABSENT: Butts ABSTAIN: None ATTEST: Brenda J. Ball , MMC City Clerk (City Seal).....ssss iiissi4 G�,?GOitP O�T\141.,e. SEAL I . ' 0. ygrF Of ;kV:**`�- *easierws.s I;kV: Agenda Statement Meeting Date: May 26, 2020 To: Scott Meszaros, City Manager _ From: Norm Regis, Harbormaster Agenda Item: Authorizing the City Manager to enter into a cooperative agreement with the State of Alaska Department of Fish and Game to plan, design, and permit replacement of the Seward North East Harbor Launch Ramp. BACKGROUND &JUSTIFICATION: The State of Alaska Department of Fish and Game ("ADF&G") conducted an evaluation of the northeast harbor launch ramp in 2019 and recommended that the launch ramp be replaced. The ramp requires increasing levels of maintenance and while we are currently able to utilize the ramp, it has become more of a safety issue due to rotting wood,necessitating replacement. The concrete planks are failing at an alarming rate. The city council approved Resolution 2019-094,committing remaining funds from the South Harbor Launch Ramp Replacement Project towards the City's 25%match for construction of the Northeast Harbor Replacement Project, with ADF&G funding the remaining 75%. This first phase of the project involves the planning, design and permitting of the northeast harbor launch ramp, and will be 100°I• direct funded by ADF&G, where the state will hire and pay the consultants for planning,design and permitting. The administration seeks council approval to sign the Cooperative Agreement between the City and ADF&G for Phase I of the project (please see attached Cooperative Agreement (20-122). The estimated cost of Phase I will be $400,000; the funding source will be 75% from the Federal Aid in Sport Fishing Restoration Act and 25% from state matching funds. INTENT: Authorize the city manager to enter into a cooperative agreement(20-122)with ADF&G for Phase I, the design and permitting of the northeast harbor launch ramp. CONSISTENCY CHECKLIST: Yes No NIA Comprehensive Plan (Page 16 3.5.1): Maintain a thriving port of 1. Seward through harbor improvements, infrastructure expansion, and X im lantation of management lans. 2 Strategic Plan (document source here): Page 7 Complete the renovation X of the Boat Harbor. 3 Seward Boat Harbor Plan (Page 21, 4.7): Work with ADF&G using X Sports Fish Restoration funds to build or rebuild boat ram is. 251 FISCAL NOTE: No city funds are required for Phase I. It is to be entirely funded by ADF&G. However, the City previously committed to fund the 25%match for Phase II;the construction for the renovation of the northeast launch ramp. The City previously appropriated funds for Phase II for this project in Resolutions 2019-094 ($240,000.00) Approved by Finance Department: ]A ATTORNEY REVIEW: Yes No X RECOMMENDATION: Council approve Resolution 2020-042 ,_.authorizing the city manager to enter into a cooperative agreement with ADF&G for Phase I; the design and permitting of the northeast harbor launch ramp. 252 P 9 Alaska Department of Fish and Game Division of Administrative Services a _ P.O. Box 115526 °of rI Juneau,AK 99811-5526 �FNr SN p� Cooperative Agreement Number 20-122 Title: Seward North Harbor Launch Ramp Renovation Between: Alaska Department of Fish and Game Division of Sport Fish And the CITY of SEWARD I. AUTHORITY: This agreement is entered into by and between the Alaska Department of Fish and Game, Division of Sport Fish (hereinafter referred to as the "ADF&G" or the "Department") and the City of Seward (hereinafter referred to as the "CITY"). ADF&G enters into this agreement under authority AS16.05.050 (12), AS36.30.850(c)and the Federal Aid in Sport Fish Restoration Recreational Boating Access Program (CFDA#15.605). II. PURPOSE OF THE AGREEMENT: To improve public recreational boating and sport fishing access to the marine waters near Seward by cooperatively rehabilitating and maintaining the north boat launch facility in the Seward Harbor. This will be accomplished in two phases: Phase I-design and permitting, and Phase 11-construction. III. TERM OF THE AGREEMENT: The effective date of this agreement shall be from the date of final signature.The design life of this facility is 20 years;therefore,this agreement shall remain in effect until December 31, 2041. IV. COVENANTS OF THE ALASKA DEPARTMENT OF FISH AND GAME: 1. To hire a design consultant to complete planning activities(Phase 1)for the future construction of the Seward North Harbor Boat Launch Ramp Facility, hereinafter referred to as the"facility". Phase I will consist of design, permitting,and compliancy activities and Phase 11 will consist of construction-related activities. Once Phase I is complete,this agreement will be amended to address additional funding needed for Phase 11 of the project. The total estimated cost of Phase I is$450,000. The source of funding for Phase I shall be 75%from the Federal Aid in 253 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 Sport Fish Restoration Act(Dingell-Johnson/Wallop-Breaux)and 25%from state matching funds.Availability of these funds shall be subject to approval of the project by the Federal Aid Office of the U.S. Fish and Wildlife Service (USF&WS). 2. To authorize the CITY to continue to manage and maintain the facility as a CITY facility,which will be operated primarily for the use of recreational power boaters and sport anglers. 3. To perform a final inspection of the completed project to verify compliance with this agreement. V. COVENANTS OF THE CITY: 1. To dedicate to this project, CITY owned uplands and/or tidelands under and immediately adjacent to the facility. The parcel shall be used exclusively for boat launch ramps, boarding floats, a parking area for vehicles with boat trailers, and other improvements incidental to this project.The parcel is shown on Attachment A. The CITY warrants that it has the right, power, and authority to construct the improvements on the access site and that there are no restrictions, covenants,easements, rights-of-way,or uses which would prevent the CITY from constructing the improvements on the access site. 2. To complete the construction of the facility funded by this agreement prior to December 31, 2021. In the event the funding provided by ADF&G is not sufficient to cover all costs incurred by the CITY in completing this project, the CITY shall provide all additional funding that may be needed. 3. To manage and maintain the facility for public use until December 31, 2041.The facility will be managed primarily for the benefit of the recreational boating and sport fishing public in providing access to public waters consistent with current management. No change in this use will be made without prior written approval of ADF&G. 4. Management activities and maintenance services shall ensure orderly public use and keep the facility clean and in a good state of repair. Management and maintenance may be adjusted seasonally commensurate with seasonal public use. 5. ADF&G will consider the facility closed to the public if the CITY physically denies access,fails to provide adequate management or maintenance or allows incompatible uses of the facility that effectively limits public use by recreational boaters and sport anglers. 6. To obtain and comply with all federal, state and local permits required for construction and maintenance of the project. 7. To install a sign identifying the participation of ADF&G,the Federal Aid in Sport Fish Restoration program,and sport anglers in facility development.To install additional signage as deemed appropriate,to indicate that the primary use of the facility is for sport fishing and recreational power boating access. 8. To be responsible,for a period of one year from the date of ADF&G's final inspection,for correcting all defects in the design or construction when the defect is brought to the attention of the CITY,without additional cost to ADF&G.The CITY will make good and be fully responsible for all damages to persons and property that arise from equipment or workmanship which is inferior,defective,or not in accordance with the terms of this agreement. 254 Page 2 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 9. To maintain adequate insurance in conjunction with the design, construction and maintenance of the improvements. 10. The CITY shall perform all aspects of the project in compliance with appropriate laws and regulations which include but are not limited to the following: a. Local Building Codes-CITY shall comply with applicable local buildings codes and shall obtain a building permit if required (AS 35.10.025). b. Historic Preservation-CITY shall comply with AS 41.35.070 to preserve historic, prehistoric and archeological resources threatened by public construction. c. Public Contracts-CITY shall comply with AS 36.05 in determining the wages and hours of labor on public contracts. d. Political Activity-Federal funds cannot be used for partisan political purposes of any kind by any person or organization involved in the administration of federally assisted programs. e. Civil Rights-Pursuant to Title VI of the Civil Rights Act of 1964,Section 504 of the Rehabilitation Act of 1973, Title I, II& III of the Americans with Disabilities Act of 1990,the Age Discrimination Act of 1975 and Title IX of the Education Amendments of 1972, no person shall,on the grounds of race,color, national origin,age,or handicap, be excluded from participation in or be subjected to discrimination in any program or activity funded in whole or in part by federal funds. f. Allowable costs/Cost principles-OMB 2 CFR 200 establishes principles and standards for determining costs applicable to grants,contracts, and other agreements with state and local governments. A cost is allowable for federal reimbursement only to the extent of benefits received by federal programs, and costs must meet the basic guidelines for allowability, reasonableness and allocability. g. Drug-free Workplace Act-CITY, by signing this agreement,certifies that they will provide a drug-free workplace. h. Debarment/Suspension—CITY, by signing this agreement, certifies that neither it, nor its principals or subcontractors is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from federal financial assistance programs or activities. i. Audits-CITY acknowledges that 75%of the funding for this agreement is from the Federal Aid office of the U.S. Fish and Wildlife Service under CFDA 15.605.The CITY acknowledges that receipt of federal funds may create audit requirements under OMB 2 CFR 200. j. Workers Compensation Insurance-CITY shall provide and maintain,for all employees engaged in work under this agreement,coverage as required by AS 23.30.045, (Appendix 131)and,where applicable, any other statutory obligations including but not limited to Federal U.S.L.& H. and Jones Act requirements. k. Open Competition-CITY shall comply with Executive Order 13202 dated February 17, 2001 prohibiting any requirements or bidding preferences based on contractor affiliation with labor organizations. 255 Page 3 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 11. If the CITY handles hazardous materials on the site,the CITY agrees to employ adequate procedures for safely storing,dispensing,and otherwise handling hazardous materials in accordance with applicable federal, state, and local laws. Hazardous materials include but are not limited to fuels and lubricants commonly used in vehicles and boats. In the event of a hazardous materials spill by the CITY or the public using the site,the CITY shall act promptly,at its own expense,to contain the spill, repair any damage, absorb and clean up the spill area, and restore the site to a condition satisfactory to the ADF&G and in accordance with applicable federal, state, and local laws.The CITY shall be the lead agency in requesting additional funds from the legislature to cover the cost of spill clean-up.ADF&G shall support such requests. If contamination of the site occurs as a result of the CITY's management of the site,the CITY shall indemnify, defend,and hold harmless the ADF&G from any and all claims,judgments,damages, penalties,fines, costs, liabilities,or losses. VI. GENERAL PROVISIONS: 1. ADF&G and the CITY shall cooperate in accomplishing the improvements to be provided under this agreement. ADF&G shall provide design criteria for the improvements.The CITY shall be the lead agency in accomplishing all work necessary to make the improvements.The CITY may employ construction contractors as may be appropriate.The project shall be designed by a professional engineer registered in the State of Alaska unless exempt under AS 08.48.331. 2. The CITY shall perform the following tasks in accomplishing this project: Phase I: Design and land status:The design shall be of sufficient detail to allow the CITY to develop a project budget, obtain all required permits and dedicate the land as specified in paragraph V.I. above.Any funds not used for Phase I tasks shall be available for construction-related (Phase II)activities. Phase II: Construction bidding:The CITY shall not proceed with its own personnel or advertising for contractor bids until notified in writing by ADF&G that the USF&WS has approved the project. In the event USF&WS approval is not obtained by ADF&G or the non-federal match requirement cannot be acquired,this agreement shall be terminated. During the bidding process,the CITY shall send to ADF&G a copy of the bid package and all addenda that may be issued. Construction:The CITY shall provide ADF&G a copy of the proposed construction schedule.The CITY shall also promptly notify ADF&G of all changes made to the schedule or the design.At the completion of the construction work,the CITY shall provide ADF&G a copy of the as-built plans. Reimbursement for construction work shall be contingent on ADF&G approval of work performed. ADF&G review of designs, plans, specifications or other project-related documents will be to ensure conformance to the purpose of this agreement and shall not constitute engineering review nor relieve the CITY from responsibility to prepare an adequate design, meet code compliance, or assure that cost principles are applied to change orders. 3. The CITY will be reimbursed only for the cost of work actually completed which is directly related and allocable to the project and which ADF&G has approved. Reimbursement will be made within 30 days of receipt and approval, by ADF&G, of a request for reimbursement from the CITY.All requests for reimbursement shall be 256 Page 4 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 adequately documented. Documentation may include copies of materials invoices, payroll ledgers,equipment logs,contract payments, etc. In the event of a late payment,ADF&G will not pay late fees. Requests for reimbursement shall be mailed no more frequently than once a month to Tracy Smith at: State of Alaska Department of Fish and Game, Division of Sport Fish, Region II 1800 Glenn Highway, Palmer,Alaska 99645 The CITY shall maintain a separate set of accounting records for this project and shall retain these records for a period of three years from the termination of the agreement.These records shall be made available to the state for audit purposes. With the exception of the initial and final payment, requests for reimbursement shall be in amounts not less than$25,000. If the CITY chooses to make monthly billings, such billings will be held by ADF&G until the total amount reaches at least$25,000. 4. The CITY may charge user fees in accordance with Seward Municipal Code per the harbor tariff,Ordinance No. 210-002, § 1(att.),9-27-2010"Boat Harbor", in effect on the effective date of this agreement.All future changes to the fee schedule shall be reviewed and approved by ADF&G. Fees shall be subject to the following criteria: a. Fees for recreational boating and sport fishing use shall not exceed fees for other uses at the facility. b. Fees shall not be imposed to recover the capital cost of the improvements covered by this agreement. c. Fees shall not exceed the cost of operation, maintenance and improvement of the site. d. Site specific fees that exceed the cost of operation, maintenance and improvement are program income. Fees collected and determined to be program income must be credited back to the Federal Aid in Sport Fish Restoration program through ADF&G.The basic policies for the treatment of program income by the USF&WS contained in OMB 2 CFR 200 apply to this agreement. e. The CITY may establish a capital improvement account from user fees collected,to fund specified major improvements to the site and/or routine maintenance, repair or replacement of the infrastructure. Establishment of such an account shall be reviewed and approved by ADF&G.The CITY shall specify the proposed improvement,the estimated cost,and completion date when requesting approval. Fees accumulated in a capital improvement account will not be considered program income if they are used for the approved improvement. f. If required by future changes to federal regulations or at the request of ADF&G,the CITY shall provide ADF&G an accounting of fees collected and costs of operation, maintenance, and improvements.This accounting shall be on an annual basis and in sufficient detail to satisfy state and federal regulations. g. Boats owned and operated by ADF&G and the Department of Public Safety shall be allowed to use the facility at no cost in the course of carrying out their official duties to the extent such use does not interfere with public use of the facility. 5. The effective date of this agreement shall be from the date of final signature by ADF&G. 6. The design life of the facility is 20 years;therefore,this agreement shall remain in effect until December 31, 2041. 257 Page 5 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 7. Either agency may terminate its involvement in this agreement by written notice to the other at least 90 days in advance of the date on which termination is to become effective. In the event that an agency terminates its involvement in this agreement, defaults in its duties under this agreement or this agreement expires, disposition of the sport fishing access improvements shall be accomplished by whichever of the following contingencies is appropriate: a. Agreement expires on December 31, 2041: ADF&G shall have the option to negotiate an extension of this agreement with the CITY for the continued use of the facility for public sport fishing access.ADF&G shall have 90 days after the expiration of this agreement in which to notify the CITY of its intent to exercise this option. If ADF&G does not exercise this option,all improvements shall become the property of the CITY. b. ADF&G terminates its involvement: If prior to December 31, 2041,ADF&G finds that there is no longer a need for the sport fishing access improvements covered by this agreement,then this agreement shall be terminated. Improvements funded by ADF&G shall become the property of the CITY at no additional cost to the CITY. c. The CITY terminates its involvement: If prior to December 31, 2041,the CITY closes the facility to the public, does not comply with the requirements of this agreement or terminates its involvement in the purpose of this agreement,this agreement shall be terminated, and the CITY shall reimburse ADF&G for: i. The total funding it provided at the rate of 5 percent for each full year between the date of termination and December 31, 2041. ii. The appraised fair market value,on the date of the CITY's default,of any land acquired for the project with ADF&G funds. This agreement shall be terminated when the CITY's reimbursement to ADF&G is completed.The CITY shall not be required to reimburse ADF&G in the event the facility must be closed to protect public safety because of casualty damage arising from a catastrophic occurrence. 8. The CITY may make improvements to the facility at its own expense provided the improvements are compatible with the purpose of this agreement and are approved in writing by ADF&G prior to construction. 9. Funding for major maintenance or repair of casualty damage will be negotiated on a case-by-case basis. Each agency's share of such funding shall be contingent on availability of funds. 10. The rights and responsibilities vested in each agency by this agreement shall not be assigned without the written consent of the other agency. 11. Agents and employees of each agency shall act in an independent capacity and not as officers,employees,or agents of the other agency in performance of this agreement. 12. Nothing in this agreement shall obligate either agency to the expenditure of funds or future payments of money in excess of those herein agreed upon or authorized by law. 13. Nothing in this agreement transfers title or land jurisdiction other than set forth herein. 258 Page 6 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 14. The CITY shall indemnify, hold harmless and defend ADF&G from and against any claim of,or liability for error, omission or negligent act of the CITY under this agreement.The CITY shall not be required to indemnify ADF&G for a claim of,or liability for,the independent negligence of ADF&G. If there is a claim of,or liability for,the joint negligent error or omission of the CITY and the independent negligence of ADF&G,the indemnification and hold harmless obligation shall be apportioned on a comparative fault basis. "CITY" and "ADF&G" as used within this paragraph, include the employees,agents and other contractors who are directly responsible, respectively,to each.The term "independent negligence" is negligence other than in ADF&G's selection, administration, monitoring or controlling of the CITY and in approving or accepting the CITY's work. 15. All parties agree to comply with all applicable federal and state laws regulating ethical conduct of public officers and employees. 16. Each agency will comply with all applicable laws, regulations,and executive orders relative to Equal Employment Opportunity. 17. Nothing herein is intended to conflict with federal, state,or local laws or regulations. If there are conflicts,this agreement will be amended at the first opportunity to bring it into conformance with conflicting laws or regulations. 18. This agreement may be revised as necessary by mutual consent of both parties, by the issuance of a written amendment,signed and dated by both parties. 19. All approvals and notices required by this agreement shall be sent by email to dfg.dsf.boataccess@alaska.gov or mailed to: Director City Manager Division of Sport Fish City of Seward Alaska Dept of Fish&Game 410 Adams Street P.O. Box 115526 P.O. Box 167 Juneau,Alaska 99811-5526 Seward,Alaska, 99664 20. This agreement is complete and has no other encumbrances, addenda, attachments, or amendments with the following exceptions:Attachment A: Parcel Location VII. FINANCIAL CONSIDERATIONS ADF&G will fully fund Phase I for accomplishing the purpose of this agreement in the amount of$450,000 total; any additional funding amount that may be needed to complete the project will be at the sole discretion of ADF&G.This cooperative agreement shall be amended to address additional funding that will be need for Phase II, construction. The CITY will be reimbursed only for the cost of work actually completed which is directly related and allocable to the project and which ADF&G has approved. All requests for reimbursement shall be adequately documented. Documentation may include copies of materials invoices, payroll ledgers, equipment logs, contract payments, etc. In the event of a late payment, ADF&G will not pay late fees. Upon project completion and final reimbursement to the CITY,the CITY shall provide ADF&G an accounting of fees collected for use of the federally funded improvement(s) during the grant period of performance.The dates of the 259 Page 7 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 grant period of performance will be defined by ADF&G and provided to the CITY for this purpose. Additionally,the CITY shall maintain a separate set of accounting records for this project and shall retain these records for a period of three years from the termination of the agreement.These records shall be made available to the state for audit purposes. 260 Page 8 VIII. APPROVING SIGNATURES IN WITNESS WHEREOF,the parties hereto have caused this Cooperative Agreement to be executed as of the date of last signature below. CITY OF SEWARD ATTEST Scott Meszaros, City Manager Brenda J. Ballou, MMC City of Seward City Clerk [City Seal] Date ALASKA DEPARTMENT OF FISH AND GAME Dave Rutz, Director Division of Sport Fish Date Samantha Gatton, Deputy Director Division of Administrative Services Date 261 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 Attachment A: Parcel Location Geographic information Systems Seward Harbor Northeast Launch Facility re "t rl N_t,i;rkl�_[ _.o�rlotna,Alaska 99fib9 � 6 ewar a �,• ���� ��y�l k Legend T,. r Mileposts Parcels NE Boat Ramp Facility E 2; -L tl4l r • � � r ct i+ Notes B.z o 0.12 o.z Mil as This maps a user generated stale ootpottrom an Internet mapping:ire and Is torreterenee only.Data layers that appear onthls map may or may not he accurate, Coordinate System'.NAD_19B3_StatePlane_Alaska_4_FIPS_5004_Feet evrent or otherwise reliable. THIS MAP IS NOT TO BF USED FOR NAVIGATION 262 Page 10 Alaska Dept.of Fish and Game Cooperative Agreement 20-122 APPENDIX 61 INDEMNITY AND INSURANCE Article 1. Indemnification The contractor shall indemnify, hold harmless, and defend the contracting agency from and against any claim of, or liability for error, omission or negligent act of the contractor under this agreement. The contractor shall not be required to indemnify the contracting agency for a claim of, or liability for, the independent negligence of the contracting agency. If there is a claim of, or liability for,the joint negligent error or omission of the contractor and the independent negligence of the contracting agency, the indemnification and hold harmless obligation shall be apportioned on a comparative fault basis. "Contractor" and "contracting agency", as used within this and the following article, include the employees, agents and other contractors who are directly responsible, respectively, to each. The term "independent negligence" is negligence other than in the contracting agency's selection, administration, monitoring, or controlling of the contractor and in approving or accepting the contractor's work. Article 2. Insurance Without limiting contractor's indemnification, it is agreed that contractor shall purchase at its own expense and maintain in force at all times during the performance of services under this agreement the following policies of insurance.Where specific limits are shown, it is understood that they shall be the minimum acceptable limits. If the contractor's policy contains higher limits,the state shall be entitled to coverage to the extent of such higher limits. Certificates of Insurance must be furnished to the contracting officer prior to beginning work and must provide for a notice of cancellation, non-renewal,or material change of conditions in accordance with policy provisions. Failure to furnish satisfactory evidence of insurance or lapse of the policy is a material breach of this contract and shall be grounds for termination of the contractor's services. All insurance policies shall comply with and be issued by insurers licensed to transact the business of insurance under AS 21. 2.1 Workers' Compensation Insurance:The Contractor shall provide and maintain,for all employees engaged in work under this contract, coverage as required by AS 23.30.045, and; where applicable, any other statutory obligations including but not limited to Federal U.S.L. & H. and Jones Act requirements. The policy must waive subrogation against the State. 2.2 Commercial General Liability Insurance:covering all business premises and operations used by the Contractor in the performance of services under this agreement with minimum coverage limits of$300,000 combined single limit per claim. 2.3 Commercial Automobile Liability Insurance: covering all vehicles used by the Contractor in the performance of services under this agreement with minimum coverage limits of$300,000 combined single limit per claim. 263 Page 11