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b. Record Retention. The Contractor and its third party contractors shall retain all
<br />records pertaining to this Project for a period of five (5) years from the date of final payment to the
<br />Contractor, or until all audit exceptions have been resolved, whichever is longer, in accordance with
<br />"Records Retention and Disposition Schedule -Public Transportation Systems and Authorities, April 1,
<br />2006," at (http://www.ah.dcr.state.nc.us/records/local/).
<br />c. Access to Records of Contractor and Subcontractors. The Contractor shall permit
<br />and shall require its third party contractors to permit the Department, the Comptroller General of the
<br />United States, and the Secretary of the United States Department of Transportation, or their authorized
<br />representatives, to inspect all work, materials, payrolls, and other data and records with regard to the
<br />Project, and to audit the books, records, and accounts of the Contractor pertaining to the Project. The
<br />Department shall reserve the right to reject any and all materials and workmanship for defects and
<br />incompatibility with Project Description or excessive cost. The Department shall notify the Contractor, in
<br />writing, if materials and/or workmanship are found to be unacceptable. The Contractor shall have
<br />ninety (90) days from notification to correct defects or to provide acceptable materials and/or
<br />workmanship. Failure by the Contractor to provide acceptable materials and/or workmanship, or to
<br />correct noted defects, shall constitute a breach of contract.
<br />d. Proiect Closeout. The Contractor agrees that Project closeout does not alter the
<br />reporting and record retention requirements of this Section 6 of this Agreement.
<br />Section 10. Proiect Completion, Audit, Settlement, and Closeout.
<br />a. Project Completion. Within ninety (90) .calendar days following Project completion,
<br />the end of the Project's period of performance, or termination by the Department, the Contractor agrees
<br />to submit a final reimbursement request to the Department for eligible Project expenses.
<br />b. Financial Reporting and Audit Requirements. In accordance with OMB Circular A-
<br />133, "Audits of State, Local Governments and Non-Profit Organizations, revised on June 27, 2003,
<br />and N.C.G.S. 159-34, the Contractor shall have its accounts audited as soon as possible after the close
<br />of each fiscal year by an independent auditor. The Contractor agrees to submit the required number of
<br />copies of the audit reporting package to the Local Government Commission four months after the
<br />Contractor's fiscal year-end.
<br />c. Audit Costs. Unless prohibited by law, the costs of audits made in accordance with
<br />the provisions of OMB Circular A-133 are allowable charges to State and Federal awards. The charges
<br />may be considered a direct cost or an allocated indirect cost, as determined in accordance with cost
<br />principles outlined in OMB Circular A-87 "Cost Principles for State, Local, and Indian Tribal
<br />Governments." The cost of any audit not conducted in accordance with OMB Circular A-133 and
<br />N.C.G.S. 159-34 is unallowable and shall not be charged to State or Federal grants.
<br />d. Funds Owed to the Department. The Contractor agrees to remit to the Department
<br />any excess payments made to the Contractor, any costs disallowed by the Department, and any
<br />amounts recovered by the Contractor from third parties or from other sources, as well as any penalties
<br />and any interest required by Subsection 7g of this Agreement.
<br />e. Proiect Closeout. Project closeout occurs when the Department issues the final
<br />project payment or acknowledges that the Contractor has remitted the proper refund. The Contractor
<br />agrees that Project closeout by the Department does not invalidate any continuing requirements
<br />imposed by this Agreement.
<br />Section 11. Civil Rights. The Contractor agrees to comply with all applicable civil rights laws and
<br />implementing regulations including, but not limited to, the following:
<br />a. Nondiscrimination in Federal Public Transportation Programs. The Contractor
<br />agrees to comply, and assures the compliance of each third party contractor at any tier and each
<br />subrecipient at any tier of the Project, with the provisions of 49 U.S.C. § 5332, which prohibit
<br />discrimination on the basis of race, color, creed, national origin, sex, or age, and prohibits
<br />discrimination in employment or business opportunity.
<br />b. Nondiscrimination -Title VI of the Civil Rights Act. The Contractor agrees to comply,
<br />and assures the compliance of each third party contractor at any tier and each subrecipient at any tier
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