2014-648 Orange County - FY2015 NCDOT - Nonurbanized Area Public Transportation Grant Agreement - Section 5311

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y. Access to Third Party Contract Records. The Contractor agrees, and agrees to require its third party contractors and third party subcontractors, at as many tiers of the Project as required, to provide to the Federal and State awarding agencies or their duly authorized representatives, access to all third party contract records to the extent required by 49 U.S.C. § 5325(g), and retain such documents for at least five (5) years after project completion. Section 15. Leases. a. Capital Leases. To the extent applicable, the Contractor agrees to comply with FTA regulations, "Capital Leases,"49 C.F.R. Part 639, and any revision thereto. b. Leases Involvinq Certificates of Participation. The Contractor agrees to obtain the Department's concurrence before entering into any leasing arrangement involving the issuance of certificates of participation in connection with the acquisition of any capital asset. Section 16. Hold Harmless. Except as prohibited or otherwise limited by State law or except to the extent that FTA or the Department determines otherwise in writing, upon request by the Federal or State Government, the Contractor agrees to indemnify, save, and hold harmless the Federal and State Government and its officers, agents, and employees acting within the scope of their official duties against any liability, including costs and expenses, resulting from any willful or intentional violation by the Contractor of proprietary rights, copyrights, or right of privacy, arising out of the publication, translation, reproduction, delivery, use, or disposition of any data furnished under the Project. The Contractor shall not be required to indemnify the Federal or State Government for any such liability caused by the wrongful acts of Federal or State employees or agents. Section 17. Use of Real Property, Equipment, and Supplies. The Contractor understands and agrees that the Federal Government retains a Federal interest and the State government retains a State interest in any real property, equipment, and supplies financed with Federal or State assistance (Project property) until, and to the extent, that the Federal/State Government relinquishes its Federal or State interest in that Project property. With respect to any Project property financed with Federal/State assistance under this Agreement, the Contractor agrees to comply with the following provisions of this Agreement, except to the extent FTA or the Department determines otherwise in writing: a. Use of Proiect Property. The Contractor agrees to maintain continuing control of the use of Project property to the extent satisfactory to the Department. The Contractor agrees to use Project property for appropriate Project purposes (which may include joint development purposes that generate program income, both during and after the award period and used to support public transportation activities) for the duration of the useful life of that property, as required by FTA or the Department. Should the Contractor unreasonably delay or fail to use Project property during the useful life of that property, the Contractor agrees that it may be required to return the entire amount of the Federal and State assistance expended on that property. The Contractor further agrees to notify the Department immediately when any Project property is withdrawn from Project use or when any Project property is used in a manner substantially different from the representations the Contractor has made in its Application or in the Project Description for this Agreement for the Project. In turn, the Department shall be responsible for notifying FTA. b. General. The Contractor agrees to comply with the property management standards of 49 C.F.R. §§ 19.30 through 19.37, including any amendments thereto, and with other applicable Federal and State regulations and directives. Any exception to the requirements of 49 C.F.R. §§ 19.30 through 19.37 requires the express approval of the Federal Government in writing. The Contractor also consents to the Department's reimbursement requirements for premature dispositions of certain Project equipment, as set forth in Subsection 14i of this Agreement. c. Maintenance and Inspection of Vehicles, Facilities and Other Project Equipment . The Contractor shall maintain all project equipment at a high level of cleanliness, safety, and mechanical soundness in accordance with the minimum maintenance requirements recommended by the manufacturer. The Contractor shall register all vehicle maintenance activities in a Comprehensive Maintenance Record or an electronic version of same. The Department shall conduct frequent inspections to confirm proper maintenance pursuant to this Subsection 15c of this Agreement and the Revised 4/22/14 Page 21 of 36