R1 SUPPLEMENT 2409.18-95-3
EFFECTIVE 01/29/96
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FSH 2409.18 - TIMBER SALE PREPARATION HANDBOOK
R-1 SUPPLEMENT NO. 2409.18-95-3
EFFECTIVE 01/29/96
55.2 - Exhibit 02
TIMBER SALE PROSPECTUS
XXXXXXXXX NATIONAL FOREST
Section B. General Information
(Revised X/XX/95)
1.
INTRODUCTION. This section provides general information relative to timber sales on the XXXXXXXX National Forest, Section A of the prospectus provides
information specific to the timber sale being offered.
2.
BIDDING. The method of bidding (sealed bid or oral auction) is specified in Section A. Bidders must submit sealed or initial bids on prepared forms they can
obtain from Forest Service offices listed in the attached advertisement. The forms include instructions for bidding and submission of the required bid guarantee.
The amount of such bid guarantee is specified in Section A.
a. If this is a small business set-aside sale, or if it is set-aside for small business firms with 25 or fewer employees, it will be specified in Section A (also refer to
item 12 of Section B).
b. If 50 percent or more of the timber in this sale is being resold from an uncompleted contract (identified as such in Section A), bids from the previous
purchaser or any affiliates will not be considered on this sale. Bidders must complete a nonaffiliation statement submitted with bid.
c. One of several different bidding methods may be used for this sale. The method will be identified in Section A. They are as follows:
Weighted Average Stumpage Rate Bidding:
If weighted average bidding is the established bidding method, the following conditions apply:
Prospective purchasers must submit bids in terms of the weighted average stumpage rate. Estimated quantities of timber are stated in the advertisement.
Minimum acceptable rates and estimated quantities of timber together with the total estimated volume and average weighted stumpage rate are stated in
Section A of the prospectus. The bidder should enter the offer on the bid form only in terms of weighted stumpage rate. Unless the awardee requests
otherwise, the Forest Service shall establish (flat) (tentative) bid rates by species in the contract in proportionate relationship to minimum acceptable bid
rates. Such rates will be rounded to the nearest cent and, if necessary, further adjusted so that their weighted average is within 1 cent of the average rate bid.
Multiplying the advertised rates by the bid increase percentage yields the proportionate relationship between bid and advertised rates by species. The bid
increase percentage is the average rate bid divided by weighted average advertised rate.
Before contract execution, the awardee may specify (flat) (tentative) bid rates by species other than such proportionate rates, subject to the following
limitations:
a. No species rate is to be less than its advertised rate.
b. The increase on any species rate above its proportionate rate must not be more than the average all-species bid premium.
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c. The weighted average of the rates by species must be within one cent of the average weighted bid rate.
Average Bid Premium Bidding:
If average bid premium bidding is the established bidding method, the following conditions apply:
Prospective purchasers must submit bids for the sale-as-a-whole. The advertisement states minimum acceptable bid rates together with the estimated
quantities of timber. The bidder should enter the offer on the bid form only in terms of the sale-as-a-whole. The Forest Service shall conduct auction bids
only in terms of the sale-as-a-whole. Unless the purchaser requests otherwise, the Forest Service shall established (flat) (tentative) bid rates by species in
the contract equal to the minimum acceptable bid plus the average bid premium. The average bid premium will be rounded to the nearest cent. The
average bid premium is the bid increase for the sale-as-a-whole divided by the sale volume.
Before contract execution, the awardee may specify (flat) (tentative) bid rates by species other than such rates by assigning the bid premium within the
following limitations:
a.No species rate is to be less than its advertised rate.
b.The assigned bid premium for a species is to be no more than twice the average bid premium.
c.The weighted average of the bid premiums assigned must be within one cent of the average bid premium.
Total Sale Value/Proportionate Rate Bidding:
If total sale value/proportionate rate bidding is the established bidding method, the following conditions apply:
Only bids that display the total bid value for the timber sale shall be accepted. Any species bid values shown on the bid form by the bidder will be
disregarded and shall have no influence on the distribution of the bid premium. The following example illustrates how the proportionate rate method
will be used to assign the bid premium among species
ROCKY RIDGE SALE
Total Advertised Volume
Total Advertised Value
Total Bid Value
Bid Ratio
Volume
Species
MBF
PP
800
DF
1,200
Roundwood 400
Totals
2,400
2,400 MBF
$272,400
$400,000
1.4684 ($400,000 divided by $272,400)
Adv.
Rate/MBF
$160.00
120.00
1.00
$272,400
X
X
X
Applied Bid
Ratio
1.4684
1.4684
1.4684
Bid Rate/MBF
= $234.94
= 176.21
=
1.47
$399,992
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55.2 - Exhibit 02--Continued
3.
LOCATION AND DESCRIPTION OF TIMBER. Refer to sale area map attached to sample contract and to the sample contract for legal subdivisions and location
of cutting areas, the acreage of the sale area, and the harvest unit acreage. THE GENERAL LOCATION, ROUTES OF ACCESS, ACREAGES, AND OTHER
SPECIAL LOCATION DATA SHOWN IN SECTION A OF THE PROSPECTUS DO NOT SUPERSEDE THE SALE AREA MAP OR SAMPLE CONTRACT.
Before bidding, prospective purchasers should determine whether existing roads not included in the sale premise that they plan to use are available for log hauling.
4.
TIMBER VOLUMES AND RATES.
a. Timber Volumes. The quality, size, and age class of the timber are estimates based on detailed cruise information on file and available for inspection at the Forest
Service offices listed in the advertisement. INFORMATION LISTED IN SECTION A OF THE PROSPECTUS IS MADE AVAILABLE WITH THE
UNDERSTANDING THAT VALUES SHOWN ARE NOT ESTIMATES OF A PURCHASER'S OWN RECOVERY AND ARE NOT A PART OF THE TIMBER
SALE CONTRACT. For these reasons bidders are urged to examine the timber sale area and make their own recovery estimates.
b. Rates. THE MINIMUM ACCEPTABLE BID RATE IS STATED IN THE BID FORM AND IN SECTION A. THESE RATES ARE EFFECTIVE AT THE
TIME OF ADVERTISEMENT. The bid rate is based upon the pricing procedure provided by the timber sale contract. This rate has been established by appraisal
as though roads specified by the contract are in place. The Forest Service shall credit the purchaser's timber sale account as specified roads are constructed and
accepted.
Species subject to quarterly adjustment during the contract period are identified in A(AT)5a of the Timber Sale Contract.
The following is applicable for deficit sales with estimated specified road costs of $20,0000 or more: The appraised stumpage rates have been increased (by the
amount specified in Part A of the prospectus) to reach base rates. Provision C(T)4.1# applies to the timber sale contract for opted specified roads. This provision
requires that the stumpage rates paid by the small business purchaser include the full estimated construction or reconstruction costs of the specified roads included in
the contract in addition to the base rates shown in the sample contract.
If there is an insufficient value of timber at advertised rates to permit purchasers to recover the total estimated cost and normal profit and risk allowance, the amount
of insufficient value will be identified in Section A. The amount of unusable (ineffective) purchaser credit will also be identified in Section A.
The estimated Knutson-Vandenberg deposit for sale area improvement is specified in Section A. This amount is included in total timber value. Additional deposits
for slash disposal, road maintenance, or other associated charges are identified in Section A.
5.
PERIOD OF CONTRACT. The normal operating season and termination date are specified in Section A.
the purchaser has met specified conditions.
Extensions of this contract may be granted only when
The purchaser must submit a general operating plan to the Forest Service for approval before operations begin or within 60 days of sale award, whichever is earlier.
The plan must show how the purchaser plans to complete the contract by the termination date.
6.
PAYMENT. The purchaser shall make timber-related charges in advance of cutting, but may use established purchaser credit, transfer purchaser credit into the
contract, or use an acceptable payment guarantee to permit cutting in advance. The purchaser shall make advance deposits in accordance with C(CT)4.221 Advance Deposits of the timber sale contract.
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55.2 - Exhibit 02--Continued
Effective purchaser credit transferred from this sale that later turns out to be ineffective under this contract must be replaced with cash or transferred back.
This contract may require the purchaser to make deposits for the costs of Road Reconstruction and/or Road Reconstruction Engineering Services in accordance
with provisions CT5.121 and CT5.122. If such deposits are required, the amount will be shown in Section A of the Prospectus. Upon payment of the deposit,
an equal amount of Purchaser Credit will be established as earned under BT4.21.
The high bidder whose bid is accepted shall, at the time the contract is signed and returned by the bidder, make a downpayment pursuant to Title 36, Section
223.49, of the Code of Federal Regulations. The Contracting Officer will notify the high bidder of the amount necessary to make this payment. In no case shall
the downpayment be less than 10 percent of the advertised value plus 20 percent of the bid premium. The bidder may use effective purchaser credit to meet this
requirement. After receipt of the downpayment and a satisfactory performance bond and upon execution of the timber sale contract, the Forest Service will
return the bid guarantee.
2400-6 Contract: This downpayment shall not apply for any payments, transfer to other sales,or qualify for refund until 25 percent of the estimated
contract value at bid rates has been charged and paid for on the statement of account.
2400-6T Contract: This downpayment shall not apply for payments, transfer to other sales, or qualify for refund until 25 percent of the estimated
contract value at bid rates has been charged and paid for on the statement of account.
This contract contains special provisions CT9.4 - Failure to Execute Contract and CT4.220 - Downpayment, dated 4/94. They adopt the financial security
measures published in the Federal Register dated February 2, 1994, concerning repudiated sales. The bidder awarded this sale will have 30 days after receipt of
notification of award, to provide the executed contract, downpayment, and an acceptable performance bond. Failure to do so shall result in damages being
assessed as outlined in these provisions and the sample contract.
When the period between award date and termination date is more than one full Normal Operating Season, C(CT)4.264# will be included in the contract, and the
following will apply:
By the initial date specified in C(T)4.264# purchaser shall have paid for, or in lieu thereof, deposited cash in the greater amount of (1) 50 percent of the
total estimated bid premium, or (2) 35 percent of the total estimated value, at bid date, exclusive of required deposits, rounded up to the next $100. For
sales containing two full Normal Operating Seasons an Additional Periodic Payment is included. The amount of this "initial" payment will be reduced
if the payment would result in purchaser's credit balance for timber charges exceeding current contract value. By the Additional Periodic Payment date
specified the purchaser shall have paid for, or in lieu thereof, deposited cash in the amount of 75 percent of the total contract value at bid date, exclusive
of required deposits, rounded up to the next $100. Unused effective purchaser credit earned on the sale or transferred in may be used to meet this
requirement. The purchaser may not subsequently transfer such credit to another sale unless the credit is replaced by cash.
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If there is a delay in the award which affects the periodic payment determination date(s) included in Special Provision CT4.264# of the sample contract,
these dates will be adjusted to conform with the actual award of this timber sale contract.
C(T)8.212 has been included in this contract and provides for additional contract time (contract term addition) should certain adverse market conditions exist for
two consecutive calendar quarters after contract award date.
When the estimated construction cost (engineering estimate) of specified roads exceeds $20,000, qualified small business bidders may elect to have the Forest
Service construct specified roads. The contract will provide for collection of not less than the full estimated cost of the roads stated in the Section A in addition
to base rate value and required deposits.
2400-6 Contract: For scaled sales, the purchaser must pay the cost as timber is scaled, at a rate accelerated on 80 percent of the estimated volume.
2400-6T (Flat Rate Sales): The contract will provide for collecting the full estimated cost of roads based upon premeasured volume.
2400-6T (Escalated Sales): The contract will provide for collecting the cost as each payment unit is released for cutting.
7.
PERFORMANCE BOND. A performance bond is mandatory. The penal sum of the bond will be 10 percent of the total bid value of the sale rounded up to the
nearest $100 when the total bid value is $10,000 or less, and rounded up to the nearest $1,000 when the total bid value exceeds $10,000. The maximum bond will be
$500,000. The minimum bond requirement will not be less than the estimated costs of postlogging purchaser requirements. For helicopter sales, the following
guides will apply:
Ten percent of the contract bid value or 25 percent of the total merchantable timber yarding costs plus 50 percent of any cost for yarding or piling unutilized
material, whichever is greater.
8.
SPECIFIED ROADS. See sample contract for verification of specific details and information concerning construction specifications. CONSTRUCTION
ESTIMATES AND INFORMATION CONTAINED HEREIN, TOGETHER WITH RELATED MATERIAL, ARE NOT GUARANTEED. In addition, see Section
A for a list of roads that the Forest Service considers necessary to remove the timber from this sale.
If the estimated construction cost of specified roads exceeds $20,000, a bidder qualifying as a small business concern may elect to have Forest Service construct
specified roads. Completion dates for construction shall apply whether construction is performed by purchaser or Forest Service. If bidder elects Forest Service
construction, it is Forest Service's intent to perform construction through contract. In that case, the Forest Service shall not award the timber sale contract unless
either it receives a satisfactory road construction bid or, if it fails to receive such a bid within the number of days specified in Section A of the Prospectus of opening
timber sale bids, the bidder agrees to perform the road construction.
In some cases, the contract may require construction of a road(s) to a design standard higher than that needed to log the sale (Public Law 88-657, section 4). The
purchaser may elect to have the Forest Service construct such road(s). Completion dates for construction apply whether construction is performed by the
purchaser or the Forest Service. If a nonsmall business purchaser elects
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Forest Service construction, the purchaser shall deposit the amount specified in section A of the prospectus with the Forest Service for the purchaser's share of
the cost of the road(s). Such deposits count as earned purchaser credit in accordance with the timber sale contract. If the purchaser elects to construct the
road(s), Section A of the Prospectus identifies the amount in cash or materials that the Forest Service will pay the purchaser as well as the amount that shall
become purchaser credit in A(T)10 of the sample timber sale contract.
In some cases there may be insufficient value of timber at advertised rates to permit the purchaser to apply the full amount of purchaser credit. If an insufficient
value of timber is still indicated after including the bid premium following sale award, and purchaser elects to perform road construction, the Forest Service may
offset the deficit in whole or in part by providing contributed funds. The offset may be in the form of materials needed in construction of specified roads in the
sale and/or cash. The maximum value of cash and/or materials (if any) that the Forest Service can provide to offset the deficit is listed in section A of the
prospectus. The Forest Service shall decrease the amount of contribution by an amount equal to the bid premium. This change will occur during preparation of
the contract for signature.
If an insufficient value of timber is still indicated after including the bid premium following sale award and high bidder elected to have the Forest Service build
the road, the Forest Service will not offset the deficit with contributed funds (cash or materials).
9.
INAPPLICABLE STANDARD PROVISIONS. See sample contract.
10. SPECIAL PROVISIONS. See sample contract.
11. FINANCIAL ASSISTANCE. The Small Business Administration (SBA) may be able to assist small business concerns in financing construction of specified roads
listed in the sample timber sale contract. Such SBA assistance, if available, may be in the form of guaranteed bank loans or direct participation SBA loans.
Applicants must meet SBA size and eligibility requirements. APPLICANTS MUST ALSO MEET CREDIT REQUIREMENTS OF SBA AND/OR A LOCAL
BANK. APPROVAL OF LOAN ASSISTANCE RESTS WITH SBA AND IS CONTINGENT ON AVAILABILITY OF LOCAL OR SBA FUNDS. FAILURE
TO BE ELIGIBLE OR TO OBTAIN A LOAN WILL IN NO WAY AFFECT REQUIREMENTS OF BID FOR ADVERTISED TIMBER OR TIMBER SALE
CONTRACT. If requested by the purchaser, the timber sale contract can provide for repayment of direct SBA loans through Forest Service as the timber is cut.
12. SET-ASIDE SALES. If this sale has been identified in section A of the prospectus as a set-aside sale, preferential award to a small business concern is authorized by
Section 15 of the Small Business Act of 1958. Any bidder who desires preferential consideration for award as a small business must certify this status as specified
on the bid form. A bidder that does not certify status as small business prior to bidding can be qualified for sale award, or for further participation in oral bidding
only in the absence of a valid sealed bid from a small business concern. In the absence of any bids, the sale may be made to a concern without limitation as to size
under Title 36, section 223.102, of the Code of Federal Regulations. The bidder must agree not to sell more than 30 percent of the advertised sawtimber volume
included in this sale to firms not qualifying as small businesses under section 15 of the Small Business Act.
If this sale has been identified in Section A of the prospectus as an SSTS set-aside sale, preferential award of this sale to a small business concern is authorized by
section 15 of the Small Business Act of 1958. Firms eligible for such preferential bidding must have 25 or fewer employees and must certify their status in
accordance with instructions enclosed with the bid form. The high bidder's size status
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55.2 - Exhibit 02--Continued
is subject to verification by the Small Business Administration (SBA). A small business that does not qualify for the program must obtain a recertification of
size from SBA before self-certifying again for small business set-aside. A bidder who does not certify his status as a small business for this program will be
qualified for sale award or for further participation in oral bidding only in the absence of a sealed bid from a qualified small business concern.
13. LOG EXPORT RESTRICTIONS. The contract requires domestic processing of included timber, except for species declared to be surplus, and prohibits the use of
such included timber in substitution for unprocessed private timber exported. These restrictions are based on Section 223.160, of Title 36 of the Code of Federal
Regulations and the Forest Resources Conservation and Shortage Relief Act of 1990 (P.L. 101-382) to which this contract is subject. See the sample contract for a
copy of Special Provision C(T)8.641# - Use of Timber (9/90).
Section 490(a) of the Forest Resources Conservation and Shortage Relief Act of 1990 prohibits any person from purchasing directly, from any department or agency
of the United States, unprocessed timber originating from federal lands west of the 100th meridian in the contiguous 48 states, if such timber is to be used in
substitution for exported timber originating from private lands, or such person has, during the previous 24-month period, exported unprocessed timber originating
from private lands.
Pursuant to Section 490(a), until such time as the regulations to carry out this subsection are issued under Section 495, direct substitution under this contract shall be
governed by existing regulations in Title 36 of the Code of Federal Regulations, Subpart D - Timber Export and Substitution Restrictions. The provisions of 36 CFR
223.87 require a bidder to submit a signed certification and report with each bid. To meet this requirement, Form FS-2400-43, Certification of Domestically
Processed and Exported Timber, is provided as part of the bid packet. Failure to include this form, SIGN THE FORM IN THE SIGNATURE BLOCK
CONTAINED AT THE BOTTOM, and to complete the certification for the previous calendar-year portion of PART I, constitutes a nonresponsive bid.
If previous calendar-year data required on form FS 2400-43, part I, are not yet available, the bidder must certify in part I under item 2c the following: "CY 19
information is currently not available and will be provided by March 1 of this year." The Forest Service will not award the sale until the required information is
provided.
14. EQUAL EMPLOYMENT OPPORTUNITY COMPLIANCE REVIEW. If the total bid value plus required deposits for this contract exceeds one million dollars
($1,000,000), before the award, the Forest Service shall request an equal employment opportunity compliance review of the high bidder to determine compliance with
the provisions of Executive Order 11246 of September 24, 1965, as amended by Executive Order 11375 or October 13, 1967.
15. AWARD. The Contracting Officer is required to make a determination of financial ability as stated in Title 36, Section 223.103, of the Code of Federal Regulations.
If the high bidder has one or more defaulted timber sale contracts with undetermined, disputed, or unpaid damages, the bidder may be required to furnish information
or securities sufficient to document its financial ability prior to award of the contract.
16. GENERAL:
a . Urgent Removal Sales. If the timber in the sale being offered has been identified in section A of the prospectus as being in urgent need of harvesting,
contract term adjustments may be granted on other National Forest sales on which operations must be delayed in order to remove this material. The
decision as to which sales will be eligible for adjustment will be based on the following criteria:
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1.
Sale must be within or adjacent to the XXXXXXXX National Forest.
2.
Impact caused by delay in harvest must be shown.
3.
Sales which are primarily high risk lodgepole pine sales or salvage sales are excluded from consideration.
The number of days of contract term adjustment a purchaser may expect to be granted will be calculated on a case-by-case basis and will reflect the time lost
while logging the salvage sale.
b.
Financial Ability. In accordance with 36 CFR 223.103 the Contracting Officer may require the apparent high bidder to furnish a satisfactory showing of
financial ability before award of this sale will be made.
c.
Payments. All payments relating to this contract with the exception of the Bid Guarantee, will be made to the address reflected on the Bill for Collection.
In most cases, this is a Post Office box in San Francisco, California.
d.
Irrevocable Letter of Credit. Prospective purchasers planning to secure a timber sale contract bid, payment, and/or performance bonds with an Irrevocable
Letter of Credit should contact the Forest Office named in the attached advertisement for guidance in forms preparation prior to their submission of bid.
e.
Special Provisions CT8.211. Delay of Award (8/88) and CT9.51 - Settlement (8/88) are included in the Timber Sale Contract. Prospective purchasers
should be aware of the stipulations of these provisions related to the liability in the event the award of this contract is terminated in whole, or in part, by the
Forest Service.
f.
Changes in Sanple Contract. The following changes will be made to the Sample Contract when Forest Service constructs specified roads.
A Division
A(AT)9. Title will be changed to: "Permanent Roads to be Constructed By Forest Service."
A(AT)10. Title will be changed to "Purchaser Credit."
A(AT)11 and A(AT)12. Will be deleted and replaced with new pages. "None" will be added as appropriate.
AT20 and A23. The following changes will be made:
C(CT)2.32
C(CT)2.323
C(CT)4.1#
C(CT)5.2
C(CT)8.41
"Construction Clearing," will be added.
"Removal of Right-of-Way Timber," will be added.
"Amount Payable for Timber," will be added.
"General Provisions," etc., will be removed.
"Limitations of Performance by Other than Purchaser" will be added.