JULY 2005
SOLICITATION FOR OFFERS
OUTPATIENT CLINIC
SFO NO. V101-183R-xxx-xxx-xx
[INSERT LOCATION OF FACILITY]
4. FUNDED MAINTENANCE ACCOUNT (FMA):
a. The Lessor shall establish a FMA as set forth in Paragraph 3. The account shall be used to
provide maintenance to the lease premises throughout the term of the lease, including all renewal
options, and to make all necessary capital repairs and replacements.
b. Failure by the Lessor to make the quarterly FMA payments required within Paragraph 3 shall
constitute an Event of Default by the Lessor, as defined in Paragraph 5. In such instance, the
Government's remedies shall be those as set forth in Paragraph 6.
c.
Should the cost of any capital repair, replacement, or maintenance be in excess of the funds in
any specific category within the FMA, the Lessor shall fund the difference for that item. The
Lessor will not be permitted to use funds in the FMA to pay for out-of-cycle repair or replacement
of any item identified in the FMA without written approval by VA.
d. The Lessor shall submit in writing to the CO or his/her designee a quarterly report regarding the
funding status of the FMA. Such report shall begin with the establishment of the FMA, and,
thereafter, coincide with the Lessor's quarterly payments to the FMA. The report shall include
evidence of all deposits to and withdrawals from the FMA and shall identify reasons for each
expenditure for maintenance, repair, and replacement made to the clinic building or grounds. The
Department of Veterans Affairs reserves the right to audit the FMA records at any time. Such
records will be made available to an individual designated by the CO within seven (7) days of
written request.
e. At the beginning of the second year and all subsequent years of the lease term, including all renewal
options, the Lessor or designated property management firm shall be required to submit an annual
operating budget estimate. The budget estimate shall include monthly obligation plan by category,
as similarly identified in the original FMA Worksheet submitted with the Lessor's offer, for review and
approval by VA. The budget estimate and obligation plan will forecast costs of all operating
expenses for maintenance, refurbishment, repair, and capital replacement required for the ensuing
year.
f.
Shortfalls to cover any unforeseen maintenance expenditure in any specific category will be the
responsibility of the Lessor. No withdrawals from any category beyond the operating budget
obligation plan for that category will be allowed without written approval by VA. At the beginning of
the second year and all subsequent years of the lease term, the Lessor will be allowed to adjust
his operating expenses (Line 27 of GSA Form 1217 and Part I of the FMA Worksheet) to reflect
increases in operating costs.
g. Once the annual budget is approved, VA's rental rate will be adjusted up or down as necessary to
cover the cost of expenses for the ensuing year after accrued interest has been applied. The
submission of the annual operating budget estimate and obligation plan shall occur on the
anniversary date of the acceptance of the leased premises by the Government.
h. At the end of VA's lease term, including all renewal options, the remaining balance in the FMA
account will be released to the Lessor, and the Government will make no claims against the
remaining funds.
5. EVENTS OF DEFAULT BY LESSOR:
An Event of Default by the Lessor shall occur upon its failure to perform or observe any covenant or
condition required by Lease No. V101-183R-xxx-xxx-xx, including all attachments hereto, and if such
failure is not cured to the satisfaction of the Government within fifteen (15) days of receipt of written notice
thereof. Such cure period may, at the sole discretion of the Government, be extended in writing if such
Part II Schedule A Page 8 of 9
Lessor __________ Gov't. __________
__________ of __________ Pages
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