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26, shall have the opportunity to participate in the performance of contracts financed in whole or <br /> in part with federal funds. Consequently, the DBE requirements of 49 C.F.R. 26 and City's DBE <br /> program apply to this contract as follows: <br /> (a) If Sub-Recipient makes use of any subcontractor, it will strive to meet the <br /> annual DBE goal by offering DBEs,as defined in 49 C.F.R.26, Subpart A,the opportunity <br /> to compete fairly for contracts and subcontracts. If subcontractors are used, DBE <br /> participation shall be reported monthly. <br /> (b) Sub-Recipient and any subcontractor shall not discriminate on the basis of <br /> race, color, national origin or sex in the award and performance of contracts. <br /> (c) The requirements in this Section 5.2 shall be included in any subcontract. <br /> (d) Failure to carry out the requirements set forth above shall constitute a <br /> material breach of this Agreement. <br /> 5.3 Sub-Recipient shall be solely responsible for the performance of all subcontractors <br /> and the fulfillment of all requirements of this Agreement. City has privity of contract with and will <br /> recognize only the Sub-Recipient. <br /> 5.4 Sub-Recipient shall assure that each of its subcontractors fully and properly <br /> perform their work under the subcontract. <br /> 5.5 Sub-Recipient agrees that this section does not operate to relieve it of any duty or <br /> liability under this Agreement, nor does it create any duty or liability on the part of City to any <br /> subcontractor. Sub-Recipient shall have sole responsibility for promptly settling any disputes <br /> between subcontractors and between Sub-Recipient and any subcontractor. Upon request of City, <br /> Sub-Recipient shall provide City with information regarding the status of any disputes involving <br /> any of its subcontractors. <br /> 5.6 Sub-Recipient shall pay its subcontractors on a timely basis, for and on account of <br /> work performed by such subcontractors, in accordance with the terms of the respective <br /> subcontracts and in accordance with applicable State and Federal law. Upon written request of <br /> City, Sub-Recipient shall provide City with information regarding the current status of payments <br /> to subcontractors, including the reasons for any non-payment. <br /> VI. ACCOUNTING AND AUDIT REQUIREMENTS <br /> 6.1 In compliance with applicable Federal laws,regulations, and directives, and except <br /> to the extent that FTA determines otherwise in writing, Subrecipient agrees as follows: <br /> (a) Sub-Recipient agrees to establish and maintain for the Project either a <br /> separate set of accounts or separate accounts within the framework of an established <br /> accounting system that can be identified with the Project. Sub-Recipient also agrees to <br />