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and in that event the City agrees to pay the same. The City further <br />agrees to pay any and all claims or demands of any kind or nature <br />whatsoever arising out of or incidental to the performance of the <br />work under any contract let for said projects in the event that the <br />United States does not pay the same, and in all events, agrees to <br />save the State of Minnesota and the Commissioner from said claims <br />and from any claims arising out of this agreement and to pay any and <br />all expenses and costs connected with said projects or the <br />construction thereof which the United States does not pay. <br />-VII - <br />The City further agrees that: <br />A. All right -of -way acquisition and relocation will be conducted <br />in accordance with 49 CFR Part 25. Procedures implementing this <br />regulation are contained in Mn /DOT State Aid Manual Chapter 5- <br />892.310. <br />(Additional guidance may be obtained by referring to the FHWA's Real <br />Estate Acquisition Guide for Local Public Agencies). <br />B. If the City receives total direct and indirect federal <br />assistance of: <br />1. $100,000 or more per year, the City agrees to obtain a <br />financial and compliance audit made in accordance with the Single <br />Audit Act of 1984 (P.L. 98 -502) and Office of Management and Budget <br />(OMB) Circular A -128. The law and circular provide that the audit <br />shall cover the entire operations of the City government or, at the <br />option of the City government, it may cover departments, agencies or <br />establishments that received, expended, or otherwise administered <br />federal financial assistance during the year. However, <br />Page 10 <br />