HomeMy WebLinkAbout4.04 CIP Change Orders PolicySoo-z~
CITY OF DUBLIN
AGENDA STATEMENT
City Council Meeting Date,: February 8, 1988
SUBJECT: Policy for Approval of Contract Change Orders
EXHIBITS ATTACHED: Resolution
Letter from Harris and Associates dated 1/21/88
RECOMMENDATION ~~~!_ ' Adopt Resolution Establishing Policy
FINANCIAL STATEMENT: None
DESCRIPTION:
In the past, the City Manager has delegated the responsibility of
approving change orders for projects under the City's Capital Improvement
Program to the City Engineer. This has worked satisfactorily until this point
in time, as the projects and their respective change orders have been
relatively small. The City Council has received reports at the end of each
project detailing the actual costs as compared to budgeted amounts. When a
significant change has arisen, such as the $20,000 change order regarding the
reconstruction of Amador Valley Boulevard at the railroad tracks, Staff has
asked the City Council to review and approve the change order in advance.
Now that the City is undertaking the Ci-:.~ Center project at a cost of
over $9 million, it is prudent to set up guid~~:i-_zes for change order review
and approval, not only to insure that the proj~:~:t proceeds without City-
generated delays, but also to monitor the sizeaale costs involved in the
project.
The policy is, however, set up to handle all Capital Improvement
Projects, not only the Civic Center.
The proposed policy would allow the City Manager or his designee to
approve change orders up to a cumulative net increase of $25,000 for projects
with a bid total of $500,000 or less; and to approve change orders up to
$25,000 each, to a cumulative net maximum of 5~ of the project bid amount, for
projects over $500,000. All change orders exceeding the City Manager's limit
of authority would be referred to the City Council for approval.
The Finance Director will keep a running total of all approved change
orders and will report to the City Council on a regular basis to keep the City
Council informed of approved change orders for each project.
ITEM N0. '~ ,.'~'~ COPIES T0:
RESOLUTION N0. -88
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
ESTABLISHING A POLICY RELATED TO CONTRACT CHANGE ORDERS
FOR CAPITAL IMPROVEMENT PROJECTS
WHEREAS, Capital Improvement Projects at times require change
orders after the contractor's bid has been accepted by the City Council; and
WHEREAS, it is prudent and reasonable to establish a policy for
approval of change orders;
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City
of Dublin adopts a policy for approval of Capital Improvement Project change
orders, said policy to be as follows:
1) For the purposes of this Policy:
a) The project cost shall be the bid amount accepted by the
City Council including any accepted alternates except as may be modified by
the City Council at the time of bid award.
b) Total amount of change orders shall be the net increase of
all change orders, including increases and decreases.
2) For projects which cost is $500,000 or less, the City Manager or
his designee is authorized to approve contract change orders up to a
cumulative total of $25,000.
3) For projects which cost exceeds $500,000, the City Manager or his
designee is authorized to approve contract change orders up to a limit of
$25,000 each, or a cumulative increase of 5$ of the contract cost. The City
Council will review and have the right of approval for change orders exceeding
the City Manager's authorized limit.
PASSED, APPROVED, AND ADOPTED this 8th day of February, 1988.
AYES:
NOES:
ABSENT:
Mayor
ATTEST:
City Clerk
CONSULTING ENGINEERS
k~',
• ~
HARRIS
6L ASSOCIATES
CONSTRUCTION MANAGERS
January 21, 1988
Letter No. F-03
City of Dublin
6500 Dublin Boulevard
Dublin, California 94568
Attention: Mr. Richard Ambrose, City Manager
Re: DUBLIN CIVIC CENTER PROJECT
RECOMMENDATION TO CITY COUNCIL FOR CONTRACT CHANGE ORDER
PAYMENT APPROVAL
REFERENCE MEETING ON JANUARY 11, 1988
Gentlemen:
At the above referenced meeting, we briefly discussed how we
would deal with changes on the Dublin Civic Center Project. This
letter will reiterate the Contract Change Order process discussed
and provide language for a recommendation to the City Council for
payment approval authorization for Contract Change Orders.
Changes which arise on the project, whether generated by the
Contractor, Architect or City of Dublin, will be handled by the
Construction Manager through the use of a Request For Quote (RFQ)
to the Contractor. The Contractor will review the RFQ and
provide a price to do the proposed work. The Construction
Manager will do an independent estimate to determine the value of
the work and review the cost submitted by the Contractor. The
Construction Manager will then meet with the Contractor and
negotiate a final price for the change. Once the price is agreed
upon, the Construction Manager will issue a Contract Change
Order. The Construction Manager will sign the change. order
recommending that this change be approved by the Owner, then the
Contractor will sign the change order agreeing to do the work
described at the price indicated, and finally the City will sign
the change order to approve payment for the change order.
To enable the change order process to run smoother and to not
require going to the City Council to authorize payment for each
change order issued on the project, we recommend that the City
Council authorize the City Manager to sign change orders on the
Dublin Civic Center project up to $25,000. For changes over
$25,000, we recommend that the City Council require prior
220 MASON CIRCLE ^ CONCORD, CALIFORNIA 9-}520 ^ (415) 527--I9th~
~~',
Mr. Richard Ambrose
Page Two
January 21, 1988
approval before the
of the final change
change order.
Contract Change Order is issued and approval
order prior to the City Manager signing the
Another important function of the Construction Manager during the
changer order process is to keep the City informed, so they
understand the change required prior to signing the Contract
Change Order. To keep the City informed, we will provide a list
of all changes for the project which indicates the status of each
item. This list can be incorporated into the agenda for council
meetings to keep the council informed as well. On larger
changes, the City will have greater involvement and provide their
input into the change order process. We also will provide a
written monthly Construction Managers report to keep the City
Council informed of the status of the project as a whole.
If you have any questions or comments, please contact us.
Very truly yours,
HARRIS & ASSOCIATES
Susan C. Hyler P.E.
SCH:sch
8709-11 '
cc: '~Mr. Paul Rankin, Assistant to City Manager