SECTION 938 — PRICE ADJUSTMENTS 900-107 — PRICE ADJUSTMENTS
938.01 Description.
This provision ensures adequate and fair compensation for unpredictable and fluctuating costs that, from time to time, occur in the prices of liquid asphalt, diesel fuel , and steel, as described below.
938.02 Definitions.
Base Price of Liquid Asphalt and Diesel Fuel. The base price is the unit price of the material (FOB Terminal) as determined by the Department. The base prices for liquid asphalt and diesel fuel will be determined just before the first date that the NOTICE TO CONTRACTORS is advertised in the public press. Period Price of Liquid Asphalt and Diesel Fuel. The period prices for liquid asphalt and diesel fuel (FOB Terminal) will be determined for any one-month period following the NOTICE TO PROCEED during which the price varies from the base price. Base Price (BP) for Steel. The base price for steel will be determined by the Department just before the first date that the NOTICE TO CONTRACTORS is advertised in the public press. Period Price Index (PPI) for Steel. For all steel items, the PPI will be defined as the Bureau of Labor Statistics (BLS) Producer Price Index (PPI) for “Steel Mill Products, ” Series ID WPU 1017- 02 (not seasonally adjusted). The latest version of the index will be used, including any corrections or rebasing of the index. PPI will be defined as the BLS PPI at the time the material is purchased from the mill, as specified by the Invoice date. Base Price Index (BPI) for Steel. For all steel items, the Base Price Index (BPI) will be defined as the BLS PPI just before the first date that the NOTICE TO CONTRACTORS is advertised in the public press. Period Price (PP) for Steel. The period price for steel will be calculated as follows: PP = (BP × (PPI/BPI)).
Part 900 — Incidental Construction and Services August 2025
900-108 SECTION 938 — PRICE ADJUSTMENTS
938.03 Price Adjustment.
Price adjustments for liquid asphalt and diesel fuel will be determined by the difference between the period price and the base price. Price adjustments for liquid asphalt and diesel fuel will be made at the end of each month during which a) work was accomplished on the P roject, and b) prices varied. Price adjustments for steel will be calculated every month that steel is purchased, but only applied when steel price indices vary by more than 5.0 percent. Price adjustments for work performed after the Contract completion date, including approved time extension(s), will be as follows: Credit due the Contractor will be the lesser amount calculated from the following two algorithms (a and b), whereas credit due the Department will be the greater of the two calculations:
a.Actual Monthly Period Prices. The price adjustment calculated using the actual monthly period prices in effect at the time of the construction.
b.M onthly Period Prices in Effect . The price adjustment calculated using the monthly period prices in effect during a period determined by setting the last day of relevant work to the Contract completion date as may have been modified by approved time extension(s). Price adjustments due the Contractor will be made according to an approved Contract Addendum. Credit due the Department will be processed by deducting monies from progress payments or by other means if there are insufficient progress payments remaining. Asphalt Binder. The asphalt content will be the optimum amount used in every ton of asphalt concrete mixture, as determined by the Department ’s Materials Engineer, using the method for determination of optimum binder content as set forth in SECTION M03. The price adjustment will be determined by multiplying the total weight of asphalt binder, in tons, by the difference between the base price and period price. The base price of asphalt binder is set forth in Special Provision Code 938.1000. Diesel Fuel. The fuel for operating the plant and the fuel for hauling and placing asphalt concrete will equal the total number of tons of asphalt concrete placed during the month in question times a fuel adjustment factor of 2.5 gal of fuel per ton of asphalt concrete. Tonnage of asphalt concrete placed during the month in question will equal the sum of the weights indicated on the Daily Automated Recordation printout slips provided at the plant. The price adjustment will be determined by multiplying the total volume of fuel, in gallons, by the difference between the base price and the period price. The base price of diesel fuel is set forth in Special Provision Code 938.1000.
Part 900 — Incidental Construction and Services August 2025
SECTION 938 — PRICE ADJUSTMENTS 900-109 Steel. Steel price adjustments will apply only when specified in the Contract and only to unfabricated structural steel material, consisting of rolled shapes, plate steel, sheet piling, pipe piles, steel castings, steel forgings, and unfabricated reinforcing steel bars. Payments will only be made for fluctuations in the cost of the steel material used in the items specified. Steel price adjustments will not be made to steel purchased before the time of bid opening for conventional contracting methods (design/bid/build) or submittal of price proposals for all other contracting methods. Steel price adjustments will not include the costs of S hop Drawing preparation, handling, fabrication, welding, erection, surface preparation, coatings, transportation, storage, staging, installation, profit, overhead, fuel costs, fuel surcharges, or other charges not related to the cost of the unfabricated structural steel and unfabricated reinforcing steel. The weight of steel subject to a price adjustment will be calculated based on approved Shop Drawings and incorporated into the final Work. For all steel items specified above, the price adjustment will be determined according to thresholds as follows: • If the absolute value of [(PP-BP)/BP] is less than or equal to a threshold of 0.050, then no price adjustment is made. • If the absolute value of [(PP -BP)/BP] is greater than 0.050, then a price adjustment is made and will apply to the full variance between the base price and the period price. • If the threshold is exceeded and the PP is higher than the BP, the price adjustment owed to the Contractor is calculated as follows: [PP – BP] × Weight of steel • If the threshold is exceeded and the PP is lower than the BP, the price adjustment owed to the Department is calculated as follows: [BP – PP] × Weight of steel The base price of steel is set forth in Special Provision Code 938.1000.
938.04 Method of Measurement.
Pay adjustments will be measured using the Method of Measurement for the applicable Item to be adjusted.
938.05 Basis of Payment.
Pay adjustments will be paid per each unit for the applicable Item to be adjusted.
Price Adjustments in other states
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Source: Standard Specifications for Road and Bridge Construction (Blue Book), 2022 (Aug 2025 compilation) Edition. Pages 714–716 of 951. View official source ↗