Part 1 — General
1.1 Section Includes
A.Provisions for making changes to the contract during execution of the contract
B.Determination of additional time and compensation for changed and extra work .
1.2 Related Sections
A.Section 00570 : Definitions
1.3 References
A.UDOT Partnering Field Guide
B.Equipment Watch – Rental Rate Blue Book
1.4 Definitions
A.Burdened Wages - Includes wage plus payroll taxes, retirement benefits, health benefits, worker's compensation, life insurance, pensions and other fringe benefits.
B.Claim – A request for compensation, time adjustment or both for a disputed change that has been escalated to the Department’s Region Director and remains unresolved.
C.Design Change – A revision to the contract issued by the Department directing the Contractor to proceed with new or revised work including an intended payment methodology for the new or revised work
D.Direct Cost - T he costs of materials, labor, equipment and all directly involved efforts or expenses for the cost object.
E.Construction D eviation - A waiver of a contract requirement that may include instructions or interpretations
1.Construction D eviation s do not involve adjustment to the contract value or time duration.
F.Excusable Delay – A delay that is beyond the Contractor’s control, not the fault or responsibility of the Contractor, or could not have been foreseen by the Contractor, for which a time extension will be granted.
1.Compensable Delay
a.Caused by the Department’s action or inaction, or under the Department’s control, including delay s resulting from change orders , lack of site access, and delayed shop drawing authorization .
b.Differing site conditions and third- party utility work delays caused by conditions beyond the control of the Contractor.
2.Non-compensable Delay – Unforeseen and unanticipated excusable delay caused by force majeure or delays not the fault of the Contractor or Department. a. Concurrent Delay – A delay that occurs when both the Contractor and the Department independently delay work on critical path activities during approximately the same time period.
G.Field Indirect Cost - All costs which are required for completion of the installation, but are not directly attributable to the cost object are considered indirect costs, such as overhead, field supervision and vehicles
H.Force Majeure – An unforeseeable event or circumstance that is beyond the control and without the fault or negligence of the Contractor. The Contractor by the exercise of reasonable diligence was unable to prevent, which by way of illustration can include, but is not lim ited to the following:
1.Tornados, earthquakes, 50- year floods, fire or other physical natural disaster;
2.Riot, war, invasion, act of foreign enemies, hostilities, acts of terrorism, civil war or rebellion .
3.Any epidemic or quarantine restrictions occurring within the vicinity of the Project.
4.A blockade or freight embargoes .
5.Strike s or industrial disputes by labor not employed by the affected party, its subcontractors or its suppliers and which affect an essential portion of the works but excluding any industrial dispute which is specific to the performance of this agreement.
I.Non-excusable Delay – A delay that is within the Contractor’s control, is the fault or responsibility of the Contractor, or can be reasonably foreseen by the Contractor and for which there is no monetary compensation or time extension. 1. Examples of such delay -causing events are normal weather or the failure by the Contractor to assign sufficient resources to the work.
J.Potential Change Order (PCO) – A risk that may result in a request for equitable adjustment in cost or time if said risk is realized.
K.Request for Change Order (RCO) – A written request by the Contractor to change the contract in response to unforeseeable conditions, design changes, and change directives.
L.Significant Change in the Character of Work - Work that differs materially in kind, quantity, or nature from that involved or included in the original contract.
1.Alteration or change can be significant changes to the character of work or by their effect cause other work to become significantly different in character.
M.Small Tools – handheld, portable device used for various manual tasks, typically manageable in size and designed for specific applications, like shovels, wr enches, screwdrivers, pliers, hammers, saws, and drills .
N.Unburdened Wages – Base salary not including payroll taxes or benefits.
O.Value Engineering Change Proposal (VECP) - A proposed substitution of material or change to the work that may potentially result in cost or time savings and preserve essential functions and characteristics of the facility such as: service life, economy of operation, ease of maintenance, desired capacity, and safety.
1.5 Submittals
A.Claims (if applicable) – Refer to this Section , for information
B.Request for Construction D eviation (if applicable) , for approval . – Refer to this Section, Article 1.8
C.Potential Change Order (if applicable) , for information . – Refer to this Section, Article 1. 10
D.Request for Change Order (if applicable) , for approval. Refer to this Section, Article 1.11
E.Value Engineering Change Proposal (if applicable) , for approval. Refer to this Section, Article 1.15
1.6 Contract Modifications
A.General
1.The Engineer reserves the right to make, at any time during the work , changes in quantities and alterations in the work as are necessary to satisfactorily complete the project.
a.Only the Engineer has authority to direct a change to the contract.
b.Additional requirements from determinations, approvals, and authorizations of the Engineer are included in the contract and not considered significant changes in the character of work .
c.Changes in quantities and alterations do not invalidate the Contract nor release the Surety.
d.The Contractor agrees to perform the work as altered.
2.Changes and alterat ions may include among others:
a.Deleting any part of the work .
b.Increasing or decreasing quantities .
c.Altering specifications , designs, or both.
d.Altering the way the work is to be done.
e.Adding new work .
f.Altering facilities, equipment, materials, services, or sites, provided by the Department.
g.Ordering the Contractor to accelerate or delay the work .
3.The contract sum or time can be adjusted only by written change order.
4.Do not perform work considered a change to the contract without receiving approval from the Engineer.
B.Documents
1.Refer to Table 1 for documents and procedures that define the methods of modifying the contract. Table 1 Types of Contract Modifications Document Procedures Results Construction D eviation Requested by the Contractor. Evaluated by the Engineer. An allowed deviation from contract plans and spec ifications at distinct location Design Change Issued by the Engineer. The Contractor executes the change. The Contractor may submit a Request for Change Order if the payment methodology for the work change is not agreed to. Potential Change Order Prepared by the Contractor. Evaluated by the Engineer. The Contractor submits the effects of the potential change on contract cost, contract time, or both. Request for Change Order Issued by the Contractor. Evaluated by the Engineer. A change order is issued if the Engineer agrees to the terms and conditions of the request. Change Order (CO) Prepared by the Engineer. Agreed to and signed by the Contractor and then the Department Contractor. Documents changes in the contract price and time. Value Engineering Change Proposal (VECP): Prepared by the Contractor. Evaluated by the Engineer. Change Order is executed if terms and conditions are agreed to. Cost savings is shared equally.
1.7 Insurance Claims
A.Determine whether insurance proceeds from Contractor’s required insurance(s) are available to cover costs in connection with the item prior to filing any request for a change order.
1.Pursue reimbursement of costs through insurance, if available.
B.Notify the Department when filing an insurance claim within 20 calendar days of filing the insurance claim.
C.Submit a Potential Change Order for all insurance claims filed.
1.8 CONSTRUCTION DEVIATION A. Request a Construction D eviation to the contract documents when a
deviation of a requirement is being sought prior to the work being performed.
1.Describe the exact contract requirement to which a construction deviation is desired
B.The Engineer may grant a singular construction deviation to a specification or drawing at their discretion if such deviation is deemed to not affect the value of the product.
1.An approved construction deviation does not change the requirements for the project as a whole.
a.A change of the requirements for the project as a whole must be completed by a change order.
C.Comply with the requirements in the a pprov ed Construction deviation.
1.9 Notice of Design Change (Ndc)
A.The NDC is a design change issued by the Department that describes any desired change in the work and states the method of payment.
1.Direction by the Engineer will be issued through an NDC .
B.The issuance of a NDC does not necessitate the issuance of a change order.
1.Proceed immediately with the work if the Department’s proposed method of payment is acceptable.
C.Submit a Request for Change Order ( RCO) within 7 days of receiving the NDC if the Department’s proposed method of payment is unacceptable.
1.10 Potential Change Order (Pco)
A.Notify the Engineer with a PCO that an event or situation resulting in a contract change is likely to occur.
1.State if additional time or compensation or both may be requested if the event or situation occurs .
B.Include at least the following in the PCO :
1.F acts underlying the Potential Change Order and the reasons why additional compensation or time may be due.
2.B asis that the work is not required by the Contract, if applicable.
3.Particular elements of Contract performance for which additional compensation may be sought .
4.P otential impact to the critical path affecting a Completion Deadline.
5.A n estimate of the time within which a response to the notice is required to minimize cost or performance delay .
C.Notify the Department within ten days of the occurrence of an event that initiates need for a change order as specified in this Section, Paragraph 1.11 A.
1.Failure to issue a notification within ten calendar days of when the change, condition, or event is discovered or should have been discovered in the exercise of reasonable prudence may limit any contract adjustment, when warranted, to those costs or impacts incurred after notification is received by the Engineer.
2.Failure to provide required notification constitutes a waiver for any claim resulting from the alleged change, condition, or event.
1.11 Request for Change Order (Rco)
A.The Contractor may request a contract change for the following:
1.An excusable delay to extend contract time and compensate for associated delay costs .
2.Differing site conditions , when unforeseen condition or event s, or new work is added that result s in a request for additional compensation or time.
3.A significant change in the character of the work when a quantity variation in a major contract item of work significantly changes how the work would be performed resulting in an increase or decrease in efficiency .
B.A Request for Change Order (RCO) begins the administrative process for Change Orders.
C.The RCO must reference a PCO or include the following :
1.D etail the facts underlying the RCO, the reasons why additional compensation or time will be due and the date of event occurrence;
2.D etail the basis that the work is not required by the Contract;
3.Particular elements of Contract performance for which additional compensation may be sought :
a.Pay items that have been or may be affected by the change, condition, or event.
b.Labor or materials that will be added, deleted, or wasted by the change, condition, or event, and equipment that will be idled or added.
c.Existing or anticipated delays and disruptions in contract performance, procedure, or order.
d.Estimate of the time within which the Department must respond to the notice to reduce project cost, delay, or disruption.
4.Number of delay days illustrated in a schedule impact analysis showing the impact of the delay -causing event on the project activity sequences and durations.
5.All additional information contained within Article 1.12, 1.13, and 1.14 for which a RCO is being sought .
D.Maintain and deliver to the Department upon request , records for work performed which is believed to constitute changed or extra work .
E.Review and determine if the request is justified i f the RCO is based in whole or in part on a request by a Subcontractor .
1.12 Excusable Delay
A.Take all reasonable steps to minimize the impact of the delay once a delay -causing event is identified.
1.Failure to do so may result in the rejection of all or part of the delay RCO .
B.Contract time extensions for compensable and non- compensable delays will be determined based on a mutually agreed to schedule impact analysis showing lost time attributable to the delay -causing event
C.Documentation for compensable delays
1.Maintain daily records of labor, station locations, and equipment costs for operations affected.
a.Obtain the Engineer’s acceptance with these records on a daily basis.
2.Prepare and submit weekly written reports to the Engineer that contain:
a.Number of delay days
b.Summary of all delayed operations, and operations that will be delayed, and the cause for delay
c.Itemize all extra costs incurred. Include at least the following: 1) Document how the extra costs relate to the delay and how they are calculated and measured. 2) Identify all affected project employees for whom costs are being compiled. 3) Use actual internal cost records kept in the usual course of business to justify added costs. a) Comply with generally accepted accounting principles.
3.Meet with the Engineer weekly to compare the previous week’s daily records with those maintained by the Engineer.
a.Resolve any disagreement over weekly delay costs with the Engineer.
b.Provide written notice within ten calendar days documenting the disagreement between Department’s calculations of weekly delay costs.
c.Failure to provide notification is interpreted as acceptance that Department records are accurate.
D.Compensable Delay costs will be determined as follows:
1.Direct Costs – Actual certified costs of the workforce and equipment idled by the delayed activity.
2.Field Indirect Costs – Actual certified cost increases for job- site supervision and field office operating costs or other costs not directly associated with a particular work activity for the period of delay.
3.Home Office Overhead – The markup allowed on all change orders includes the cost of home office overheads associated with that change in the project scope of work.
a.Demonstrate the following to be entitled to alleged additional compensation for under -absorbed home office overhead costs: 1) Under absorption actually occurred, meaning there was less revenue overall in relationship to home office costs and that no replacement work was obtained. 2) The under absorption was a direct result of the project. 3) Specific replacement work could have been reasonably obtained were it not for the alleged delay.
b.Provide the following information supporting the RCO for additional costs: 1) The previous five years audited financial statements that include as a minimum the following information: a) Summaries of actual home office overhead costs. b) Total revenues generated annually sorted by each project worked on during the year. c) The amount of gain/loss earned for each active project during each year.
c.The amount will be calculated as shown below if additional payment for home office overheads is justified: 1) Unabsorbed home office overhead will not be reimbursed for the first ten calendar days of the delay - causing event. 2) Home office overhead costs will be calculated from the eleventh calendar day of the delay -causing event through the events end if the project is between 0 and 90 percent complete. 3) The following formula will be used to calculate home office overhead costs: E = D [0.03(A)/C] Where:
0.03 = Allowed markup for home office overheads
A = Original contract value C = Total contract duration in calendar days including approved time extensions D = The agreed upon number of calendar days the project is delayed due to the delay -causing event minus ten E = Total reimbursable amount for unabsorbed home office overhead 4) Home office overhead will be reimbursed if the delay occurs after the project is 90 percent complete.
d.The Department does not compensate for the following: 1) Profit. 2) Loss of profit. 3) Labor inefficiencies. 4) Consequential damages, including but not limited to, loss of bonding capacity, loss of bidding opportunities, and insolvency. 5) Any indirect costs or expenses. 6) Attorney’s fees, claims preparation expenses, or litigation costs.
4.The total reimbursable cost for a compensable delay is the sum of the daily agreed to costs for direct costs, field indirect costs, and unabsorbed home office overhead costs as computed according to this article for the duration of the delay.
a.No other costs will be reimbursed.
E.Unusually S evere Weather
1.A delay due to unusually severe weather may be considered a non- compensable delay when the Contractor provides documentation that the weather conditions:
a.Were unusually severe for the project site and the affected time period;
b.Could not reasonably have been anticipated; and
c.Had an adverse effect on the scheduled construction.
2.Demonstrate that the severity or the number of days of unusually severe weather at the project location warrants entitlement to a time extension.
a.Establish that weather was unusually severe by comparing weather data (such as precipitation, temperature, or snowfall) for the affected time period with historical weather data for the same time period. 1) Refer to the Daily Values at the Prism Climate Group website to download historical temperature and precipitation values for the project location. Refer to http://www.udot.utah.gov/go/standardsreferences
3.Use historical weather data from at least the previous 5 years and no more than 10 years to:
a.Demonstrate that the unusually severe weather experienced at the project site limited the ability to perform work.
b.Demonstrate that the work was on the project’s critical path and that the critical path was affected. 1) Non-critical path work will not be considered a non- compensable delay for unusually severe weather .
1.13 Differing Site Conditions
A.This Article defines cost associated with changes due to differing site conditions, unforeseen condition or events (such as force majeure and foreign or domestic tariffs) that may result in a request for additional compensation or time.
B.Immediately notify the Engineer verbally of all potential changes to the contract .
1.Leave the site undisturbed and suspend work unless directed otherwise when differing site conditions on the project are encountered.
C.Continue the work unaffected by the alleged differing site conditions, change, condition, or event, to the extent possible under the contract.
1.The Engineer will provide a written response within ten calendar days of receiving the RCO to do one of the following:
a.Confirm the change, condition, or event and, when necessary, direct how the work will proceed.
b.Deny the change, condition, or event, and direct how the work will proceed.
c.Advise that there is not enough information to decide whether to confirm or deny the change, condition, or event and indicate what additional information is necessary for further review and the date by when it must be received. 1) Any contract adjustments will exclude increased costs or time extensions resulting from failure to provide the requested information.
D.The Engineer uses contract unit prices if they are representative of the work to be performed.
1.Unit price work will be reimbursed at the rates established in the contract.
a.These rates include compensation for the actual work and associated field indirect costs, home office overheads, profit, and all other costs incidental to the work unless otherwise defined in the contract.
E.Negotiated prices for changes to the contract work will be based on the estimate to do the work as validated by the Engineer. Support the price with a detailed cost estimate that includes the following information:
1.Estimated labor hours based on agreed upon productivity rates.
a.Use the actual cost of wages and benefits for the labor rates applied to the estimated man hours.
b.Include accounting records verifying these costs or make them available upon request of the Engineer.
2.Estimated material quantities based on agreed upon quantities.
a.Use actual material costs as verified by supplier estimates or invoices.
b.Use agreed to production rates for material produced on site.
3.Estimated Equipment hours based on agreed upon productivity rates.
a.Use either of the following for determining equipment costs: 1) Rental rates obtained from the Rental Rate Blue Book for Construction Equipment ac cordi ng to this Section, article 1.16. 2) Actual cost of the equipment to the Contractor based on internal equipment billing rates or actual rental rates supported by rental agreements for equipment applied to the estimated equipment hours. a) Include accounting records substantiating these costs or make them available upon request of the Engineer.
4.A 15 percent markup will be paid on labor, material and equipment expenses.
a.This markup compensates the Contractor for other direct expenses including bonds, small tools, home office overheads, profits, and incidental costs associated with the revised work.
5.The following cumulative additional markups , per issue, will be allowed on work performed by subcontractors:
a.15 percent on first $75,000; then
b.10 percent on amounts exceeding $75,000 up to $250,000; then
c.7.5 percent on any amount in excess of $250,000.
6.No other expenses will be compensated unless approved by the Engineer.
F.The Department will adjust contract time for directed changes that extend the Critical Path, of the project.
1.14 New Work Or Change In Character of Work
A.It is the intent of this Article to only address contract revisions where changes in quantities and alterations in the work are necessary to complete the work and result in new work or a change in the character of the work .
B.The Department adjusts the contract, excluding loss of anticipated profits, if the alterations or changes in quantities result in a significant change in character of work under the contract.
1.Agree upon the basis for contract adjustment before beginning work .
a.The Engineer may order the work to proceed under the force account provisions if a basis for adjustment cannot be agreed upon.
2.Adjustments may increase or decrease the unit price of an item.
C.Loss of expected reimbursement, anticipated profits, or increased costs due to unbalanced allocation among the contract items will not be compensated.
D.Unit price work will be paid at the original contract price when the total quantity of a major contract item of work , as defined by Section 00570, is within 25 percent , either higher or lower, of the original bid quantity , and the alterations or changes in quantities do not represent a significant change in the character of work to be performed under the contract.
1.An adjustment for a decrease in quantity below 75 percent of the contract quantity is limited to the actual quantity of work performed.
a.Fixed costs in the original contract may be considered when establishing the adjustment.
b.An adjustment in compensation may be made to the contract at the request of either party.
2.A price adjustment for an increase in quantity applies only to that portion in excess of 125 percent of the original contract quantity.
a.Fixed costs in the original contract price are deemed recovered by payment made for 125 percent of the contract quantity and excluded from any adjustment to that portion in excess of 125 percent of the original contract quantity.
b.An adjustment in compensation may be made to the contract at the request of either party.
E.The Department will adjust contract time for directed changes that extend the critical path of the project.
1.15 Value Engineering Change Proposal
A.Cost savings resulting from a Value Engineering Change Proposal (VECP) offered by the Contractor and approved by the Department will be equally shared.
B.Complete the contract as bid if a VECP is rejected.
C.Include the following information and materials with each proposal:
1.A statement that the submission is a VECP.
2.A description of the existing work and the proposed changes for performing the work . Discuss the comparative advantages and disadvantages of each.
3.A complete set of plans and specifications showing proposed revisions to the original contract.
4.A detailed cost estimate for performing the work under the existing contract and under the VECP.
5.The time frame within which a Department decision is requested.
6.A statement of the probable effect the VECP will have on the contract completion time.
7.A description of any previous use or tests of the proposal, conditions, result, dates, project numbers, and the Department’s action on the VECP if previously submitted.
D.Provide additional information requested by the Department in a timely manner.
1.The Department notifi es the Contractor within seven calendar days when there is insufficient review time for a response.
2.The Department may consider a non- compensable delay adjustment to the contract based on the additional review time necessary and its effect on the schedule.
E.Requirements
1.VECPs apply only to the current contract and become property of the Department regardless of their approval.
2.The Department only considers VECPs that meet the following conditions:
a.Impose no restrictions on use or disclosure not protected by rights provided by law with respect to patented materials or processes such as 1) Preventing the Department from duplicat ing or disclos ing any data necessary to use the VECP. 2) Preventing the Department from the general use on other contracts .
3.The Department may reject a VECP that requires excessive review, evaluation or investigation, or that is inconsistent with project design policies or criteria, or at the discretion of the Engineer.
4.Subcontractors cannot submit VECPs.
F.An RCO for additional costs or delays including development costs, loss of anticipated profits, or increased material or labor costs will not be permitted if the VECP is rejected or if additional information was requested and not submitted.
G.The Department does not consider savings generated by contingency items when it is reduced as part of a VECP unless it can be tied to a reduction in contract time.
H.Withdrawal of all or part of any VECP is allowed any time before Approval by the Department.
I.The Department pays by change order for VECPs that produce a cost savings approved in whole or in part.
1.The change order incorporates changes in quantities of unit bid items or new agreed price items, as appropriate.
2.The Department pays for the revised work directly and pays 50 percent of the savings between cost of the revised work or substituted material and the original bid price.
3.The Department does not reimburse costs to develop, design, and implement the VECP.
1.16 Force Account
A.Work on a force account basis may be required if an agreed upon compensation cannot be negotiated for changed or added work or for the convenience of the Department.
1.Costs reimbursed according to this article are considered full and complete compensation for the work performed.
B.A 15 percent markup will be paid on all labor, material, equipment and direct costs, including bond.
1.This markup is compensation for all field indirect costs.
C.Labor will be reimbursed at the actual sum of unburdened wages plus 60 percent .
1.Provide daily field records showing the labor hours charged to the force account work .
a.Obtain signed concurrence from the Department’s field representative for these records daily.
2.Include accounting records verifying these costs or make them available to the Engineer upon request.
3.The Department may pay t he actual cost of wages plus burden if the C ontractor can demonstrate the actual cost .
D.Materials will be reimbu rsed at the actual cost of installed materials as verified invoices and accounting record.
1.Make records available to the Engineer upon request .
2.Provide daily field records showing the quantity of materials installed as part of the force account work .
a.Obtain signed concurrence from the Department’s field representative for these records daily.
E.Compensation for Equipment
1.The Department will pay for equipment, authorized by the engineer, by either of the following:
a.Actual cost of the equipment based on internal equipment billing rates or actual rental rates supported by rental agreements. 1) Provide accounting records substantiating these costs.
b.Hourly rates for the equipment, excluding small tools. 1) Hourly rental rates are determined by the monthly rental rate found in the Rental Rate Blue Book for Construction Equipment divided by 176. 2) The total hourly rates have been computed from equipment costs currently in effect and do not include costs for operating personnel. Obtain this publication through: Equipment Watch 1735 Technology Drive, Suite 410 San Jose, CA 95110- 1313 Phone: (800) 669- 3282 Fax: ( 800) 224- 3527 Refer to http://www.udot.utah.gov/go/standardsreferenc es. 3) The rates require adjustment by a Regional Factor and a Depreciation Factor with operating and standby rates established as follows: a) Operating Rate – Hours the equipment is actually in use. (1) This includes ownership and operating costs adjusted for depreciation and region factors. b) Standby Rate – Compensation for equipment required to be at the work site but not operating. (1) This rate is 50 percent of the adjusted ownership and operating costs computed above. (2) The duration of allowable standby time must be approved in writing by the Engineer with a maximum of eight hours per day or 40 hours in a week. 4) The Department uses the shown capacity that is closest to the manufacturers when the manufacturer’s rated capacity falls between those shown in the Rental Rate Blue Book for Construction Equipment . 5) Agree upon all rates in writing before beginning work . 6) Obtain approval from the Engineer for any equipment rental rates not provided before the start of any force account work . 7) The Department allows move- in and move- out transportation cost for a piece of equipment not available on the jobsite , if the particular piece of equipment is not moved onto the job under its own power. a) The Department allows hourly operating rate for equipment moved to the site under its own power. b) The Department pays these charges only once for any particular piece of equipment except in unusual circumstances that must be justified in writing and agreed to by the Engineer. 8) The equipment may be rented from a local source when the required equipment is specialized and not available in inventory or is in the available inventory but not on the project site. a) Submit the rental or lease agreement to the Engineer for approval where the rental rate charged exceeds the rate determined by the Rental Rate Blue Book for Construction Equipment . b) Move -in and move- out costs for equipment owned may be considered when comparing rental costs of equipment obtained from local sources when the equipment is to be used less than a week. c) This option is only allowed when the cost of locally rented equipment is less than using equipment owned , including move- in and move -out charges. d) Rentals must be supported by a cost analysis indicating the method used was the least expensive. e) The Department reimburses for such equipment based on the Rental Rate Blue Book for Construction Equipment if equipment rented is of a type that is owned and the rental costs exceed that allowed by this article.
2.Provide daily field records showing the equipment hours charged to the force account work .
a.Obtain signed concurrence from the Department’s field representative for these records daily.
3.Provide certified accounting records verifying these costs.
F.Subcontract work will be reimbursed in the same manner as described in this Article above.
1.The Department allow s the following cumulative markups , per issue, on force account work performed by subcontractors:
a.15 percent on first $75,000; then
b.10 percent on amounts exceeding $75,000 up to $250,000; then
c.7.5 percent on amount s in excess of $250,000.
2.Provide daily field records showing the subcontract labor, material, and equipment charged to the force account work .
a.The Engineer must review and accept these records daily.
3.Provide certified Accounting records verifying these costs
1.17 Claims Review Board
A.A Claim will be referred to the Claims Review Board (CRB) when requested, as provided in this article .
1.Submit a written request to the Engineer
B.The purpose of the CRB is to provide an independent and impartial review of submitted claims, written findings, and recommendations to the Department's Deputy Director.
1.The Claims Review Board is composed of:
a.The Project Development Director (chairman)
b.Director of Construction
c.A representative selected by the Utah Chapter of the Associated General Contractors (AGC)
C.Utilizing the CRB does not relieve the Contractor or Department of complying with all Contract terms and conditions, and does not waive any notice or timeliness requirements.
1.Proceed diligently with all work during the CRB process.
D.The Director of Construction or designee schedules a hearing before the CRB when deemed to be in the best interest of both the Contractor and the Department based on the request for a higher -level review .
1.The claim may be presented informally with or without legal counsel.
2.Notify the Department at least 1 4 calendar days before the meeting when using legal counsel.
3.The Department may have legal counsel present if the Contractor decides to use legal counsel .
4.Legal counsel will be allowed to attend the presentation, and will be allowed to make brief opening and closing remarks and advise their clients.
a.No other participation by legal counsel at the presentation will be permitted.
E.Parties will bear their own costs.
1.All costs associated with preparation and participation in the CRB meeting will be the responsibility of each party.
2.No compensation for travel, time, research activities, time away from the project, presentation preparation, presentation time, or any other activities associated with the preparation for or participation in the CRB process will be given to either party .
F.Pre-presentation Requirements
1.The Department and the Contractor will prepare concise written statements describing the claim and each party's position with reasoning and submit to the Department’s Director of Construction or designee , a minimum of 14 calendar days before the scheduled presentation, who will distribute them to the other party a minimum of 10 calendar days before the scheduled presentation.
2.The parties will submit their visual presentation to the Director of Construction or designee who will distribute it to the other party a minimum of 10 calendar days before the scheduled presentation, if either party chooses to prepare a visual presentation.
G.Presentation
1.The party that is in attendance will prevail in their position on the claim if either the Department or the Contractor fails to appear before the CRB on the date and time scheduled for the presentation without justifiable cause.
2.The Contractor will present their position first, followed by the Department.
3.The duration of each party's presentation will be determined when the Claim meeting is scheduled and will be agreed to by both parties.
a.The duration may vary depending on the complexity and size of the claim.
4.Only information or claims related to the original claim may be discussed in the hearing.
a.No new information may be submitted.
b.The CRB will inform the party that no additional information or claims are permitted if the Contractor or Department attempts to submit new information.
5.Recording the meeting by any means is prohibited.
6.This presentation is informal, allowing for the Contractor and Department to present their positions, and for all parties to exchange questions and answers.
7.The meeting will be conducted as follows:
a.The chairman or designee informs the meeting attendees of the procedures and format of the meeting.
b.Both parties may deliver brief opening and closing remarks.
c.The Contractor presents their claim in detail as supported by previously submitted information and documentation. 1) The presentation can be verbal or visual.
d.The Department presents its detailed position as supported by previously submitted information and documentation. 1) The presentation can be verbal or visual.
8.No rebuttals will be allowed during the other party’s presentation, nor will they be allowed after the conclusion of the meeting.
H.Offer of Settlement or Rejection of Claim
1.The Department Deputy Director makes an offer of settlement within 45 calendar days of the claim hearing if the offer is less than the amount required to be reviewed by the Transportation Commission.
2.The decision of the Department Deputy Dir ector is administratively final.
a.The CRB hearing ends all administrative appeal processes available.
b.The Contractor may elect to file a complaint in State court if the claim is rejected, or if the sum tendered by way of settlement is not acceptable to the C ontractor .
I.Acceptance or Rejection
1.Provide written notice to the Department Deputy Director of acceptance or rejection of the offer or rejection of the claim within 14 calendar days of the date of the Department Deputy Director's offer.
a.The Department will promptly process any required payments or contract changes if both the Department and Contractor agree to resolve the Claim.
1.18 Claims Record Keeping
A.Maintain complete records electronically of all costs and additional time incurred for any alleged claim.
1.Permit the Engineer access to those records and any other records as required to determine the facts or contentions involved in the claim.
2.Retain all records for a period of not less than three years after final payment.
1.19 Claims Auditing
A.All claims filed against the Department are subject to audit at any time following filing the claim.
B.The Department or an auditor under contract with the Department may conduct the audit.
1.The audit may begin at any time during the life of the contract or 20 calendar days after notice is provided if more than 60 calendar days after the project acceptance date of the contract have elapsed.
C.Provide adequate facilities acceptable to the Engineer for the audit during normal business hours.
1.Cooperate with the auditors.
D.Failure to maintain and retain sufficient records to allow the auditors to verify all or a portion of the claim or to permit the auditor access to the books and records constitutes a waiver of the claim and bars any recovery.
E.Make the following documents available to auditors at a minimum:
1.Daily time sheets and supervisor's daily reports.
2.Union agreements, if any.
3.Insurance, welfare, and benefits records.
4.Payroll registers.
5.Earnings records.
6.Payroll tax forms.
7.Material invoices, purchase orders, requisitions, and all material and supply acquisition contracts.
8.Material cost distribution work sheet.
9.Equipment records including internal rates charged to the project.
10.Vendor rental agreements and subcontractor invoices.
11.Subcontractor payment certificates.
12.Canceled checks (payroll and vendors).
13.Job cost report.
14.Job payroll ledger.
15.General ledger, general journal if used, and all subsidiary ledgers and journals together with all supporting documentation pertaining to entries made in these ledgers and journals.
16.Cash disbursements journal.
17.Depreciation records on all company equipment used in performance of the work .
18.All other documents used to develop costs for internal purposes to establish the actual cost of owning and operating equipment used in performance of the work .
19.All documents related to preparing bid, including final documents on which the bid was based - Exclude documents placed in escrow.
20.All documents that relate to each and every claim together with all documents that support the amount of damages as to each claim.
21.Work sheets used to prepare the claim establishing the cost components for items of the claim including, but not limited to, labor, benefits and insurance, materials, equipment, subcontractors, all documents that establish the time periods, individuals involved , and the hours and rates for the individuals.
22.Any other documents that the Department deems necessary to assess the validity of a claim.
F.Full compliance with the provisions of this article is a contractual condition precedent to the right to seek judicial relief.
Part 2 — PRODUCTS Not Used
Part 3 — EXECUTION Not Used
Source: Utah Standard Specifications for Road and Bridge Construction, 2026 Edition. Pages 90–113 of 1,331.