A. The city, without invalidating the contract, may order changes in the work within the general scope of the contract consisting of additions, deletions, or other revisions; the contract sum and the contract time being adjusted accordingly. All such changes in the work shall be authorized by change order, and shall be performed under the applicable conditions of the contract documents. The change order will be initialed by the project architect/engineer with his or her recommendation and forwarded to the city for approval or rejection.
B. The contractor shall bear any additional fees and costs incurred by the owner, architect, engineer, or consultant for fees as a result of a change order which adjusts the contract time and which is not because of any act or omission of the owner, architect, engineer or consultant.
C. The cost or credit to the owner resulting from a change in the work shall be determined in one or more of the following ways:
1. By unit price stated in the original contract documents.
2. By cost, as deemed below, properly itemized and supported by sufficient substantiating data to permit evaluation, plus a fee of 10% designed to compensate the contractor for overhead and administrative costs. Specific costs shall be itemized by crafts defined within the schedule of values and limited to the following items directly allocable to the change in work:
a. Cost of materials, including cost of delivery;
b. Cost of labor, including, but not limited to, social security, and unemployment insurance and fringe benefits required by agreement and workers' compensation insurance;
c. Rental value of equipment and machinery;
d. Sales tax, insurance and bond premiums; and
e. Amounts for any additional supervision and field office personnel, which shall not exceed 5% of the total of the above divisions C.2.a. through C.2.d.
3. By mutual acceptance of a lump sum amount representing properly itemized services and supported by sufficient substantiating data to permit evaluation; provided that the lump sum shall not exceed that amount calculated under division C.2. above.
D. All change orders within amounts appropriated in the current fiscal year budget for the subject of the bid award will be authorized and executed in the following manner:
1. Authority to approve change orders is subject to the following cumulative per project limits:
$5,000 or less | Project Manager |
$5,000 up to $10,000 | Department Director |
$10,000 to $30,000 | City Manager |
$30,000 and above | City Council |
2. For example, if the Project Manager is asked to approve $1,000 change orders, he or she can only do so up to five times. If the five change orders are $3,000 each, the department director must approve the second and third change order and the City Manager must approve the fourth change order, as the cumulative amount exceeds $10,000. In addition, the City Manager must then approve all subsequent change orders within the approved contract. A change order tabulation sheet must be submitted showing all change orders incurred for a project along with each request for approval of a change order.
E. If any change order causes the total expenditures on a project to exceed the amount of the contract for that project approved by the City Council, then the City Council must approve that change order. The City Council must approve any single change order exceeding $30,000.
F. For equipment, goods, and services, all change orders within amounts appropriated in the current fiscal year budget for the subject of the bid award will be authorized and executed in the following manner. If the change order is for less than $10,000, the department director will have authority for approval or rejection. If the change order is between $10,000 and $30,000, the City Manager's approval is needed. If the change order exceeds $30,000, the City Council will have the final authority to sign the change order. If any change order exceeds the current fiscal year budget for the subject project, the City Council must approve it. The City Council reserves the right to adjust these authorized approval amounts for each individual project.
(Res. 2008-011, passed 2-19-2008)