HomeMy WebLinkAbout030594 RES - 08/25/2015 Resolution establishing City Council policy for construction
change orders.
WHEREAS, approximately 95% of the City's construction contracts are procured
using the design-bid-build method of procurement;
WHEREAS, 100% of these design-bid-build contracts are bid as unit price
contracts, lump sum contracts, or contracts that are priced using a combination of units
and lump sum items of work;
WHEREAS, the City does not enter into guaranteed maximum price contracts or
cost plus contracts for traditional design-bid-build contracts;
WHEREAS, unit pricing, whereby the contractor sets a price for each unit of work
or category of cost is a typical way for pricing public works such as roadways and
runways;
WHEREAS, unit pricing is most often used on public infrastructure projects;
WHEREAS, Texas Local Government Code (LGC) section 252.048 provides
authority for the governing body to approve change orders due to changes in plans or
specifications, decrease or increase in the quantity of work, materials, equipment or
supplies due to unforeseen conditions;
WHEREAS, TX LGC sec. 252.048 also provides that the total contract price may
not be increased unless additional money is appropriated and the original contract price
may not be increased by more than 25%;
WHEREAS, where an additional scope of work needs to be added to a
construction contract and the project indicates a change order, if the total amount of that
change order, when added to all previously executed change orders, would increase the
original contract price by more than 25%, that change order is not executed, and the
additional scope of work is not made a part of the original contract;
WHEREAS, the construction services required for performing the additional
scope of work must instead be procured by a manner authorized by state law;
WHEREAS, TX LGC sec. 252.048(c-1) authorizes the governing body in a
municipality with a population of 300,000 or more to grant general authority to an
administrative official to approve public works change orders that involve an increase or
decrease of$100,000 or less;
WHEREAS, the City of Corpus Christi (City) Code of Ordinances, Part II, Council
Policy No. 18, provides that the City Council (Council) grants to the City Manager or his
designee the authority to approve change orders up to the maximum amount permitted
under Texas law;
030594
INDEXED
WHEREAS, the General Conditions of the City's construction contract requires
the City to execute change orders for agreed upon changes in contract price, contract
times and changes in the work;
WHEREAS, Council recognizes that change orders are a normal and necessary
part of any construction project;
WHEREAS, change orders amend the contract by revising either the contract
price or contract times due to, for example, design changes, design deficiencies,
misinterpreted or vague or ambiguous specifications upon which the contractor relied in
making their bid, drawing errors and omissions, unforeseen conditions, differing site
conditions, substitutions, or Owner/City-requested changes to add or delete from the
originally contracted scope of work;
WHEREAS, when these events occur and the contract must be amended,
timeliness and proper change management is critical in seeking to minimize costs, and
to avoid costly delays, claims, and litigation;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF CORPUS CHRISTI, TEXAS THAT THE FOLLOWING POLICY BE ADOPTED:
SECTION 1. When a construction contract is awarded, an amount for change orders
shall be designated, the typical allocation being ten percent of the contract price
("Contingency").
SECTION 2. The City Manager is authorized to approve change orders within the
parameters allowed by state law. Change orders exceeding the threshold amount
authorized by state law for administrative approval must be approved by City Council.
SECTION 3. The City Manager is authorized to further delegate his authority to
approve change orders.
SECTION 4. The City Manager shall provide a quarterly report to the City Council of all
change orders approved under his authority.
SECTION 5. If the aggregate sum of change orders exceeds 75% of the set aside
Contingency, the City Manager shall notify the City Council immediately upon execution
of the change order.
PASSED AND APPROVED this 25 day of �/ -t w , 2015, at a Regular
Meeting of the City Council of the City of Corpus Christi,txas by the following vote:
ATTEST:
Rebecca Huerta Nelda Martinez
City Secretary Mayor
Corpus Christi, Texas
(,th Oral— , 2015
Nelda Martinez
Rudy Garza
Chad Magill
Colleen McIntyre
Lillian Riojas
Brian Rosas
Lucy RubioI_Ai
Mark Scott
I
Carolyn Vaughn /��•�' `
03059/7