Change Order Preparation

Prepare COs using the guidelines in this chapter when contract revisions, additions, or deletions to the work are necessary. Prior to developing a CO, work with the contractor to define the scope of the problem that requires a change to the contract. Evaluate possible solutions with the contractor. Determine the method of work, need for additional time, need for additional resources, impact to traffic, and cost
.
Request in writing a cost breakdown from the contractor for labor, equipment, subcontractors, materials, and additional costs
.
Prepare a price justification for all added items to determine if the contractor’s submitted prices are fair and reasonable. Compare contractors’ prices to the Statewide or Districtwide average low bid unit prices, a comparative cost analysis using similar work or small quantity to justify the cost. Do not approve COs based solely on the contractor’s submitted request and documentation. Negotiate with contractors for prices that are not substantially supported by the price justification. Once prices have been approved by the district, initial all price justification documents received from the contractor to ensure they have been reviewed and include with the CO supporting documentation
Obtain assistance from the Construction Division (CST), DES, or the District Construction Office (DCO), as needed. Obtain contractor’s agreement regarding the scope of work and basis of payment for the CO. Provide the contractor the CO to sign
.
Do not use the written statement in the contractor’s signature block on the CO form to deny the contractor legitimate additional compensation for work beyond the scope of the CO or for work under the CO that was not approved or predictable at the time of CO execution
.
The DCO assists the AO with the CO description and reason coding, if necessary, and coordinates with the District or Construction Division (CST) FHWA Liaison to confirm federal participation. The AE and /or DCO also coordinates with the District Transportation Planning and Development (TP&D) Financial Manager to procure funding for CO's. Ensure that all COs are signed and sealed
based on the Delegation of Signature Authority
.
Show all information and quantities about the proposed change on the CO. A performance bond is required if the CO increases the contract cost above the $100,000 threshold.
Construction Division form
Form 2146
, “Change Order Checklist,” is to be completed and included with all COs. The following steps should be completed when preparing a CO:
  1. Include the following information in the CO description: What is the CO for, Why is the CO needed, Where is the CO work being performed, and How will the CO work be accomplished
    .
  2. Funding – Coordinate with DCO to determine funding category. If the CO involves third party funding, complete the funding notification sheet (
    Form 2146-AFA
    , “Advanced Funding Agreement”). Provide notice to the local government or other third party. Ensure that an authorized third-party representative signs the Form 2146-AFA, regardless of the CO amount. See “Advanced Funding Agreements”, under “Other Factors Affecting CO’s” for additional requirements. The contractor is not responsible for any delays the district may have in the obtaining a third party’s signature. The dollar amount to be placed for the Advance Funding Notification or Donation Agreement (third party funding) on the CO should be the same as the dollar amount on line 3(a) on the Form 2146-AFA, which should be only the amount of contract items corresponding to the third party without the CO & Contingency and Indirect Costs
    .
  3. Participation – Before adding items in SiteManager, coordinate with DCO to determine participation. Participating and non-participating pay items must be on separate CO’s
    .
  4. Determine appropriate function (zero dollar, overrun, time extensions, etc.)
  5. Determine appropriate CO reason code(s) using
    Form 2146-RC
    . Reason codes may be associated with federally non-participating CO depending on the circumstances for the CO
    .
  6. Are there any added or modified plan sheets (include in the description if the plans are TxDOT or Consultant Design)
    .
  7. Has environmental clearance been addressed? Include a statement in the CO description.
  8. Are the costs reviewed, verified and are they considered fair and reasonable? Include a fair and reasonable statement in the CO description.
  9. When adding new pay items, check the
    bid code list
    for existing items available in SiteManager. Only use Unique CO item (UCOI) when an appropriate item code is not available
    .
  10. For all items being added or modified, include CO# in the item’s description tab. Under the New Contract Item tab, add a supplemental description in the following format, “Added by CO#X”. When using a UCOI include the CO#, short description of the item and the Unit of Measure (UOM) (if not paying by the dollar) in the supplemental description tab.
  11. Copy the supplemental description, navigate to the CO Item tab, and paste the supplemental description into the CO Item Description field
    .
  12. CO signatures can be either written or electronic. Signatures must follow District, Construction Division and Executive Director “Delegation of Authority” memos, found on
    Contract Services Division
    webpage (internal access only)
    .
  13. Are there any TDLR requirements?
  14. Determine if the CO requires Form 1295. See “Texas Ethics Commission Form 1295”, under “Other Factors Affecting CO’s”, for additional requirements
    .
  15. Determine whether or not time adjustments are required. If so, provide a description, including a breakdown of the days added
    .