Brown Book
Transcript of Brown Book
-
Contract/SubcontractManagement User Guide
Copyright 1999. All Rights Reserved.
-
TABLE OF CONTENTS Page i of v
1 INTRODUCTION
Purpose
Scope
Related Manuals
2 RESPONSIBILITIES
Assignment of Tasks
3 INITIAL TASKS
Pre-Award Activities
Pre-Construction Meeting
Filing System
Correspondence and Correspondence Control
Insurance and Bonds
Schedule Submittals
4 PERFORMANCE
Changes
Commitment Approvals
Schedule
Requests for Information (RFI'S)
Technical Transmittals
Claims
Backcharges
5 MONITORING/REPORTING
Daily Report
Progress Review and Coordination Meetings
Progress Measurement and Payment
Quality Surveillance
Safety and Health
Environmental
6 CLOSEOUT
TOC TABLE OF CONTENTS *
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
TABLE OF CONTENTS Page ii of v
6.1 Contract Closeout
6.2 Beneficial Occupancy
6.3 Substantial Completion
6.4 Punch List
6.5 Warranty
7 SPECIAL TOPICS
7.1 Contract Law
7.2 Basis for Claims
7.3 Negotiation
7.4 Interface Coordination
7.5 Labor and Industrial Relations
7.6 Force Accounts
7.7 Liquidated Damages
7.8 Delays and Extension of Time
7.9 Acceleration
7.10 Suspension of Work
7.11 Differing Site Conditions
7.12 Terminations
7.13 Project Environmental Controls
INDEX
FORMS
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
TABLE OF CONTENTSSECTION 1. INTRODUCTION Page i
Introduction
TABLE OF CONTENTS
1.1Purpose......................................................................................................................................11.2Scope.........................................................................................................................................1
-
SECTION 1. INTRODUCTION Page 1 of 1
1.1 Purpose This Guide establishes standard practices for managing subcontracts.
1.2 Scope This Guide provides procedures for managing subcontracts.
Many of the procedures in this Guide include a work practice Checklist toprovide a quick overview of the key requirements of contract management.
A clear understanding of the terms and conditions of the contract beingmanaged as well as those of the prime contract is required before any actionprescribed by these procedures is taken.
This Guide should be used in conjunction with approved Project proceduresmanuals.
1 INTRODUCTION
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
TABLE OF CONTENTSSECTION 2. RESPONSIBILITIES Page i
Responsibilities
TABLE OF CONTENTS
2.1 ASSIGNMENT OF TASKS.......................................................................................................12.1.1Purpose..................................................................................................................................12.1.2Background............................................................................................................................12.1.3Procedure...............................................................................................................................12.1.4Exhibit...................................................................................................................................1
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 1 of 11
2.1ASSIGNMENT OF TASKS
2.1.1Purpose The purpose of this section is to provide a comprehensive list of tasks whichshould be performed to manage a contract successfully.
2.1.2Background Effective management of a contract includes making sure that each of theessential task is assigned and performed. The complexity and size of theindividual contract and available project resources will affect the decision ofwhich tasks are essential for the contract. However, certain tasks should beconsidered essential for all contracts (e.g., daily reports, change controlprocedures, correspondence log and files, insurance and safety/healthrequirements.
Contract management is a team effort. Optimizing a projects personnelresources requires that administrative responsibilities be delegated through theproject organization, independent of a groups discipline responsibilities.
2.1.3Procedure The method of communicating and assigning the functional responsibilities foreach contract is by a Division Of Responsibility (DOR) Matrix (Exhibit2.1.3.).
The generic DOR Matrix in this procedure is a guideline for development of aproject or contract-unique DOR to ensure that each of the identified tasks isassigned to specific project personnel. A small project may have one DORfor the entire job or a large project may have separate DORs for eachcontract.
2.1.4 Exhibit Division of Responsibility (DOR) Matrix (Exhibit 2.1.3)
2 RESPONSIBILTIES
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 2 of 11
Contract No.
Contractor
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
ContractFormation -Regional OfficeIssued Contracts
Lead__________
Input to MaterialAssignmentSchedule
Assigned to:__________
Development ofproformadocument anddetermination ofmandatory primecontractflowdowns
Assigned to:__________
Coordinatepackagedevelopment,pre-bid meetingandbidding/award ofcontract
Assigned to:__________
Input to pricingand proposalsection
Assigned to:__________
Prepare MaterialRequisition (MR),technical scope,specifications anddrawings
Assigned to:__________
Identify companyor customerfurnished utilities,facilities andservices
Assigned to:__________
Develop andprovide schedulerequirements andcost estimates forcontract package
Assigned to:__________
Review bids,provide input tobid evaluationcriteria, bidevaluation andbid clarificationmeeting
Assigned to:__________
Pre-bid Meeting
Lead__________
Develop agenda;biddingprocedure;commercialaspects; preparemeeting minutes
Assigned to:__________
Chair andconduct meeting;cover projectscope, workrules, generalconditions; ethicsand code ofconduct
Assigned to:__________
Review changemanagement,insurance,progressreporting andpaymentdocumentation
Assigned to:__________
Review qualitycontrol, fieldengineeringrequirements
Assigned to:__________
Cover siteoperationalrequirements, laborrelations, contractorinterface andcoordination
Assigned to:__________
Describe cost andschedule reportingrequirements
Assigned to:__________
Explain Safetyand Health Plan,and projectrequirements
Assigned to:__________
VFor contracts which the company is managing on behalf of a customer, the DOR should be modified to include customer representative interfaces.
Notes: 1. The Project Manager or Site Manager, in conjunction with the Contracts Manager, is responsible for assignment of the functions listed in this matrix. All tasks must be assigned and the
responsible employee trained and familiar with the task.
2. If the nature of the contract or available project resources dictate that a task will not be assigned and performed, indicate "Not Performed" in the "Assigned To" box. 3. All employees are responsible for providing the necessary support to an employee assigned responsibility for a given task or function.
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 3 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
Division ofResponsibilityMatrix (DOR)
Lead__________
Initialassignments(by name)
Assigned to:__________
Updates
Assigned to:__________
Historical file
Assigned to:__________
ContractPackageTurnover fromRegional Office to Field
Lead:__________
Review turnoverpackage forcompleteness
Assigned to:__________
Composepunchlist ofmissing items inturnover package
Assigned to:__________
Monitor andstatus punchlist
Assigned to:__________
Establishresponsibilityfor resolution ofopen items
Assigned to:__________
Pre-constructionMeeting
Lead__________
Define CompanyAuthorizedRepresentative
Assigned to:__________
Prepare agenda,conduct meeting
Assigned to:__________
Discussconstructionoperationsrequirementssuch as facilities,equipment,coordination
Assigned to:__________
Cover LaborRelationsrequirements
Assigned to:__________
Cover Safety andHealthrequirements
Assigned to:__________
Cover scheduleand progressreportingrequirements
Assigned to:__________
Cover contractadministrativerequirementsincludingsubmittals andinvoicing
Assigned to:__________
Review ethicsand code ofconduct
Assigned to:__________
Pre-constructionMeeting(continued)
Lead________
Prepare meetingminutes andaction/open itemslist
Assigned to:__________
Monitor andstatusaction/openitems
Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 4 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
Labor Relations
Lead _______________
AdministerProject LaborAgreement, ifapplicable
Assigned to:
Labor Relations Dept.
Coordinate laborissues withcontractor
Assigned to:__________
Receivecontractor'snotices ofactual/potentiallabor disputes
Assigned to:__________
Record nature,duration andimpact of workstoppages
Assigned to:__________
Correspondenceand Notices
Lead__________
Designaterecipient for allcontractcorrespondence(except as notedbelow)
Assigned to:__________
Logcorrespondenceand maintain files
Assigned to:__________
Assign actions
Assigned to:__ALL_____
Report andfollow up openaction items
Assigned to:__________
Prepare outgoingcorrespondence,log and monitoropen items
Assigned to:__________
Review outgoingcorrespondencefor compliancewith contract andprocedures
Assigned to:__________
Review and signall outgoingcorrespondence
Assigned to:__________
Archiving andpermanentstorage
Assigned to:__________
Requests forInformation(RFI's)
Lead__________
Designaterecipient
Assigned to:__________
Log RFI's,maintain Files
Assigned to:__________
Assign action
Assigned to:__________
Report andfollow-up openaction items
Assigned to:__________
Review and signoutgoing responses
Assigned to:__________
Review RFI's "afterthe fact" forcommercialimpact
Assigned to:__________
File/RouteMiscellaneousDocuments
Lead__________
Contract files
Assigned to:__________
Drawings
Assigned to:__________
Technicaldocuments(other thandrawings)Assigned to:__________
Schedulesubmittals
Assigned to:__________
Payment files
Assigned to:__________
Expediting reports
Assigned to:__________
Inspection reports
Assigned to:__________
Progressphotos
Assigned to:__________
File/RouteMiscellaneousDocuments(Cont'd)
Safety / Securityfiles
Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 5 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
Insurance andBonds
Lead__________
Obtain and re-view InsuranceCertificates andbond commit-ment letters forcontractcompliance
Assigned to:__________
Verify validity ofInsuranceCertificates andletters
Assigned to:__________
Verify insuranceand bondingcompanies areon company'sapproved list
Assigned to:__________
Maintain ticklersystem forpolicyexpirations
Assigned to:__________
ContractorTechnicalSubmittals
Lead__________
Develop list ofcontractorsubmittals
Assigned to:__________
Receive and logcontractorsubmittals
Assigned to:__________
Assign actionitems andmonitor statusof open items
Assigned to:__________
Conduct orcoordinatetechnicalreviews
Assigned to:__________
Conduct orcoordinate cost andschedule reviews oftechnical submittals
Assigned to:__________
Approvecontractorsubmittals
Assigned to:__________
Monitor closureof contractorsubmittalrequirements
Assigned to:__________
ContractSchedule
Lead:__________
Set Milestonedates
Assigned to:__________
Obtain initialcontractorschedule
Assigned to:__________
Verify schedulesubmittal meetscontractrequirements
Assigned to:__________
Coordinate sub-mitted schedulewith projectschedule
Assigned to:__________
Approve schedulesubmittal
Assigned to:__________
Monitor progressagainst approvedcontract schedule
Assigned to:__________
Obtain/reviewperiodic scheduleupdates fromcontractor
Assigned to:__________
Review claimedimpactsaffecting criticalpath/milestones
Assigned to:__________
ContractSchedule(Cont'd)
Processcompany or 3rdPartybackchargesarising from latescheduleperformance
Assigned to:__________
Evaluate whethercontractmilestone datechanges arejustified
Assigned to:__________
Issue ChangeOrder to confirmjustified andagreed uponchangesto contractschedule
Assigned to:__________
Issue notices ifcontractmilestone datesare in jeopardy
Assigned to:__________
Direct accelerationto recover schedule
Assigned to:__________
Directacceleration toadvancemilestone datesrelative to contractdates
Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 6 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
ProgressPaymentSchedules
Lead__________
Obtain, review forcompliance withcontract
Assigned to:__________
Establish methodand verifyquantity or workmeasurementmethods
Assigned to:__________
Review,compare tocontractschedule anddevelop cashflow curve
Assigned to:__________
Approvequantityprogresscalculations
Assigned to:__________
Invoices andPayments
Lead__________
Check invoicesfor accuracy andthat pricing isaccording tocontract
Assigned to:__________
Verify billed workagrees withapprovedprogress
Assigned to:__________
Verify contractrequirements aremet beforepayments issued
Assigned to:__________
Verify properdeductionsmade forretention,backcharges orother offsets
Assigned to:__________
Approve payments
Assigned to:__________
TechnicalTransmittalsfrom Engineer
Lead__________
Receive copies oftransmittals,prepare ChangeNotices
Assigned to:__________
Sign ChangeNotices
Assigned to:__________
Assemble andpreparetransmittals tocontractor
Assigned to:__________
ContractChanges
Lead__________
Initiate requestsfor changes
Assigned to:__________
Review requestsfor changes
Assigned to:__________
Prepare ChangeNotices, ChangeOrders andAmendments
Assigned to:__________
Sign ChangeNotices
Assigned to:__________
Issue, control andmonitor ChangeNotices
Assigned to:__________
Track costs for allchanges pendingnegotiated settle-ments
Assigned to:__________
Negotiatechanges
Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 7 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
ContractorProposals
Lead__________
Receive and logcontractorproposals
Assigned to:__________
Evaluatetechnical merit
Assigned to:__________
Evaluateschedule merit
Assigned to:__________
Evaluatecommercialmerit
Assigned to:__________
Prepare responsesto contractor
Assigned to:__________
Authorizenegotiation limits
Assigned to:__________
Plan and conductnegotiations
Assigned to:__________
Approve finalsettlements
Assigned to:__________
ContractorProposals(continued)
Prepare cost andcommitmentchanges andobtain approvals
Assigned to:__________
Daily Reports
Lead__________
Observe,assemble andreport significantinformation(Prepare DailyReports)
Assigned to:__________
Review DailyReports forcommercialsignificance
Assigned to:__________
Review DailyReports forProjectsignificance
Assigned to:__________
Log and retainDaily Reports
Assigned to:__________
Contractor'sForce, EquipmentUtilization andMaterial UsageReports
Lead__________
Obtain reports
Assigned to:__________
Review andanalyze reports
Assigned to:__________
Log and retainreports
Assigned to:__________
ContractorQuality Program
Lead:__________
Obtain copy ofprogram
Assigned to:__________
Analyze, reviewand approve
Assigned to:__________
Resolve openaction items
Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 8 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
QualitySurveillance
Lead__________
Inspect work inprogress andcoordinate withcontractor
Assigned to:__________
Inspect off-site/shopfabrications
Assigned to:__________
Verify inspec-tions complywith contractrequirements
Assigned to:__________
Determineacceptance orrejection of work
Assigned to:__________
Review contractor'sproposedremedial actions
Assigned to:__________
Determine bestremedialaction and directcontractor
Assigned to:__________
Monitor close-outof open qualityissues
Assigned to:__________
Daily Report ofForce Account
Lead__________
Obtain reportsfrom contractor
Assigned to:__________
Summarize dataand report
Assigned to:__________
Approve reports
Assigned to:__________
Retain originalswith contractorinvoices
Assigned to:__________
Backcharges
Lead__________
Identify scope ofbackcharge work;prepare summary
Assigned to:__________
Determine ifwork isbackchargeable
Assigned to:__________
Prepare noticesof backcharge
Assigned to:__________
Obtaincontractorapprovals
Assigned to:__________
Establish uniquecost code forbackcharge workand verify work isproperly coded
Assigned to:__________
Summarize dailydata and reports
Assigned to:__________
Approvebackchargesettlements
Assigned to:__________
Safety and Health
Lead__________
Obtain copy ofContractor'sSafety andHealth Program
Assigned to:__________
Monitorcontractor comp-liance with Safetyand HealthProgram
Assigned to:__________
Obtain name ofdesignatedcontractoremployee forsafety & health
Assigned to:__________
Identify andevaluateviolations
Assigned to:__________
Prepare notices tocontractor
Assigned to:__________
Sign/approveviolation notices
Assigned to:__________
Transmit notices,maintain log andmonitor status ofviolation notices
Assigned to:__________
Verifycontractorcorrectiveactions
Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 9 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
Environmental
Lead:__________
Identify projectagencies.environmentalregulations andconstraints
Assigned to:__________
Obtain copy ofcontractor'swrittenEnvironmentalComplianceProgram (ECP),if required andobtain name ofdesignatedcontractoremployee forECP
Assigned to:__________
Prepare apermitting planor matrix
Assigned to:_________
Reviewcontractorpermitrequirementsand monitorcompliance
Assigned to:__________
Identifyenvironmentaldesign criteria andincorporate intodesign basis
Assigned to:__________
Facilitate thepreparation andreview process ofthe EnvironmentalImpactAssessment, ifrequired
Assigned to:__________
Monitor theprogress ofpermit acquisition
Assigned to:_________
Prepare aConstructionEnvironmentalControl Plan(CECP)
Assigned to:__________
Environmental(continued)
Obtain HazardousMaterials andWaste List fromcontractor and, asappropriate,Material SafetyData Sheets(MSDS)
Reviewcontractorproposed use ofhazardous mater-ials and monitorhazardousmaterials andwaste storageand removal
Determinewhethercontractor needsasbestosinspection ifwork includesdemolition orrenovation
Monitor writtennotice to EPA orstatedesignatedagency 10 daysprior todemolition orrenovation asrequired
Develop andimplement anenvironmentaltraining plan
MonthlyProgressReports
Lead__________
Provide data orother information
Assigned to:__________
Summarize andassemble dataand information
Assigned to:__________
Approve andissue monthlyreport
Assigned to:__________
Assigned to:__________Assigned to:__________Assigned to:__________Assigned to:__________Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 10 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
ContractProgressReview/CoordinationMeetings
Lead__________
Chair meetings
Assigned to:__________
Prepare agenda,meeting minutesand monitoraction items
Assigned to:__________
Obtain periodicupdates ofcontractor'sworkingschedules
Assigned to:__________
Review mostrecent as-builtschedule data
Assigned to:__________
Evaluate near term(3 week/4 week)look aheadschedules
Assigned to:__________
Coordinatecontractor's planwith othercontractors' plansand Company'sPlan
Assigned to:__________
Resolve scheduleconflicts
Assigned to:__________
Approve update-ed contractorworkingschedules andany changes toworkingschedules
Assigned to:__________
CoordinationMeetings forContractors
Lead__________
Chair meetings
Assigned to:__________
Prepare agenda,meeting minutes,and monitoraction items
Assigned to:__________
Resolvecoordinationconflicts
Assigned to:__________
LiquidatedDamages
Lead__________
Identify triggeringrequirements(e.g. submittals,milestones, etc.)
Assigned to:__________
Monitorperformance
Assigned to:__________
Collect/deductliquidateddamages
Assigned to:__________
Claims orDisputes
Lead__________
Monitor andmitigate potentialclaim situations
Assigned to:__________
Receive and logcontractor claims
Assigned to:__________
Monitor labor,equipment andmaterial usageon a daily basis.
Assigned to:__________
Conduct factfinding
Assigned to:__________
Evaluate technicalmerit
Assigned to:__________
Evaluate schedulemerit
Assigned to:__________
Evaluatecommercial merit
Assigned to:__________
Prepareresponse tocontractor
Assigned to:__________
Claims orDisputes(continued)
Authorizenegotiation andset limits
Assigned to:__________
Plan and conductnegotiation
Assigned to:__________
Prepare costand commitmentchanges andobtain approvals
Assigned to:__________
Approve finalsettlement
Assigned to:__________
Prepare ContractChange Order orAmendment (ifrequired)
Assigned to:__________
Issue ContractChange Order orAmendment andobtain signatures
Assigned to:__________
-
2.1 ASSIGNMENT OF TASKSSECTION 2. RESPONSIBILITIES Page 11 of 11
DIVISION OF RESPONSIBILITY MATRIXV (Exhibit 2.1.3)
Final Inspectionand Acceptance
Lead__________
Prepare finalacceptancepackage
Assigned to:_________
Assemble, statuspunch list
Assigned to:__________
Coordinate andperform finalwalk down,recommend finalacceptance
Assigned to:__________
PrepareContractCloseoutChecklist
Assigned to:__________
Coordinatecompletion ofContract CloseoutChecklist
Assigned to:__________
Release of Lienand FinalPayment
Lead__________
Obtaincontractor'scertificate that allsubcontractorsand suppliershave been paidAssigned to:__________
Issue final checkto contractor
Assigned to:__________
Warranty Claims
Lead__________
Prepare warrantyclaim
Assigned to:__________
Notify contractor
Assigned to:__________
Monitor timelyresponse
Assigned to:__________
Evaluateproposedremedial actionand direct bestsolutionAssigned to:__________
Monitor completionof remedial action
Assigned to:__________
Inspect/acceptremedial action
Assigned to:__________
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
TABLE OF CONTENTSSECTION 3. INITIAL TASKS Page i
Initial Tasks
TABLE OF CONTENTS
3.1 PRE-AWARD ACTIVITIES......................................................................................................13.1.1Purpose..................................................................................................................................13.1.2Procedure...............................................................................................................................13.1.3Exhibits..................................................................................................................................33.1.4Checklists...............................................................................................................................3Pre-Bid Meeting Agenda [SAMPLE] (EXHIBIT 3.1.2-A)..................................................................4Pre-Bid And Site Inspection Visit Contracts Agenda Checklist (EXHIBIT 3.1.2-B)............................5Pre-Award Meeting Agenda [SAMPLE] (EXHIBIT 3.1.2-C).............................................................6Pre-Award Action Checklist (EXHIBIT 3.1.4)...................................................................................7
3.2 PRE-CONSTRUCTION MEETING..........................................................................................93.2.1Purpose..................................................................................................................................93.2.2Procedure...............................................................................................................................93.2.3Exhibits................................................................................................................................103.2.4Checklist..............................................................................................................................10Pre-Construction Meeting Agenda [SAMPLE] (EXHIBIT 3.2.2-A)..................................................11Kickoff Letter To Contractor [SAMPLE] (EXHIBIT 3.2.2-B)..........................................................14Notice of Site Mobilization (EXHIBIT 3.2.2-C)...............................................................................17Pre-Construction Meeting Checklist (EXHIBIT 3.2.4.).....................................................................18
3.3 FILING SYSTEM.....................................................................................................................193.3.1Purpose................................................................................................................................193.3.2Procedure.............................................................................................................................193.3.3Filing Index..........................................................................................................................213.3.4Exhibit.................................................................................................................................21Contract Management File Index [SAMPLE] (EXHIBIT 3.3.3)........................................................22
3.4 CORRESPONDENCE AND CORRESPONDENCE CONTROL.........................................253.4.1Purpose................................................................................................................................253.4.2Effective Correspondence......................................................................................................253.4.3Procedure.............................................................................................................................263.4.4Exhibits................................................................................................................................26Correspondence Log - Incoming (EXHIBIT 3.4.2-A)........................................................................27Correspondence Log - Outgoing (EXHIBIT 3.4.2-B)........................................................................28Correspondence Checklist (EXHIBIT 3.4.5).....................................................................................29
3.5 INSURANCE AND BONDS.....................................................................................................303.5.1Scope...................................................................................................................................303.5.2Insurance..............................................................................................................................303.5.3Bonds...................................................................................................................................303.5.4Exhibits................................................................................................................................323.5.5Checklist..............................................................................................................................32Insurance Certificate Review Instructions (EXHIBIT 3.5.4-A).........................................................33
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
TABLE OF CONTENTSSECTION 3. INITIAL TASKS Page ii
Certificate of Insurance (EXHIBIT 3.5.4-A - Attachment A)............................................................36Insurance Register (EXHIBIT 3.5.4-B)............................................................................................37Insurance and Bonds Checklist (EXHIBIT 3.5.6).............................................................................38
3.6 SCHEDULE SUBMITTALS....................................................................................................393.6.1Purpose................................................................................................................................393.6.2Procedure.............................................................................................................................39
-
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 1 of 40
3.1 PRE-AWARD ACTIVITIES
3.1.1Purpose The purpose of this Section is to provide guidance to jobsite personnel withrespect to their participation in the pre-bid and pre-award process.
Pre-Bid Site Visits and Pre-Bid Meetings are held to provide prospectivebidders an opportunity to evaluate jobsite conditions and to obtain clarificationof bid or work scope requirements.
Bid Clarification Meetings are held with selected bidders prior to contractaward to review their proposals and to allow further clarifications, ifnecessary.
Pre-Award Meetings are held with the selected contractor to assure that aclear, mutual understanding of the work to be awarded has been reached.
3.1.2Procedure The following general guidelines apply to all meetings held prior to award:
Each meeting will have an agenda prepared in advance.
Attendance, pertinent information, questions and answers will all berecorded. Bidders should be advised that for fairness and consistencythey are only to rely on written answers to questions. Meetingminutes will be issued, after internal review, to all meeting attendees.However, meeting minutes will not be used to change any contractrequirement. If a change in the contract requirements is necessary,the change will be implemented by addendum to the bid documents.
All contacts with bidders prior to award of the contract are to becoordinated through the designated representative.
The objective of the meetings held prior to award is to do the best jobpossible to ensure there is a meeting of the minds regarding the contractrequirements.
The Pre-Bid Meeting is an opportunity to elaborate on therequirements as stated in the bid documents. In addition, it provides aforum for an interactive exchange with potential bidders to discussquestions and concerns they may have. (Refer to Exhibit 3.1.2-A fora sample Pre-Bid Meeting Agenda.)
3 INITIAL TASKS
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 2 of 40
The Pre-Bid Site Visit provides bidders an opportunity to examine thesite and locale in order to reach their own conclusions regarding themany site related factors, e.g., physical conditions/constraints, labormarket, laydown area, access/congestion. (Refer to Exhibit 3.1.2-Bfor a Pre-Bid and Site Inspection Visit Contracts Agenda Checklist.)This is also an opportunity to share any unique or "superior"knowledge you may have regarding the project or site and how suchfactors might affect the contract. If there are separate jobsite visits,each bidder should receive the same information and any questionsanswered must be recorded and shared with all bidders.
Bid Clarification Meetings are held to resolve any questions that mayarise with respect to bids from bidders in the competitive range. BidClarification Meetings may evolve into negotiation sessions. Terms,scope or price issues may arise that require negotiation to resolve.
The Pre-Award Meeting is held only after selection and approval of acontractor, but prior to award (Refer to Exhibit 3.1.2-C for a samplePre-Award Meeting Agenda). The Pre-Award Meeting provides anopportunity to reaffirm and confirm understandings that have beenreached during the pre-bid/bidding stages and an opportunity to resolvedetail level issues that affect the contractors mobilization. Thefollowing should be addressed:
Confirm that all addenda issued during the bidding process havebeen incorporated in the contract scope, specifications anddrawings.
Review the contract drawings to ensure that all changes discussedhave been incorporated in the "Issued for Construction" set.Formally set aside (forever) the "Bid Drawings". Ideally this isaccomplished with a drawing by drawing review of the Issued forConstruction drawings to ensure no design evolution has crept in.If the drawings are not ready for reissue at the time of award, theaward will state that the Bid Issue Drawings (with markups, ifapplicable) constitute the Contract Drawings. If the Bid IssueDrawings are to be used "For Construction" they shall bedesignated "Issued For Construction".
Confirm acceptability of all proposed substitutions.
Confirm any agreements reached with respect to work plan,access, changes in sequence or other schedule constraintsnecessary for the contractor to be able to make its initial schedulesubmittal.
Discuss in detail owner provided materials, services and facilities in
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 3 of 40
Reinforce the pre-mobilization administrative requirements (e.g.insurance, bonds, pre-job labor conference) that can betroublesome if not handled properly.
Discuss specific activities that must be accomplished to receivemobilization payment, if applicable. (Refer to Section 5.3 entitled"Progress Measurement and Payment.")
Combining Pre-Award and Pre-Construction Meetings
There are some situations where a Pre-Construction Meeting (referenceSection 3.3) and a Pre-Award Meeting can be held as a single meeting.In these cases, the agenda should be adjusted for appropriate contentand the minutes should indicate a joint meeting.
3.1.3 Exhibits Pre-Bid Meeting Agenda [Sample] (Exhibit 3.1.2-A)Pre-Bid and Site Inspection Visit - Contracts Agenda Checklist (Exhibit 3.1.2-B)Pre-Award Meeting Agenda (Exhibit 3.1.2-C)
3.1.4 Checklists Pre-Award Action Checklist (Exhibit 3.1.4)
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 4 of 40
Pre-Bid Meeting Agenda [SAMPLE] (EXHIBIT 3.1.2-A)
Contract:
Contractor:
1. Introduction of company (and Customer) participantsA. Point of contact for questionsB. Role of participantsC. Brief description of evaluation and target award dateD. Discussions and meeting minutes cannot change requirements, only addendum
2. Review of technical requirements by Engineering representativeA. Overview of scopeB. Interfaces with others' work packages/crewsC. Explain drawing release planD. Explain use of RFI'sE. Quality
3. Review site considerations by Construction representativeA. Safety considerationsB. Access and work areasC. Facilities and utilities providedD. Permits required and permits furnishedE. Labor relations
This presentation may include a jobwalk of the work site.*
4. Review schedule requirementsA. Milestone datesB. Reporting requirementsC. Work execution/ interface
5. Review bid package mechanicsA. Explain Exhibit C forms individuallyB. Explain formation process and content of contractC. Describe written question and answer process and stress that all questions must be in
writingD. Describe bid package addendum processE. Restate due dates and point of contact
6. ConclusionsA. QuestionsB. Minutes will be provided by the company and sent to all attending Bidders, company
Departments and Owner
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 6 of 40
Pre-Bid And Site Inspection VisitContracts Agenda Checklist (EXHIBIT 3.1.2-B)
1. Site conditions under which the work will have to be performed.__________
2. Access to the project and the work area. __________
3. Contractor laydown area(s). __________
4. Location, capacity and details of Customer/Company -Furnished power, water, fuel,and compressed air. __________
5. Material handling equipment and procedures. __________
6. Site investigation program (i.e. borings, samples, test pits, borrow pits, quarries).__________
7. Customer/Company -furnished permits, contractor-furnished permits and __________generation of hazardous waste.
8. Customer/Company -furnished facilities and schedule for availability (e.g. camp,warehousing, delivery or construction materials or equipment on site, contractorresponsibility for loading, unloading, storing of Customer/Company -Furnishedmaterials). __________
9. Contractor participation in the company's safety and first aid programs.__________
10. Other work which will or may be in progress during the term of the contract.__________
11. Scope of work for the contract and any unusual or difficult construction that maybe required. __________
12. Point out building sites, access roads, borrow pits, and other important sitefeatures. __________
13. Work of a similar nature, if underway on the site, to show the required standardof workmanship. __________
14. On foreign jobs, available communications set-up for on-job and external to job.__________
15. Location of disposal areas for cleanup purposes, and cleanup areas where morethan one contractor is working. __________
16. Full scope of the project and the facilities yet to be performed that will have aninfluence on the work of the contract being bid.__________
17. Details of the work which might involve premium time. __________
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 7 of 40
Pre-Award Meeting Agenda [SAMPLE] (EXHIBIT 3.1.2-C)
Request for Proposal (RFP) NO._________________
Title:_________________________________________
1. General Introduction
1.1Introduction; Individual greetings and Attendance Sheet signature1.2Purpose; Review and sign finalized contract1.3Distribution; Provide contractor copy of Contract Documents.
2. Contract Document Review
2.1RFP Changes; Discuss agreed changes and indicate where incorporated in the Contract Documents.
A.Specifications; Technical Department (Engineering and Construction) input as required
B.Drawings; Technical Department input as requiredC.Terms and Conditions
2.2Contract Interpretation; Review Terms and Conditions utilizing the General and Special Conditions definitions in Appendix I of the Contracts/Subcontracts Formation Manual.
3. Securities (bonds or bank guarantees) and Insurance
3.1Securities; Remind contractor when they are due or collect securities.3.2Insurance; Remind contractor when they are due or collect insurance certificates.
4. Jobsite Requirements
4.1Jobsite Procedures; Construction to review Jobsite Procedures which bid was based on (key procedures should have been issued at Pre-bid Meeting).
4.2Jobsite Update4.3Labor Agreements and Trade Council Meetings
5. Contract Signing
5.1Contractor Copy; Contractor takes home signed copy.5.2Company Copy; Copied to provide conformed copy distribution and then maintained
in Procurement contract formation file.5.3Customer Copy; Only when the company is agent a third signed original is provided,
otherwise conformed copy(ies) will suffice.
6. Turnover to Contract Administrator
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 8 of 40
6.1Point of Contact; Exchange notification with contractor under the General Condition titled NOTICES.
6.2Meeting Minutes; Announce meeting minutes will be prepared and distributed to all parties and Company/customer departments in attendance.
Pre-Award Action Checklist (EXHIBIT 3.1.4)
Contract Number:_____________________Contractor:______________________________
ContractScope:________________________________________________________________________
1. Pre-bid: Company/Customer provided materials, facilities and construction servicesreviewed.
YES NO
Comments:
2. Pre-bid: Contract Schedule conforms to project schedule.YES NOComments:
Pre-bid: Special construction support requirements, if any, reviewed.YES NO
Comments:
Bid Evaluation: Bidder understands total scope. YES NO
Comments:
5. Bid Evaluation: Manpower loading reviewed. YES NO
Comments:
6. Bid Evaluation: Bidders schedule and construction plan reviewed and resolved.YES NO
Comments:
7. Bid Evaluation: Substitutions, if any accepted/rejected (list accepted substitutions).YES NO
Comments:
8. Bid Evaluation: Bidder's Safety and Health Plan and experience reviewed anddetermined to be satisfactory?
YES NO
Comments:
. Pre-Award: Pre-Mobilization requirements reviewed and understood.YES NO
Comments:
10. Pre-Award: Issued for Construction drawings reviewed -- all bid periodcomments/changes incorporated.
YES NO
Comments:
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.1 PRE-AWARD ACTIVITIESSECTION 3. INITIAL TASKS Page 8 of 40
Name:_______________________________ Date:______________________________
-
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 9 of 40
3.2 PRE-CONSTRUCTION MEETING
3.2.1Purpose The goal of the Pre-Construction Meeting is to achieve a mutualunderstanding with the contractor regarding the way in which the contractrequirements will be translated into action.
3.2.2 Procedure A meeting agenda will be developed. (Refer to Exhibit 3.2.2-A for a samplePre-Construction Meeting Agenda.)
There are some situations where a Pre-Construction Meeting and a Pre-Award Meeting (reference Section 3.1.) can be held as a single meeting. Inthese cases, the agenda should be adjusted for appropriate content and theminutes should indicate a joint meeting.
The Pre-Construction Meeting will be conducted prior to the contractor'smobilization.
The contractor will be provided an advance copy of the agenda.
Each participant will be instructed by the meeting leader on the scope oftheir involvement.
Attendance at the meeting will be recorded.
A contract representative will prepare the meeting minutes and formallydistribute them to the contractor.
A contract representative will prepare an Action Items List and assumeresponsibility for verifying closure of open items.
A confirming letter summarizing contract management expectations andcontract provisions of particular significance should be sent to thecontractor. (Refer to Exhibit 3.2.2-B for a sample Kickoff Letter.)
3 INITIAL TASKS
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 10 of 40
A Notice of Site Mobilization (reference Exhibit 3.2.2-C) should be issued ifthere is a need to notify various departments of impending mobilization of acontractor.
3.2.3 Exhibits Pre-Construction Meeting Agenda [Sample] (Exhibit 3.2.2-A)Kickoff Letter to Contractor [Sample] (Exhibit 3.2.2-B)Notice of Site Mobilization (Exhibit 3.2.2-C)
3.2.4 Checklist Pre-Construction Meeting Checklist (Exhibit 3.2.4)
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 11 of 40
Pre-Construction Meeting Agenda [SAMPLE] (EXHIBIT 3.2.2-A)
Contract:_____________________________________________________________________________
Contractor:_________________________________________________________________________
I. Introduction and Background
A. Meeting purposeB. Introductions
II. Organization
A. YoursB. ContractorC. Authorized representatives
1. Yours2. Contractor
III. Safety and Health
A. Your policyB. Contractor Safety Action PlanC. First aidD. Fire protection and preventionE. Sanitation and housekeepingF. Review contractor's proposed usage of hazardous materialsG. Hazardous Material handling and disposalH. CitationsI. Drug Testing/Fitness for Duty (as applicable)
IV. Environmental
A. Your PolicyB. Contractor Environmental Control PlanC. Environmental permit requirementsD. Hazardous waste generation and managementE. Asbestos inspection and notificationF. Compliance monitoring
V. Construction
A. Scope
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 12 of 40
B. Facilities and equipment furnished by you, owner and contractorC. Permits and Environmental Impact StatementD. Work coordinationE. Quality control and inspection
VI. Labor Relations
A. Pre-job conferenceB. Craft accessC. Project Labor AgreementD. Job RulesE. Daily Force ReportF. Reporting disputesG. BadgingH. Work assignmentsI. Jurisdictional procedures (disputes/grievances)
VII. Construction Schedule and Progress Reporting
A. Project/construction schedule Initial submittal and requirements for approval Periodic updates
B. Manning curvesC. Contractor-furnished equipment and material (schedule and coordination)D. Four-week rolling scheduleE. Progress review meetingsF. Coordinating work areas with othersG. Coordination meetings
VIII.Quality Assurance/Quality Control/Quality Surveillance
A. Contractor responsibilitiesB. Your/Owner rolesC. Offsite QA/QCD. Pre-fabrication submittal requirements
IX. Drawings
A. Design drawings and their distributionB. Drawing controlC. Contractor drawing submittals, approvals and schedules
X. Other Submittals
A. Fabrication procedures, if requiredB. Construction proceduresC. QA/QC proceduresD. Health and Safety Plan
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 13 of 40
XI. Contract Management
A. Correspondence
1. Addressee2. Control and distribution3. Requirement for sequential serialization4. Formal notices
B. Contract Change Procedures
1. Directed Changes (Authorized)2. Notice Requirements and Constructive Changes (risk of proceeding without authorization)3. Discovery of potential errors, omissions and ambiguities and required notifications4. Cost records - all changes5. Proposal requirements6. Duty to proceed7. Dispute resolution8. Claim submittal requirements
C. Insurance and Bonds -contractor submittals
D. Payments
1. Progress payment schedule2. Progress measurement and approval3. Invoice and Certificates of Payment4. Submittals required prior to payment
(see Mobilization Payment Checklist in Section 5.3)5. Force Account Work
E. Backcharges
1. Notices2. Procedure3. Performance
F. Ethics and Conduct
1. Conflicts of Interest2. Gifts
G. Warranty Procedures
H. Project Schedule Reviews and Coordination Meetings
I. Contract Close-out Procedures
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 14 of 40
Kickoff Letter To Contractor [SAMPLE] (EXHIBIT 3.2.2-B)
To: Smith Construction Company B-SCC-001Subject:COMPANY JOB NO.______________________ DATE
CONTRACT NO.________________________KICKOFF LETTER
Gentlemen:We are pleased to be working on this project with you and look forward to a mutually beneficialrelationship. To ensure that this relationship is a positive one and to avoid any future misunderstandings,we have listed below some of the more important and sometimes overlooked contract articles. Althoughevery provision of the contract is significant, we want to call your particular attention to the following:
Section No.Title Action[Use project article numbers and titles and include clauses which should be highlighted for this particularcontract.]
Authorized Representatives A letter designating the contractor's authorizedrepresentativeand scope of authority should besubmitted to the company prior to the start ofconstruction
Permits The contractor should review this article and confirmthat all required permits, licenses and certifications havebeen obtained prior to the start of construction, and thatall permit conditions are satisfied, prior to, during or afterconstruction.
Labor, Personnel and WorkRules
This provision establishes the contractors obligation tocomply with project labor agreements and provides thebasis for settling jurisdictional disputes. It also establishesthe companys right to remove unacceptable personnel.
Publicity and Prior written permission is required from the companyfor any Advertising announcements, photographs and videos orrelease of any information regarding the contract orProject.
Safety & Health The contractor must comply with the requirements of thecompanys Safety & Health Plan and shall have sole responsibilityto implement its own Safety and Health Program. Please appoint aSafety & Health Representative for your work and inform thecompany of your designation in writing.
Environmental Requirements This provision emphasizes the contractors obligation tocomply with environmental laws, regulations andpractices to minimize adverse impact to the site,personnel on the site and adjacent environmentally
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 15 of 40
a copy of your Environmental Control Plan prior tocommencing work.
Section No.Title Action
Changes This provision establishes the mechanism for change. Aclear understanding and adherence to this provision fromthe onset of the project is of great importance.
Assignments andSubcontracts
Prior written approval from the company is requiredbefore the contractor assigns the contract or enters intoany subcontracts for the performance of work related tothis contract.
Insurance All insurance requirements must be met before mobilization. Areview of the contractor's coverage with the companyrepresentative is required.
Commencement, Progressand Completion of theWork
The contractor will be required to furnish the resourcesnecessary to meet contract milestones. Progress meetingsand schedule submittals will be utilized to monitor thisprogress. The company has the right to direct thecontractor to take corrective action to restore progress tomeet the schedule.
Contract Schedule A detailed CPM contract is to be submitted within thirty(30) days of contract award and is therefore due on orbefore . The progress reports specified in this articlewill be required as stated.
Measurement for Payment The contractor should review this article carefully.An early meeting with the company to ensure a thoroughunderstanding and complete compliance with this article issuggested. The company will supply the correct formsand review the proper invoicing procedures.
The provisions of the contract relating to changes will be strictly observed. Insofar as possible, changeswill be covered by Change Order prior to execution of the work, but if the demand of time or the nature ofthe work makes that impossible, the company may issue written instructions (Change Notices) to proceedwith the change. Any such work undertaken without such written instructions will be at your own risk andany resulting charges may not be allowed. Change Orders will be issued only for work authorized by thecompany. This policy will be firmly enforced and all invoices for work not covered by the contract or byChange Orders will be returned unpaid.
All correspondence you receive from the company will carry sequential serial numbers. Please ensure thatall letters which you send to the company are likewise numbered. All correspondence to and from thecompany will be required to be identified with the contract number, be dated, and carry a unique sequentialserial number. Letter logs will be exchanged on a monthly basis to ensure no letters have been lost ormisplaced.
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 16 of 40
All correspondence you receive from the company will carry sequential serial numbers. Please ensurethat all letters which you send to the company are likewise numbered. All correspondence to and from thecompany will be required to be identified with the contract number, be dated, and carry a unique sequentialserial number. Letter logs will be exchanged on a monthly basis to ensure no letters have been lost ormisplaced.
For example:
Letters To:Smith Construction Company
Letters To:Company (Contract No. )
_____________________[Contracts representative] has been assigned for your portion of this project.[Contracts representative] will work with your field supervisory personnel and will be your primary contactwith respect to construction procedures and technical compliance. When you encounter field problemsthat require our assistance, please bring them to the attention of [Contracts representative]. We expectthat with the help of [Contracts Representative] you will be able to resolve such problems, but if anyshould persist, please feel free to contact me.
We will require [three] copies of all correspondence from your designated representative which shall beaddressed to the attention of the, .
If we can otherwise assist you in any way, do not hesitate to call on us. We feel that your success will beour success and we will extend our cooperation and assistance to the fullest degree possible.
Very truly yours,
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.2 PRE-CONSTRUCTION MEETINGSECTION 3. INITIAL TASKS Page 18 of 40
Pre-Construction Meeting Checklist (EXHIBIT 3.2.4.)
Contract Number:________________________________________Contractor:_____________________
Contract Scope:________________________________________________________________________
1. Need for Pre-Construction Meeting. YES NO
Comments:
2. The date is set PRIOR to contractor mobilization.YES NO
Comments:
3. Agenda issued to contractor and key company participants.YES NO
Comments:
4. Attendance list prepared. YES NO
Comments:
5. Open actions identified. YES NO
Comments:
6. Meeting minutes prepared and issued. YES NO
Comments:
7. Kickoff letter sent to contractor. YES NO
Comments:
8. Notification(s) of contractor mobilization given.YES NO
Comments:
9. Contractor's authorized representative designated.YES NO
Comments:
Name:______________________________________________ Date:___________________________
-
3.3 FILING SYSTEMSECTION 3. INITIAL TASKS Page 19 of 40
3.3 FILING SYSTEM
3.3.1Purpose The Contract Management Files must contain all pertinent original contractdata and documents and be organized to allow for efficient storage,identification and retrieval.
The files should be integrated into the project's document control program.
3.3.2Procedure A complete contract file set will be maintained for each contract. Thefollowing file subjects, as a minimum, will be included:
Conformed Contract
Change Notices/ Change Orders
Amendments
Internal Approval
Chronological, sequentially numbered correspondence and relevantphone notes of telephone and other conversations
- Outgoing correspondence- Incoming correspondence
Insurance and Bond Certificates
Daily Reports
Inspection Reports
Construction Schedules
Requests for Information
Drawing File
Backcharge File
Progress Payment File
3 INITIAL TASKS
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.3 FILING SYSTEMSECTION 3. INITIAL TASKS Page 20 of 40
Minutes of Meetings File
Claims File
Warranty File
Closeout File
At the conclusion of the project all closed contract files will be dispositionedin accordance with project procedures. All contract files that may have abearing on open claims or other unresolved matters are to be separatelydispositioned in accordance with project procedures.
GENERAL DISCUSSION OF DOCUMENTATION
A. WHY IS DOCUMENTATION NECESSARY
Documentation, including a monitoring program for receipt, closeoutand maintenance, is of crucial importance to proper contractmanagement. Its significance cannot be over-emphasized.
B. DISCUSSION
1. Concise and complete documentary records always will have asubstantial effect on the resolution of any problems. Frequently,proper documentation will serve as sufficient and clear evidence toresolve problems at the lowest possible level.
It is imperative in the administration of contracts that significantevents be documented in permanent records such ascorrespondence, written notes and memoranda.
It is essential to summarize important discussions and meetings.Notes covering conferences, telephone calls and discussions, shouldgive the date, location, parties involved and important issuesdiscussed. The contract number should also be included on all ofthese items.
2. In order for any piece of documentation to be useful, it must standon its own. Each must contain information to satisfy thefundamental six questions of what, where, when who, how and why.Documentation should be dated and signed providing continuitythroughout the length of a project. In addition to being complete,documentation must be objective.
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.3 FILING SYSTEMSECTION 3. INITIAL TASKS
Page 21 of 40
If no problems materialize on a contract, it may seem the time andefforts documenting a contract's performance was wasted. This is notthe case, as the documentation effort likely contributed significantly tosuccessful management of the contract.
3.3.3Filing Index The Contract Management Files will conform to approved project documentcontrol procedures and utilize the approved project document controlcomputer tracking program. A Sample Contract Management File Index isprovided in Exhibit 3.4.3.
3.3.4 Exhibit Contract Management File Index [Sample] (Exhibit 3.3.3)
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.3 FILING SYSTEMSECTION 3. INITIAL TASKS Page 22 of 40
Contract Management File Index [SAMPLE] (EXHIBIT 3.3.3)
GENERAL FILES
1.1 File Index1.2 Prime Contract1.3 Contract Plan1.4 Project Master Schedule1.5 Contract Register1.6 Inter-Office Correspondence1.7 Customer Correspondence1.8 Standard Document Distribution1.9 Directives and Special Procedures1.10Site Survey/Soil Reports1.11Site Procedures and Instructions1.12Site Labor Agreement1.13Project F & A Procedures and Audit Programs
CONTRACT FILES
As each contract is awarded and Construction assumes responsibility from Procurement ContractFormation, individual files are established in the following typical major groups:
2.0 CONTRACT2.1 Master Bid Package2.2 Pre-Award Documentation (See Procurement Procedures)2.3 Contract (Conformed Copy)2.4 Change Notice Log2.5 Change Notices2.6 Change Order/Amendment Log2.7 Contract Change Orders/Amendments (Conformed)2.8 Commitment Authorizations2.9 Insurance Correspondence2.10Payment/Performance Bond Correspondence2.11Contract Fact Sheet
3.0 ADMINISTRATION3.1 Backcharge Register3.2 Backcharge Notices3.3 Contractor Schedules
3.3.1Contract Schedule3.3.2Construction Schedules3.3.3Non-Manual Manpower Schedule
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.3 FILING SYSTEMSECTION 3. INITIAL TASKS Page 23 of 40
3.3.1Contract Schedule3.3.2Construction Schedules3.3.3Non-Manual Manpower Schedule
3.4 Contractor Key Personnel, Addresses, Day/Night Phones3.5 Drawing and Specification Control
4.0COMMUNICATIONS4.1 Correspondence Log4.2 General Correspondence Files
4.2.1Correspondence with Customer4.2.2Out-going Correspondence to Contractor4.2.3Incoming Correspondence from Contractor4.2.4Inter-Office Correspondence
4.3 Log/General Facsimile Files4.4 Contacts File (Discussions/Telephone)4.5 Minutes of Meetings4.6 Memos for Record4.7 Transmittal Memo Receipts
5.0 REPORTS5.1 Daily Force Reports5.2 Contractor Daily Report5.3 Progress Reports5.4 Work Interruption Reports5.5 Inspection Reports5.6 Accident Reports5.7 Progress Photo/Video File
6.0 CONTRACTOR PROCEDURES AND PROGRAMS6.1 Safety (Personnel, Equipment, Traffic)6.2 Security6.3 Environmental Compliance6.4 Fire Protection6.5 Inspection6.6 Training6.7 Housekeeping
7.0 CONTRACTOR EQUIPMENT7.1 Equipment Schedule7.2 Control Procedures7.3 Customer/Company -Furnished Tools and Equipment
8.0 PAYMENTS8.1 Contractor Invoices/Applications for Payment
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.3 FILING SYSTEMSECTION 3. INITIAL TASKS Page 24 of 40
8.2 Quantity Verifications (Field Engineering)8.3 Cash Flow/Schedule "S" Curve8.4 Contract Financial Status Sheet8.5 Contractor Forecasts8.6 Contract Trend Reports (if required)8.7 Certified Payroll Reports (if required)
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.3 FILING SYSTEMSECTION 3. INITIAL TASKS Page 25of 40
9.0 ACCEPTANCE AND CLOSEOUT9.1 Final Inspection Reports9.2 Punch List Reports9.3 Taking Over Works9.4 Completion Certificates9.5 Maintenance Certificates9.6 Final Acceptance9.7 Closeout
10.0WARRANTIES10.1Log10.2Vendor Backcharges10.3Site Backcharges or Rework Accounts
11.0 CLAIMS11.1Contractor Proposal/Claims Log11.2Contractor Proposals (Claims)11.3Claims Analysis11.4 Statements/Depositions (Personnel Concerned)11.5Claims Correspondence
11.4.1Customer Correspondence11.4.2Company/Contractor Correspondence
11.6Claims Reports to Management11.7Claims Settlement Agreements
12.0CONTRACTOR PERFORMANCE EVALUATION/HISTORICAL12.1 Fact Sheet and Historical Record12.2 Performance Evaluation
-
3.4 CORRESPONDENCE AND CORRESPONDENCE CONTROLSECTION 3. INITIAL TASKS Page 25 of 40
3.4CORRESPONDENCE AND CORRESPONDENCECONTROL
3.4.1Purpose Contract correspondence control is designed to ensure that allcorrespondence to and from a contractor is accounted for, required repliesare sent and responses received, correspondence is cross-referenced,correspondence can be quickly identified and retrieved, and actionrequirements generated by correspondence are closed out on a timely basis.
3.4.2EffectiveCorrespondence
Make an exceptional effort to eliminate any chance of communications beingmisunderstood. Clear communication is essential to contract managementsuccess. Everyone on the project team should understand that all contractualcommunications may have legal ramifications, or at a minimum, be one ofthe primary tools available to reconstruct facts if a dispute arises.
Correspondence should have a well defined purpose. Separate topics shouldbe addressed in separate letters. Clear, simple language should be used.Ideas should be presented logically.
To maximize the value and effectiveness of correspondence:
Serialize all contract correspondence
Log all contract correspondence to ensure accountability for actionand timely responses.
Coordinate all outgoing correspondence through one individual percontract
Periodically exchange logs with contractors to secure agreement onopen and closed items
Write a separate letter for each subject
Keep all correspondence objective and factual (avoid inflammatorylanguage or style)
Clearly state the subject in all correspondence
Identify all referenced items by title, date or revision
Identify all enclosures
Establish a minimum response time for all communication andclearly state this in the correspondence
3 INITIAL TASKS
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.4 CORRESPONDENCE AND CORRESPONDENCE CONTROLSECTION 3. INITIAL TASKS Page 26 of 40
Outgoing correspondence which requires no response should sostate
Show "blind" distribution on the file copy
Date stamp all incoming correspondence to establish chronology
Acknowledge every letter by one of the following:
-Answer as required by incoming letter
-Interim reply if full response cannot be provided within theestablished time period and then maintain an action item list toensure follow up.
3.4.3Procedure Correspondence to and from each contractor will be sequentially numberedfor each contract.
All outgoing and incoming correspondence will be logged, action/replyresponsibility assigned, and replies recorded. Correspondence control logsshould be checked weekly to ensure that all open items are taken care of andto provide follow-up. Larger projects are encouraged to electronically "sort"the logs and distribute an open correspondence report weekly as a controldevice. Ideally the project should exchange logs monthly with the contractorto confirm agreement on open and closed items as well to confirm receipt ofcorrespondence requiring no response.
Original documents will be retained in the Contract Management Files andonly copies will be circulated.
Email, while an attractive convenience, is not to be used for contractcorrespondence unless each transmittal is serially numbered, logged, signed andcontrolled in the same manner as hard copy correspondence.
By establishing designated points of contact, you can control the flow ofcorrespondence. The authorized signatory should be identified to the contractorin writing and no others should sign correspondence. However, various people onthe project team may originate correspondence. An appropriate counterpart in thecontractor's organization should be identified as contractor's addressee. (Multipleoriginators and multiple addressees results in lack of coordination andconsistency.)
Contract management correspondence control will conform to approvedproject document control procedures and utilize the approved projectdocument control computer tracking program. A Sample ContractManagement File Index is provided in Exhibit 3.3.3.
3.4.4Exhibits
3.5.5 Checklist
Correspondence Log - Incoming (Exhibit 3.4.2-A)Correspondence Log - Outgoing (Exhibit 3.4.2-B)
Correspondence Checklist (Exhibit 3.4.5)
-
(Outgoing)Correspondence Log
COMPANY: JOB NO.:
CONTRACT NO.: CONTRACTOR:
NOTE: ENTER ONLY ONE LETTER PER LINE
LETTER REQUESTREPLY
DATE ACTION CONTRACTOR
SERIAL NO. DATED ANSWERING LETTERSUBJECT NO YES REPLY ASSIGNED
Expedition
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.4 CORRESPONDENCE AND CORRESPONDENCE CONTROLSECTION 3. INITIAL TASKS Page 29 of 40
Correspondence Checklist (EXHIBIT 3.4.5)
Contract Number:________________________ Contractor:___________________________
Contract Scope:________________________________________________________________________
1. Correspondence is objective/factual and has the appropriate tone.YES NO
Comments:
2. Correspondence is input to correspondence/document control system.YES NO
Comments:
3. All letters to contractor including email are being logged and tracked.YES NO
Comments:
4. All letters from contractor, including email are being logged and tracked.YES NO
Comments:
5. Open items are identified. YES NO
Comments:
6. Open items are statused and updated (at least bi-weekly). YES NO
Comments:
7. There are no past due action due dates. YES NO
Comments:
8. No letter numbers are missing. YES NO
Comments:
9. YES NO
Comments:
Name:___________________________________ Date:___________________________
-
3.5 INSURANCE AND BONDSSECTION 3. INITIAL TASKS Page 30 of 40
3.5 INSURANCE AND BONDS
3.5.1Scope This procedure outlines the requirements for obtaining, verifying andmonitoring contractor Certificates of Insurance and bonds.
3.5.2Insurance Certificates of Insurance are submitted by a contractor to confirm that theinsurance policies required by the contract have been obtained. Becauseinsurance policies can expire by their terms, their expiration dates must bemonitored and policies extended as necessary.
The contractor should submit a Certificate of Insurance or otherdocumentation of insurance meeting contract requirements immediatelyfollowing contract award but no later than contractor's site mobilization.Contractors without complete and satisfactory Insurance Certificates willnot be permitted to mobilize. Furthermore, if during the course of the work,the contractor's insurance expires or is significantly modified, the contractormust be denied access to the site until the required insurance is in place.
Verify that the certified insurance coverage conforms to the contractrequirements and is valid. (Refer to Exhibit 3.5.4-A for Insurance CertificateReview Instructions.)
After the contractor starts work, Insurance Certificates will be monitored toverify that the coverage is maintained in force and proper renewal isobtained by the contractor.
An Insurance Register with expiration dates will be maintained (referenceForm 3.5.4-B).
An early notification system (tickler) which identifies 45 days in advancethose Certificates which require renewal will be maintained.
3.5.3Bonds A performance bond is a surety company's guarantee that the obligationsthat the contractor undertakes pursuant to the contract will be performed,including those that extend past final acceptance (e.g., warranty). Apayment bond ensures that the contractor's suppliers and subcontractors arepaid for the work and/or material they supply. Performance and paymentbonds are typically issued together as a package for a single premium.Bondingrequirements, if any, are contained in the contract. Performance andpayment bonds should be in a penalty amount equal to 100% of the contract.There is no reduction in bond premium for a reduced bond penalty.
3 INITIAL TASKS
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.5 INSURANCE AND BONDSSECTION 3. INITIAL TASKS Page 31 of 40
The contractor should submit performance and payment bonds which meetcontract requirements immediately following contract award. Typically, thesuccessful bidder's bid bond is not returned until receipt of satisfactoryperformance and payment bonds. Note that bonds do not normally need tobe updated during the course of the work. If extra work is added that isequivalent to another contract, it will be necessary to obtain another bond tocover this work.
Verify that the bonds conform to the contract requirements and have beenissued.
Note that while Change Notices do not normally necessitate notification tothe bonding company, Contract Amendments for extra work outside of theoriginal scope of the contract may require specific notification to the bondingcompany to ensure coverage of this extra work.
Verify that the bond(s) conform to the contract requirements. The suretyshould be on the U.S. Department of Treasury's approved list of sureties.
When a contractor is required to obtain a performance/payment bond, thepremium is based on the final contract price. Therefore, an adjustment to thepremium will apply when pricing change orders. Performance and paymentbonds typically provide coverage for the contractually specified warrantyperiod without an additional premium.
Advance payments to a contractor in excess of what has been earned underthe contract should not be made. Such payments may be construed to be"loans" to the contractor and therefore not credited toward the contractbalance owed by the bonding company.
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.5 INSURANCE AND BONDSSECTION 3. INITIAL TASKS Page 32 of 40
An Advance Payment Bond is a special category of payment bond (unrelatedto the standard performance/payment bond) which is sometimes used oninternational projects but rarely in the U.S. An Advance Payment Bondassures that moneys advanced to the contractor will be used in connectionwith the project. Such a bond may be required prior to making advancepayments to the contractor.
A Maintenance or Warranty Bond is usually written by the surety thatprovided the Performance and Payment Bond and provides an extendedwarranty for defects in materials and workmanship. Its cost is significantlyless than that of the Performance and Payment Bond. The normal penaltyamount is 10% of the contract price.
When a contractor's supplier or a lower-tier subcontractor has filed a lienagainst the owners property, you may require the contractor to purchase arelease of mechanic's lien bond to release the lien. Thesupplier/subcontractor's lien is then attached to the bond allowing the lien tobe removed from the customer's property. In effect, these bonds allow theproject to be turned over to a customer without any encumbrances and allowthe contractor to receive its retention pending resolution of the dispute withits suppliers and subcontractors. Such bonds will typically have a penaltyamount of 125% to 150% of the lien obligation.
In some jurisdictions, to be able to file a lien the contractors must submit aPreliminary Notice of Intent to file a lien at the start of work. ThePreliminary Notice looks very much like a lien and can be alarming, but hasno adverse consequences.
Reference Special Topics Section 7.2 "Basis for Claims" pages 27 and 28.
3.5.4 Exhibits Insurance Certificate Review Instructions (Exhibit 3.5.4-A)Insurance Register (Exhibit 3.5.4-B)
3.5.5 Checklist Insurance and Bonds Checklist (Exhibit 3.5.6)
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.5 INSURANCE AND BONDSSECTION 3. INITIAL TASKS Page 33 of 40
Insurance Certificate Review Instructions (EXHIBIT 3.5.4-A)
PURPOSE
To establish responsibility for acquiring initial contractor submitted Certificates of Insurance and toprovide guidelines for determination of the validity of such Certificates.
DEFINITIONS
A Certificate of Insurance establishes that the contractor has appropriate insurance to cover claims forwhich the contractor is responsible.
REQUIREMENTS
Attachment A is a sample Insurance Certificate. The sections below provide explanations anddirections. The numbers also correspond to the sections on the Certificate.
1.This is the date the Certificate of Insurance was typed.
2.The name and address of the agent or broker who placed the insurance coverage for the contractor.
3.The name and address of the contractor who provided the evidence of insurance on the Certificate.
Verify that the name of the contractor is the same as the name in the contract.
4.The names of the insurance companies providing the insurance for the insured.
When there is any question about a contractor purportedly having valid insurance coverage,contact the insurance company directly referencing the policy number.
5.Letter designation will indicate which insurance company is providing insurance coverage from thelist of insurance companies under Companies Affording Coverage.
6.Type of Insurance identifies the specific insurance being provided.
Commercial General Liability (formerly Comprehensive General Liability) is the insurancegenerally available to contractors to cover third party liability arising from their operations. Thistype of policy includes the following coverages:
Premises and Operations Products and Completed Operations Contractual Liability Broad Form Property Damage Explosion, Collapse and Underground Hazards Personal Injury Liability Cross Liability or Severability of Interest Clause
The company requires that the Commercial General Liability policy be on an OccurrenceForm. This form provides coverage for a loss that happened during the policy term even if
-
CONTRACT/SUBCONTRACT MANAGEMENT MANUAL
3.5 INSURANCE AND BONDSSECTION 3. INITIAL TASKS Page 34 of 40
Cross Liability or Severability of Interest Clause
The company requires that the Commercial General Liability policy be on anOccurrence Form. This form provides covera