CPR, Hourly Labor Rate Worksheets: Prior to the first change order, CA shall request and receive the first two weeks of certified payroll and the Hourly Labor Rate Worksheet for the Contractor’s workers and all subcontractors on the project, and may request additional weeks of certified payroll as necessary. This information is required to establish the Contractor’s and subcontractors’ labor burden.
Subcontractor Directory: CA shall also request that the Contractor submit a Subcontractor Directory, which will assist in identifying whether a listed subcontractor is a subsidiary of the Contractor or whether the subcontractor is owned or partially owned by the Contractor (shared profits), and therefore, help CA safeguard against abuse of change order mark-ups.
Change OrderCA shall require that the Contractor use the Contractor Change Order Request Summary Worksheet and require its subcontractors to use the Subcontractor Change Order Request Summary for all change order requests. When the proposed need for a change order is first known by the design professional, s/he shall prepare a change proposal, which is the conceptual approval form and should be prepared for each change as early as possible, in order to reserve funds for the proposed change.
The design professional shall discuss all proposed or requested changes to the contract with the CA prior to or concurrent with preparing a change proposal. The CA shall determine whether or not to proceed with the proposed or requested change. When so notified by the CA, the design professional shall proceed with the change proposal. No extra services are to be used by the design professional prior to the approval. A partial purpose of the change proposal is to eliminate unnecessary cost proposal requests to the Contractor and to control additional construction and design costs.
Bid allowances are typically included in base bids as estimates for work that will be completed under the base construction contract, but the exact costs or scope are indeterminate at the time of bid. These amounts are later adjusted to actual costs, once the work is completed. The Trustees, with advice from the Architect, should specify the scope and value for each allowance. Examples of allowances include: keying, hard rock excavations, special utility permits or utility connection fees, signage, or unspecified finishes. The total of all allowances shall not exceed ten percent of the project’s construction value.
Allowances should be specifically included and listed on the bid proposal form, on the schedule of values, and referenced and defined in Division One specifications (in section 01 21 00). It is important to include in the Division One specifications exactly how mark-ups will apply to allowances. This should eliminate claims or disputes regarding application or mark-ups on allowances.
A contractor may request a substitution of a listed subcontractor under the The Subletting and Subcontracting Fair Practices Act (PCC 4100 et seq.), using one or more of the nine types of substitutions provided by the Act: Public Contract Code Section 4107(a). Upon receipt of Contractor's written request for substitution citing one or more reasons listed in 4107(a), the Construction Administrator (CA) shall adhere to the following procedure:
CA shall act timely in issuing five working days written notice to the listed subcontractor, and tracking the five-day response period. OGC issued the opinion that the five-day period equates to the response time for subcontractor to mail its response. Therefore, CA shall wait three more days beyond the expiration of the five-day period to receive any such mail, and postmark on subcontractor's letter is the date the responsed is deemed to be received. If subcontractor does not respond timely, or responds that they do not object to the substitution, CA shall send a letter to all parties approving the substitution.
Protest of Substitution: If a protest is received from the subcontractor to be substituted, CA shall expeditiously contact CPDC Chief of Construction Management, requesting she/he appoint a hearing officer, and then CA may schedule a substitution hearing. If either or both the prime contractor and subcontractor give notice that they intend to bring their attorney, then University Counsel must also attend. Though it may be very difficult to set a hearing time with so many parties, it is CSU's obligation to make an effort to schedule a timely hearing. If the only time when all parties are available is unreasonable or too far in the future, then CA will issue a hearing notice by certified mail. In this notice CA shall give the two principal participants five working day notice (plus mailing time) of the hearing, at the time and place specified; failure to attend will waive their rights. Contact CPDC Chief of CM or University Counsel for more information on the substitution hearing as this is a formal process to which CSU staff must adhere.
Inadvertent Clerical Error: Under PCC 4107(a)5 and 4107.5, if the prime contractor made an inadvertent clerical error in the subcontractor list submitted with his bid, s/he has two working days after the time of the bid opening to give written notice to the CSU, the listed subcontractor and the intended subcontractor. The listed subcontractor has six working days from the time of the bid opening to submit to the awarding authority and the prime contractor its written objection. If a protest is received, CA shall timely call and hold a substitution hearing.
Other bases for substitution: PCC section 4107(a)4, failing or refusing to meet the prime contractor's bond requirements. This statute requires the prime contractor to advertise its subcontractor bond requirements. Failure to do so shall preclude the prime contractor from substituting for not meeting bond requirements. A warning is included in the Contract General Conditions, see Article 4.04.
PCC section 4106 identifies that if a prime contractor fails to specify a subcontractor or specifies more than one subcontractor for the same portion of work, that work being valued greater than one half of one percent, then it agrees to and shall perform that work himself. No subcontractor shall be employed by the contractor to perform work valued at more than one half of one percent if the original subcontractor listing indicated that the prime contractor was going to perform the work.
Subcontractor Directory: CA is required to police the use of subcontractors using the Subcontractor Directory, created to police contract compliance. CGC requires Contractor to submit the Subcontractor Directory with the contract award package to the Trustees, and with each payment request that follows. CA shall compare the Subcontractor Directory with the Expanded List of Subcontractors. If any listed firms have been substituted without approval in accordance with PCC Section 4107(a), penalties are applicable per PCC Section 4110 (SUAM Sections 9821, 9823). Note: the listed subcontractor must perform the scope of work for which it was listed. Contractor/Campus may use another subcontractor for added work via change order.
Penalty: The penalty for violating the provisions of the Subletting and Subcontracting Fair Practices Act is identified in PCC Section 4110. CA shall provide Contractor notification of assessment of penalty or termination and a public hearing held. If a ten percent penalty is assessed, the monies remain in the project funds. If the violation is egregious, then this may be used as a basis of disqualification (in the Prequalification process). Again, notification needs to be issued and the opportunity for a disqualification hearing allowed.
Important to Note: