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upon in writing before the work is started. The RE should use an existing item name and number from the BAMS listing whenever possible. Item names may be modified by including the change order number if needed to prevent confusion with an existing contract item (example: Unclassified Excavation (CO # 3).

When a Change Order involves a price reduction using an Item Deduction, the Prime Contractor must state in a letter that they accept the reduction. This letter must contain the basis of the deduction (i.e., %, $/ton, lump sum, etc.,) and, whenever possible, Total Dollar amount of the reduction. (EXCEPTION: No letter is required when Specifications mandate a reduction in pay, such as for Water for Grass, when a contractor has not complied with Section 620.)

When a new unit price is required in conjunction with a Change Order, the Resident Engineer must request and obtain the Contractor's proposed unit price. The proposed unit price for the new item shall be set forth in a letter from the Contractor to the Resident Engineer.

If the Contractor proposes a unit price which is less than or equal to the latest Weighted Average Unit Price and is considered equitable, a Change Order may be submitted for review without an analysis of the cost. The Contractor's original letter containing the proposed Unit Price shall be attached to the Change Order.

When change orders involve extra work and the time needed to complete this extra work would exceed the normal time extension as a result of overruns based on money value, the completion date or work days may be extended by change order to provide for the difference. An analysis of time, similar to Figure 104-3A (page 100-19), and a letter of concurrence from the contractor should be submitted with any change order that adds work days or extends the completion date as described above.

If the proposed unit price is such that further justification is needed which the Resident Engineer cannot provide, the Contractor will be required by the Resident Engineer to submit such additional information or documentation as needed to justify the proposed Unit Price. This may include, but is not limited to, a listing showing the number, types, and hours of usage for equipment; a listing of the numbers and hours for personnel; and a list of the materials required. The Contractor's letter containing the proposed Unit Price and any other worksheets or documents used by the Resident Engineer to establish the Unit Price shall be attached to the Change Order. The Resident

Engineer shall review the Contractor's







costs and computations insurance, workmen’s

and verify them, inasmuch compensation, and other

benefits expense

should be reviewed carefully to insure that contractor organization is not included in the markup submitted. Only the actual amount

or of

overhead insurance

and payroll taxes paid 109.04 of the Standard

by the Contractor on the labor used Specifications provides instructions

will be allowed. Subsection for these computations to the

Contractor and shall be used in this review. The “Rental Construction Equipment” is available at the District Headquarters Engineer in the review of equipment rate computations.

Rate Blue Book for for use by the Resident

Rev. 8-14-06

Page 100-10

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