Measurement and Payment

1
Measurement and Payment
2

• Construction Progress Payments
• Contractor gives a bill for progress to RPR
• Outlines what bill is for
• Give details as needed (quantities)
• RPR reviews
• Approves (sends to owner) or disapproves (calls
  contractor)
• Contractor gets paid

3

• Approval of Payment Requests
• RPR responsible for checking quantities and costs
• Quantity take off
• Inventory of equipment and materials on site but
  not used
• Field measure work completed or claimed
• Construction Cost Estimate of all completed work
• Audit of Invoices and costs
• Review of claims for extra work and completed
  change orders
• Check of retention amount
• Check method used for profit and overhead,
  material costs for estra work or change orders

4

• Basis for Payment Amounts
• Accuracy of field measurements determined by
  contract type
• Lump sum contracts do not need accurate field
  measurements
• Cost plus or Unit price contracts need very
  accurate field measurements
• Pg 432

5
Schedule of Values v. Cost loaded CPM Schedule

• Unit Price Contracts
• Do not call for Cost Loaded CPM Schedule
• Conflicts with line items on unit price sheet
• Do not call for schedule of Values
• A breakdown of all line items is submitted w/
  contractors bid and is binding throughout job

6

• Lump Sum Contracts with Cost Loaded CPM
• Do not ask for Schedule of Values cost loaded
  CPM is equal
• Request Cost loaded CPM be submitted before first
  pay period ends
• Lump Sum Contracts w/o Cost loaded CPM
• Do not ask for a cost loaded CPM schedule
• Do not ask for a bid breakdown
• Request a schedule of values before starting work
  on project

7
Evaluation of Contractors Payment Requests

• Contractor submits request for payment at a
  prearranged date each month for previous months
  work
• Lump sum contract payment based on a fair
  estimate of work completed plus overhead and
  profit
• Unit Price Contracts contractor gets paid based
  on quantity used RPR must have accurate field
  measurements
• /- 25 is okay more or less allows for
  renegotiations by either party

8

• Equipment And Materials delivered but not used
• Contractor brings stuff on site early
• May try to bill owner since stuff is on site
• Contractor only paid when stuff is used
• Includes materials used but not completed pipe
  not paid for until covered and tested
• Unit price contracts are usually for installed in
  place materials on site is not in place
• Can make exceptions for long lead items which
  arrive on site early

9

• Force Account
• Daywork or for any type of cost plus payment
• In US associated with extra work and change
  orders
• May be used to pay contractor when it is
  difficult to provide adequate measurements or
  estimate cost of certain items of work
• Should be last choice when setting up items for
  payment

10
Force Account

• Change order is a must
• Force account payments not authorized for supers.
  Allowances for supers is in contractors OP.
  Foremen working full time on item would be
  covered by account
• PM has authority to direct every aspect of force
  account work

11

• PM and Contractor must agree on
• Labor
• Classification and approximate N of workers, wage
  rates, travel allowance, subsistence, are foremen
  included
• Equipment
• Types to be used including size, rating,
  capacity, which indicate that item can do work
  required, owned or leased, cost per hour for use
• Materials
• Cost and freight charges, purchased for project
  or from contractors stock

12

• PM prepares lists of equipment and labor
  classifications actually used and corresponding
  rates
• Equipment list includes complete nomenclature of
  the equipment to establish rental rate from a
  Rental Rate Book
• Labor list includes labor classification and
  composite hourly rate (basic wage added costs
  listed in DOT standard specs)

13

• Payments for Extra Work and Change Orders
• Usually laid out in Contract
• Common is cost plus with a reasonable allowance
  for OP
• State agencies may allow 15, 20, 24,33 on labor
  and then 15 on equipment, 15 on materials 5 on
  primary subs (not subs subs)

14

• RPR must evaluate all change orders and requests
  for payment of extra work
• RPR should consult PM or owner to determine the
  exact terms of the agreement that cover extra
  work
• RPR keeps daily record of extra work performed
  and materials used