K-12 Construction Change Orders - The Quest for Negative Change Orders

Part 1 in a 4 Part Series

Part 1 - The Teaser...

It is reasonable for a K-12 Owner to strive and succeed in having ‘negative change orders’ when the project is closed out. Ergo, the adjusted sum of the construction contracts after the project is closed out can be less than the sum of the construction contracts initially awarded by the school board. We know .. because Fidevia has accomplished this on multiple occasions.

Last year Fidevia closed out our latest project with negative change orders .. a brand-new elementary school .. a project that involved extensive site work on a compromised site. When the dust had settled, the School District could report to its taxpayers that it had returned all of the project contingency it had set aside for change orders .. significant funds that could be reallocated for other endeavors.

The goal of this 4 Part Series is to lay out a detailed strategy and game plan for how a Pennsylvania School District can best plan and construct/complete a project without using project contingency and achieve negative change orders.

This Part 1 throws down the gauntlet .. While most prudent construction planning suggests allocating a construction contingency of between 3 – 10% depending on a host of project conditions and constraints, we are boldly suggesting higher aspirations.

Part 2 will identify the problem we are trying to solve .. namely, there are some Owners who fear the change order process .. and many others who have had poor experiences with extensive and/or costly change orders that blow budgets and cause much consternation on multiple levels. In almost all cases, this problem need not exist. The first step in developing an effective strategy to eliminate this problem is to clearly articulate and lay a foundation .. and, in this case, that requires us to take a detailed look at all of the causes for and classifications of change orders on a school construction project.

Part 3 will pragmatically explore the various contract clauses a K-12 Owner can responsibly and ethically utilize as part of an overall effort and

Part 4 will tie everything together with useful design phase thru construction and closeout phase practice pointers that should be employed on any construction project.

We sincerely hope you will find this mini-series informative and cost - saving to you and yours.