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Measurement and Payment Module #5 PowerPoint PPT Presentation


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Measurement and Payment Module #5. Prepared by Dr. Randy R. Rapp July 2005. Contractual Payment. Lump-sum or fixed-price Unit-price Fixed-price with cost incentives Time and materials (T&M). Progress Payments. Typically monthly Contractor request maybe 10 days prior

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Measurement and Payment Module #5

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Measurement and payment module 5 l.jpg

Measurement and PaymentModule #5

Prepared by

Dr. Randy R. Rapp

July 2005


Contractual payment l.jpg

Contractual Payment

  • Lump-sum or fixed-price

  • Unit-price

  • Fixed-price with cost incentives

  • Time and materials (T&M)

2005, Randy R. Rapp


Progress payments l.jpg

Progress Payments

  • Typically monthly

  • Contractor request maybe 10 days prior

  • Lump-sum vs. unit-price verification

  • Inspector role

    • Measure quantity and type of work

    • Claims for extra work and change orders

    • Calculate payment due, minus retention

    • Prepare and forward recommendation

  • Lump-sum vs. unit-price payment basis

2005, Randy R. Rapp


Conflicting bases of payments l.jpg

Conflicting Bases of Payments?

  • Specification writer misunderstands?

  • Lump-sum contract

    • Schedule of values OR

    • Cost-loaded critical path method (CPM) network

  • Unit-price

    • Neither schedule of values NOR

    • Cost-loaded CPM

2005, Randy R. Rapp


Payment request evaluation l.jpg

Payment Request Evaluation

  • Lump-sum: completed work package

    • Discernable fraction thereof is usually OK

    • Consider change orders, if any

  • Unit-price: quantity x unit-price

    • Measurement accuracy absolutely essential

    • Renegotiate unit-price, if quantity exceeds allowable variation (15% to 25%)

  • Equipment and materials delivered but not yet installed

    • Maybe pay actual cost for long-lead, high-cost items

    • Only if contract specifically stipulates

2005, Randy R. Rapp


Force account l.jpg

Force Account

Day work

  • Measurement and Payment section OR

  • Changes and Extra Work section

  • “Reasonable” allowance for overhead and profit?

  • Categories

    • Labor

    • Materials

    • Equipment

  • Payment is full compensation for the work

2005, Randy R. Rapp


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Force Account (Cont’d)

  • Labor

    • Trade classification wage rate and numbers

    • Foremen included, not general supervisors

    • Any allowances?

  • Materials: cost and freight

  • Equipment

    • DOT rates or Rental Rate Book

    • Active and standby times

  • Markups (p.85)

2005, Randy R. Rapp


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Payment for Extra Work

  • Often detailed in Supplementary General Conditions

2005, Randy R. Rapp


Payment for mobilization l.jpg

Payment for Mobilization

  • Lump-sum contracts

    • Not included as a bid item: likely inflated

    • Include as a calculated allowance in separate technical section, per contract requirements

    • Not a matter of Measurement and Payment

  • Unit-price contracts

    • Properly in Measurement and Payment

    • Lump-sum amount stipulated in extended column

2005, Randy R. Rapp


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Partial Payments

  • Partial waivers of lien (subs’ waivers maybe one payment behind prime contractor’s)

  • Total cost pricing of change orders

  • Forward pricing of change orders

  • Retainage

  • Liquidated damages

2005, Randy R. Rapp


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Field Measurement for Payment

  • Pipeline lengths

    • Beware delivered vs. plan or in-place

    • If in-place, measure centerline on top

  • Earth and rock volume

    • Bank vs. compacted

    • Weight vs. volume (survey profile prior to work)

  • Curbs: top edge toward street

  • Sewers: do not include manholes

  • Fence: plan or top rail in-place

2005, Randy R. Rapp


Field measurement for payment cont d l.jpg

Field Measurement for Payment (Cont’d)

  • Pavement

    • Areas or weights

    • Unit-prices for handwork vs. equipment

  • Retaining walls

    • Inside vs. outside surface measurement

    • Calculate non-overlapping prism volumes

2005, Randy R. Rapp


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Final Payment

  • Additional requirements

    • Pay all project debts

    • Submit receipts, releases, waivers of lien

    • Obtain consent of surety

  • Besides retainage

    • Liquidated damages

    • Punch list work (1.5 to 2 times value)

    • Liens already filed

  • Upon filing Notice of Completion or Substantial Completion

    • Sometimes time limitation to announce intent to file lien

    • Time limitation to actually file

2005, Randy R. Rapp


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