Common use of Change Directive Clause in Contracts

Change Directive. A Change Directive is a written order prepared and signed by the City Manager directing a change in the Contract prior to agreement on adjustment, if any, in the Contract Amount or Contract Time, or both. The City Manager may by Change Directive, without invalidating the Contract, order changes in the Contract within the general scope of the Contract consisting of additions, deletions or other revisions, with the Contract Amount and Contract Time being adjusted accordingly. (1) A Change Directive may be issued by the City Manager at any time in the absence of a written agreement with the Contractor on the terms of a Change Order. (2) Upon receipt of a Change Directive, the Contractor shall promptly commence and proceed with the prescribed change(s) to the Services involved. (3) If the Change Directive provides for an adjustment to the Contract Amount, the adjustment shall be based on one of the following methods: (1) A reasonable lump sum including a reasonable fixed fee or percentage fee properly itemized and supported by sufficient substantiating data to permit evaluation; (2) Unit prices stated in the Contract or as subsequently agreed upon; (3) Reasonable cost plus a reasonable fixed fee or percentage fee; or (4) As provided in Section I.3(c) (5) below. (4) A Change Directive that is signed by the Contractor indicates the Contractor’s agreement therewith, including adjustment in Contract Amount and Contract Time or the method for determining them. Such agreement shall be recorded as a Change Order. (5) If the Contractor disagrees with the method for adjustment in the Contract Amount or Contract Time, or both, set forth in the written Change Directive, the Contractor must promptly, but in no event later than forty-eight (48) hours from the date of receipt of the written Change Directive, give written notice of its disagreement. In such event, the City Manager shall determine the adjustment on the basis of reasonable additional costs or savings resulting from the Services attributable to the change, including, in the case of an increase in the Contract Amount, an amount for overhead and profit as set forth in the Contract, or if no such amount is set forth in the Contract, a reasonable amount. In such case, under Section I.3(c)(3)(iii), the Contractor shall keep and present, in such form and manner as the City Manager may prescribe, an itemized accounting of costs together with appropriate supporting data. Unless otherwise provided in the Contract, costs for the purposes of this Section I.3(c)(5) shall be limited to the following: (i) Fully burdened labor costs; (ii) Costs of materials, supplies and equipment, including cost of transportation, whether incorporated or consumed; (iii) Rental costs or amortized cost of machinery and equipment; and (iv) Additional costs of premiums for bonds and insurance, permit fees, and sales, use or similar taxes related to the Work. Failure to provide written notice of disagreement or objection within the proscribed time period set forth in this section shall be deemed a waiver of any such disagreement or objection. (6) Pending final determination of the total cost of a Change Directive to the City, the Contractor may request payment for Services completed under the Change Directive. The City Manager will make an interim determination for purposes of payment for those costs and certify for payment the amount that the City Manager determines to be reasonably justified. The City Manager’s interim reasonable determination of cost shall adjust the Contract Amount on the same basis as a Change Order, subject to the right of either party to disagree and assert a Claim in accordance with Article I.4