Common use of CM’s Contingency Clause in Contracts

CM’s Contingency. 13.3.1 The Guaranteed Maximum Price Proposal may include a CM Contingency amount to be used to fund increases in the Direct Construction Cost of the Project identified through the refinement, development and completion of the Construction Documents or procurement of the Work. The CM Contingency shall be negotiated between the parties and it shall reflect the risk inherent in the state of completion of the Construction Documents at the time the GMP proposal is submitted. 13.3.2 Any re-allocation of funds from the CM’s Contingency to cover increases in the Direct Construction Cost must be approved by the Owner in advance and in writing, such approval not to be unreasonably withheld. In written requests to use the CM’s Contingency, the CM shall provide detailed documentation of the scope of work affected and the basis for any increases in costs resulting in the need to use CM Contingency funds. 13.3.3 As the Construction Documents are finalized and the Buyout of the Work progresses the CM’s Contingency amount shall be reduced by mutual agreement of Owner and Contractor. The Buyout shall occur within the first 20% of the construction duration for each NTP issued for construction. Should savings occur after the Buyout stage, such savings, and related reductions to the CM’s Contingency amount, will be handled in accordance with the provisions of Article 15.