Los Angeles Unified School District

General Conditions Seminar

February 1, 2006

Article 1.2 (Definition)

Article 1.2 Administrative Contract Closeout: New term/language: “The Administrative Contract Closeout time shall be the duration allowed for completion of all Contract requirements beyond Substantial Completion such as Punch List items, submittal of final warranties and guaranties, and record documents.”

Article 1.5 (Definition)

Contract Time: Amended to: “The original duration of the Contract from the Notice to Proceed to the Administrative Contract Closeout period, plus Change Order adjustments.”

Term

Final Completion: Term deleted from General Condition.

Article 1.40 (Definition)

Punch List: “ A list of minor, corrective items, and can be corrected in the time frame established by the Administrative Contract Closeout period

Article 1.5(Definition)

Substantial Completion: Amended to: “The stage in the progress of the Work when all of the requirements of the Contract are completed, except as to any Punch List items, if any, final warranties and guaranties, and record documents submittals.”

Article 2.2 – Notice to Proceed(Contractor Benefit)

Notice to Proceed: Added liquidated damages against the District to encourage OAR not to shelf project. A graduate scaled sum of $100 to $1,000 per day based on estimated Project construction value as liquidated damage (LD) is to be paid to CONTRACTOR beyond 60 days until 120 days from the Notice of Award. If Notice to Proceed is not issued after 120 days from the Notice of Award, the Contract will be terminated. This Article is also incorporated in Section 0800 for the OAR to amend the LDs sum in accordance with the Project construction value.

Article 2.5.2 – Schedule of Values (Contractor and Owner Benefit)

Schedule of Value (SOV)s:i. Deleted the 90-Day Schedule of Values

requirement language. ii. New language added establishment requirements

and reservations in case the SOV is not submitted and/or approved:a. A default Schedule of Values % concept will be

used for first 3 initial Application of Payments.b. After the first 3 months, OWNER reserves the

right to engage consultants to fulfill these requirements. OWNER’s incurred costs for the additional consultant services will be assessed against CONTRACTOR.

Article 2.8.1- Baseline Schedule (Owner Benefit)

Baseline Schedule: Deleted the following language from Section 01360 Div. 01 and transferred it to the General Condition. “ At any time during the Project, If CONTRACTOR fails to comply with Article 2.9 Baseline Schedule requirements, OWNER reserves the right to engage independent estimating and scheduling consultants to fulfill these requirements. Upon notice to CONTRACTOR, OWNER shall retain against CONTRACTOR all incurred costs for these additional services.”

Article 3.15 – Contract Documents(Contractor and Owner Benefit)

Deleted notion referencing relation and services between the Architect and OWNER. These relationship and services are irrelevant to the contract between CONTRACTOR and OWNER.

Article 3.16.3 New Language

“The Contract Amount and Contract Time can only be changed by Change Order”.

Article 3.17 – Document Retention(Contractor Benefit)

Document Retention Policy: The new language is similar to the one previously under Article 6.55 Audit Process, except the document retention time period is changed from four (4) to ten (10) years. CONTRACTOR may maintain documents in hard copy or electronic form.

Articles 5.7 – OCIP Obligations Policy Contractor Benefit

Changed CONTRACTOR enrollment time in the OCIP from five (5) to ten (10) days.

Articles 6.14 - Substitutions(Owner Benefit)

Changed the time required for substitution of material from within 11 days after the Notice to Proceed (NTP) to 35 days after the Notice of Award (NOA) to conform to public code.

Article 6.43 – Safety & Protection(Contactor and Owner Benefit)

Added Safety representative requirement to conform to OCIP manual.

Articles 6.48 - Submittals(Owner Benefit)

Changed ARCHITECT requirement language from “review and approve” to “review” Shop Drawings, Samples; and Product Data and Material lists. The new language conforms to current ARCHITECT submittal processing.

Article 6.53 Payroll(Contractor and Owner Benefit)

i. New language was also added under Section 0800 Supplemental Conditions, allowing OAR to change working hours for special circumstances, as necessary.

ii. Liquated damages language added against the CONTRACTOR if the CONTRACTOR neglect, fails or refuse to submit Payroll Records requested by the OWNER. (Owner Benefit)

Article 6.53.7 PSA(Contractor Employee Benefit)

i. New language was added requiring CONTRACTOR to post flyers relating to employee benefits. This requirement is also added to Division 01.

ii. New language requiring CONTRACTOR to submit with its final Application for Payment a certification that the CONTRACTOR and its Subcontractors have paid all benefit contributions due to the appropriate trust funds. A new form was created and is included under Division 01 for the CONTRACTOR use.

Article 6.55 – Right to Audit (Owner Benefit)

Right to Audit: This Article was changed to:i. Add consequences in case of CONTRACTOR

refusal to comply with the audit where CONTRACTOR may be subject to adverse evaluation and/or removal from the list of pre-qualified contractors.

ii. Revise OWNER audit administrative expense cost to be reimbursed by the CONTRACTOR at a threshold dollar amount of $40,000 instead of 1% of the Contract Amount.

iii. Added legal services to the OWNER audit administrative expense list.

Article 9.4.7 - RFC (Owner Benefit)

Added new language making the CONTRACTOR responsible for expenditure incurred by the District in reviewing any Request for Clarification (RFC) submitted by the CONTRACTOR that require no explanation except references to specific pages, drawings, section or Articles in the Contract Documents.

Article 10 - RFP & COP (Contractor & Owner Benefit)

i. Add time requirement (10 days) for issuance of a COP after a Request for Proposal (RFP) is issued by OAR, unless indicated otherwise. (Owner Benefit)

ii. Remove the word “Claim” and replace it with “written notice” and or “dispute” to conform to Article 16 Dispute and Claim Resolution. (Contractor Benefit)

Article 10 – RFP & COP (Cont.)(Contractor & Owner Benefit

..Continuediii. Add language requiring the

CONTRACTOR to review all tiers of Subcontractor cost and time before submitting them to the District. (Owner Benefit)

iv. Add language that the cost of COP shall cover any and all cost, including those due to delay and damages associated with the COP. (Owner Benefit)

Articles 11.5 - Cost of the Work (Contractor & Owner Benefit)

i. Delete payroll cost for project manager and superintendent. These costs are deemed to be part of the overhead and profit markup. (Owner Benefit)

ii. Define prevailing wages and fringe benefits. (Contractor Benefit)

Articles 11.5 – Cost of the Work (cont.)(Contractor & Owner Benefit)

….Continuediii. Specify supplemental cost to include usage cost

of CONTRACTOR owned equipment in accordance with the Rental Rate Blue Book or Equipment Rental Rates published by Caltrans. (Contractor Benefit)

iv. Define rental equipment as part of the cost of Work in accordance with the Rental Rate Blue Book or Equipment Rental Rates published by Caltrans. (Contractor & Owner Benefit)

Articles 11.7 (Overhead & Profit) (Owner Benefit)

i. Specify cost items that are deemed to be part of the CONTRACTOR overhead and profit on the project and are included in the bid Contract Amount and/or covered by the CONTRACTOR fee markup such as “payroll cost for project manager and superintend, consumable materials, tools and equipment with less than $1,000 in value”. (Owner Benefit)

ii. Add language requiring CONTRACTOR to credit the OWNER for any Subcontractor deleted work, a markup fee equal to 5% of the net decrease. (Owner Benefit)

Article 11.7 - Overhead & Profit (Cont.)(Owner Benefit)

…Continued

iii. Add language allowing CONTRACTOR a fee equal to 5% for rented equipment and not allowing any markup on CONTRACTOR owned equipment.

Article 11.13 – Compensable Delay (Contractor & Owner Benefit)

• Add language defining % markup fee and specify cost items allowed under Compensable Delay.

Article 12.1.1 – Contract Time (Contractor & Owner Benefit)

New Article: “CONTRACTOR represents to the OWNER that the Contract Time is sufficient to perform the original scope of work in accordance with the Contract Documents. The CONTRACTOR agrees that the Contract Amount complies with prevailing wage requirements and includes all premium time and/or overtime costs required to properly staff the job to complete the Project within the Contract Time.”

Article 13.13.5 – Owner Consultants (Contractor Benefit)

OWNER Consultant amended: OWNER will consider providing professional consultants such as IOR, etc at no additional cost to the OWNER “when specified observations, testing, inspection and approval costs associated with CONTRACTOR provided materials, products, fabrications or assemblies are outside a sixty (60) mile radius of the Project site.

Article 13.27 – Defective Work (Contractor & Owner Benefit)

Prior to final Application for Payment, the OAR may issue a Construction Directive for any defective work acceptable by the District and the CONTRACTOR shall provide a credit (deductive) COP to the District for accepting such defective Work.

Article 14.10 – Reduction of Retainage (Contractor Benefit)

Added language stating that the OWNER may elect to release any retainage withheld in excess of the legally mandated 5% of the Contract Amount, except any other amount held against the CONTRACTOR, such as Stop Notices, LDs, etc..

Language with regard to notarized consent of surety to reduction of retainage was deleted.

Articles 14.16 - Substantial Completion(Contractor and Owner Benefit)

i. Substantial Completion: This Article was amended to require CONTRACTOR to submit a writing request (using the District’s form) to OAR to issue a Certification of Substantial Completion. The form identified as “Request for Certification of Substantial Completion” in Division 01 made available for the CONTRACTOR to use and to certify under perjury that the Work is substantially complete.

Articles 14.16 - Substantial Completion(Contractor and Owner Benefit)

…Continuedii. Punch List shall only include minor

corrective items, and shall not include incomplete Work.

iii. OWNER shall allow CONTRACTOR reasonable access to correct items on the Punch List during normal hours when possible and without disturbing school operations throughout the Administrative Contract Closeout period.

Articles 14.19 – Final Payment(Contractor Benefit)

• Final payment is submitted when work is deemed and certified as substantially completed.

Articles 14.20 – Notice of Completion(Contractor Benefit)

• Notice of Completion: When the Work has been certified substantially completed, the OWNER shall record a Notice of Completion with the County Recorder.

Articles 14.22 – Release of Retention (Contractor Benefit)

• Release of Retention: Within sixty (60) days after Substantial Completion, the retention shall be paid, except for one-hundred fifty percent (150%) of any amount in dispute and/or which OWNER otherwise has a right to withhold.

Articles 14.24 Administrative Contract Closeout & Release of Withholds (Owner Benefit)

• Administrative Contract Closeout and Release of Withholds: “After Administrative Contract Closeout completion, if agreed to by the OWNER, CONTRACTOR shall immediately take all measures to correct and/or remedy said disputes. OWNER may exercise the right to exclude CONTRACTOR from performing any more Work after the Administrative Contract Closeout date; and CONTRACTOR will be assessed actual cost for the unsettled items. Release of withholds shall take place when items in dispute are resolved.

Article 15.5.12 – Non-Safety Violations (Contractor Benefit)

Changed the 3-Day Notice to a 5 Day Notice including new requirement with regard to the performance bond surety. The 5 Day Notice form under Division 01 Section 01020 was amended to conform to this article.

Article 16 – Dispute & Claim Resolution(Contractor and Owner Benefit)

Mandatory Dispute & Claim Resolution Process:

i. Define “Dispute” as a demand or assertion by the CONTRACTOR regarding money and/or time adjustments with which the OAR does not agree.

ii. Define “Claim” as a dispute that has not been resolved by the OAR, the RD/RPMD and CCU.

Article 16 – Dispute & Claim Resolution(Contractor and Owner Benefit)

…Continued

iii. Limit the overall time to resolve any dispute to approx. 40 days from the time OAR issues the rejection to the time CCU renders a decision.

iv. Provide process for resolving claim. Overall time is tie to mediation and maybe Civil Action period. (A Civil Action cannot be filled until after Substantial Completion).

Other - Instruction to Bidders(Contractor Benefit)

Section 00200 Article 1.10 F

• Bid shall be guaranteed for a period of sixty (60) days from the date of submission, or as extended by mutual agreement.

Other –Faithful Performance Bond-Pg 1(Owner Benefit)

DOCUMENT 00605

FAITHFUL PERFORMANCE BOND

WHEREAS, LOS ANGELES UNIFIED SCHOOL DISTRICT BOARD OF EDUCATION, Hereinafter called OWNER, and _________________________________________________________________________________________

hereinafter called CONTRACTOR, have entered into a Contract, which is incorporated by reference herein in its entirety, Dated: __________________________________________________, for: ___________________________________________________________________, Contract Amount: __________________________________________________. NOW, THEREFORE, CONTRACTOR, as Principal, and _______________________________________________________, as Surety; are held and firmly bound to OWNER for the performance and the payment of the amounts as set forth in, and as otherwise incorporated into, this bond, and that the CONTRACTOR and Surety also bind themselves, their heirs, executors, administrators, successors and assigns, jointly, severally, and firmly, by these promises: The condition of this obligation is that if the CONTRACTOR shall in a workmanlike manner promptly, competently, and faithfully perform all of the terms, conditions and provisions of the Contract, in strict conformity therewith, then the obligations under this bond shall be null and void, otherwise the obligations under the bond shall remain in full force and effect. If CONTRACTOR is in breach or default, or is deficient, under the Contract and is declared by OWNER to be in breach or default, or deficient under the Contract, and Owner exercises its right to terminate CONTRACTOR’s right to proceed, OWNER shall give Notice to CONTRACTOR and Surety as required by the Contract, if any, and Surety shall do one or more of the following: 1. Promptly remedy, and/or start to remedy, the declared breach/default/deficiency within the times

specified in the Contract or within such longer period of time as the Owner may designate, and Surety shall competently, faithfully and diligently continue to perform until the declared breach/default/deficiency has been fully and completely remedied; and/or

2. Complete the Contract in accordance with its terms and conditions; and/or 3. Pay to the Owner an amount not to exceed one hundred percent (100%) of the original Contract Amount

stated above, plus an amount equal to one hundred percent (100%) of each increase to the Contract Amount added by Change Orders, that will fully and completely compensate OWNER for any and all damages, losses and injuries suffered by OWNER as a result of CONTRACTOR’s breach (es) of, or defaults/deficiencies under, the Contract.

Other - Faithful Performance Bond-Pg2 (Owner Benefit)

These rights and remedies of OWNER are cumulative and in addition to all other OWNER rights and remedies. Surety expressly agrees that OWNER may reject for cause any contractor or subcontractor which may be proposed by Surety in fulfillment of its obligations in the event that OWNER declares a breach/default/deficiency by CONTRACTOR. The Surety, for value received, hereby stipulates and agrees that no adjustment to the Contract Amount and or Contract Time, alteration, additions and/or deletions to the terms of the Contract, or to the Work to be performed thereunder, shall in anyway affect its obligations on the above bond, and it does hereby waive notice of any such change, adjustment, alteration, addition or deletion to the terms of the Contract Documents. As a condition precedent to the satisfactory completion of the Contract, the above obligations shall hold good for a period of one (1) year after the acceptance of the work by OWNER, or such longer period of time if set forth in the Contract or otherwise provided by law, such that during said period of time(s), if CONTRACTOR shall fail to make full, complete, and satisfactory repairs and replacements and totally protect the OWNER from injury, loss or damage made evident during the applicable period from the date of completion of the work, and resulting from or caused by defective materials, faulty workmanship, or any other breach of the Contract requirements, the above obligations, including the penal sum, shall remain in full force and effect. The obligation of Surety hereunder shall continue so long as any obligation of CONTRACTOR remains. In case any suit is brought upon this bond, reasonable attorneys’ fees shall be awarded to the prevailing party, only the amount thereof being within the Court’s discretion. Signed and sealed this _____ day of_____________________________________20___________ CONTRACTOR SURETY By ________________________________________ By______________________________________________ Attorney-in-Fact Title _____________________________________ Address__________________________________________

Telephone Number_________________________________ Bond Number_____________________________________ OWNER will obtain the following certification: CERTIFICATION BY LOS ANGELES COUNTY CLERK'S OFFICE I hereby certify: 1. The named Surety is currently certified by the State Insurance Commissioner as an admitted Surety

Insurer and such authority is in full force and effect. 2. This office has on file the financial statement of the named surety for the period ending________________

showing capital and surplus not less than ten (10) times the Contract Amount.

Conny B. McCormack, County Clerk Date: ______________________ By: ____________________________________ Deputy

(THIS DOCUMENT CANNOT BE ALTERED, MODIFIED, OR CHANGED.)

END OF DOCUMENT

Revised General Conditions …

Please visit our website for additional information at:

www.laschools.org/contractor/

Revised General Conditions …

Questions from the audience?