Payments under Fixed-Price Construction Contracts

In some cases, payment will be expected upfront, but others may want you to pay once the job is complete and you have approved of the results. When speaking to your contractor about the important aspects of the project, be sure that it is made clear when you will need to make a payment so there are no complications.

The fixed-price-incentive fee contract has ceiling price, which is expected to cover all potential risk. After the allocated budget for the project is solidified then the profit sharing formula is put into place. This profit sharing formula will help contractors to focus on controlling cost and meeting project objectives in reasonable time line.

Contractors bid on U. S. Federal Construction projects and most contracts for federally assisted constructions exceeding $2,000 required to pay their employees the standard wage and benefit package that workers in the area performing similar work are earning the

CONTRACTOR shall procure any required CONTRACTOR Permits, and shall furnish any documentation, bonds, security or deposits required to permit performance of the Work.

Don't Pay All Up Front: If your home improvement contractor asks for all of the money up front, take this as a red flag. Typically, most licensed contractors will require a third of the job be paid up front, the rest to be paid upon completion of the work.

Then set attainable schedules, as schedules like “pretty on paper” and are nowhere near reality. Thorough time and cost supervision improves trustworthiness. Per chance implement a specific team to monitor the schedule and budget standards. Then impress upon the team to alert me on any important issues before the next project meeting. Then, I believe that an external body should examine the work being done by the contractors to find any defects. Yes, this project was funded by federal and state money and I am sure that there were engineers and architects monitoring the quality of the work being done. However, from experience, so many short-cuts are used by contractors to save time and money. Furthermore, many inspectors truly do not pay attention to everything. So with this, I believe that fines and penalties should be assessed to the contractors if imperfections are found in the future that are related to craftsmanship. Additionally, fines must be related to the contractor’s inability to meet time lines. However, if the contractor can supply valid issues related to their inability to deliver, fines will not be

Contracting issues: be clear about the deliverables and timeline, and documents should clearly define the scope and requirements of each deliverable.

Subcontractor is responsible to inform TEPSCO representatives of any change to original subcontract price. Unless a signed change order has been issued and approved, TEPSCO is not responsible for additional costs. The parties involved in this subcontract can change its provisions only by written modification.

Example: ABC Land Development hired D. E. Farnsworth (engineer) and GHI Architects to conduct a feasibility study on a 3.5 acre piece of land that ABC Land Development wanted to buy. D.E. Farnsworth was responsible for completing a land assessment that expressed whether or not the land was suitable for ABC Land Development’s plans. The land assessment provided by D.E. Farnsworth was not enough for a clear-cut decision, so GHI Architects were called in to complete additional analyses. As requested, GHI Architects created detailed site drawings and preliminary building plans. In addition to the request, GHI Architects drafted building specifications that targeted parts, materials, and facility systems. ABC Land Development utilized the data provided by GHI Architects to

B. Many times some or all of the following documents may be required by the contractor:

3. If the contract doesn’t have applicable and similar cost in it, the contractor should propose a cost and submit to the stakeholders to get a approval, and carry out.

The contractor has given full acknowledgement that all work has been accepted and paid in full.

The Contract is awarded to the Approved Contractor after reaching satisfaction that expectations can be met and mutually agreeable terms have been achieved during the Pre-Award Meeting. Procurement will coordinate the preparation of Contract documents.

• Furnish all information and reports required by the executive order and the implementing regulations, and permit access to the contractor’s or subcontractor’s books, records, and accounts by the contracting agency and the Secretary of Labor for purposes of investigation to ascertain compliance with the executive order and its regulations (Bennett-Alexander & Hartman, 2007, p. 189).

It is essential that project managers have a thorough understanding of procurement concepts, and the contracts that are involved in the practice. This assignment will focus on the types (Fixed Price, Cost Reimbursable, and Time and Material), and subtypes of procurement contracts, and discuss the pros, cons, and the burden of risk of each. At the end of the assessment, (FFP). This a clear understanding of which type of contract is least advantageous choice for the ACME breakroom construction project. Further, the paper will highlight this type of contract is a bad choice, and discuss