109.05 Payment for Contract Revisions - Revision history

Deboerm: /* Materials */

2020-07-22T14:39:05Z

Materials

Deboerm: /* Equipment listed in the Blue Book (EquipmentWatch) */

2019-08-27T15:41:20Z

Equipment listed in the Blue Book (EquipmentWatch)

Deboerm: /* Equipment listed in the Blue Book (EquipmentWatch) */

2019-08-26T18:28:56Z

Equipment listed in the Blue Book (EquipmentWatch)

Deboerm: /* Negotiated Prices (109.05.C) */

2019-03-11T13:12:24Z

Negotiated Prices (109.05.C)

Deboerm: /* Conclusion */

2019-02-06T16:45:38Z

Conclusion

Clarkj25: /* Small Tools */

2019-01-16T20:52:56Z

Small Tools

McGowanR: Clarification related to small tools for Force Account Work

2019-01-16T18:29:17Z

Clarification related to small tools for Force Account Work

JohnsonN23 at 19:06, 19 June 2017

2017-06-19T19:06:50Z

Show changes

JohnsonN23: /* Labor */

2017-06-01T18:00:26Z

Labor

JohnsonN23: /* Force Account (109.05.D) */

2017-06-01T17:59:45Z

Force Account (109.05.D)

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 For materials used and accepted by the engineer the contractor will receive the cost of materials delivered including tax and transportation charges plus 15 percent overhead.  Materials such as tarpaulins and mats, etc. that are not incorporated into the finished work and retained by the contractor are considered to be overhead.
-Contractors are reimbursed actual costs of material delivered to site, including freight.  An invoice or a bill for materials is not by itself sufficient documentation to prove payment was made.  A copy of a paid invoice from the supplier with a check number/electronic transfer, or copy of the cancelled check proving payment must be attached to the force account statement.  Credit for contractor’s discounts must be included on the invoice, penalties for late payment will not be considered.
+Contractors are reimbursed for actual costs of material delivered to site, including freight.  Credit for contractor’s discounts must be included on the invoice, penalties for late payment will not be considered.
 Any materials incorporated permanently on the project needs a Materials Source List (MSL), material certification/test report, and Buy America certification requirements for steel.
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 ====[[#Equipment|Equipment]]====
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 =====[[#Equipment listed in the Blue Book (EquipmentWatch)|Equipment listed in the Blue Book (EquipmentWatch)]]=====
-Determination of the rental and operating rates will follow subsection [http://mdotcf.state.mi.us/public/specbook/files/2012/109%20Measurement%20&%20Payment.pdf 109.05.D.6.a.i] of the 2012 Standard Specifications for Construction.  The equipment costs need to be determined for the time period which the force account work was performed. The EquipmentWatch Blue Book must be used to determine the reimbursement rates for equipment, these rates can be located on the EquipmentWatch website. Department employees can access the EquipmentWatch Blue Book information via a link located on the Construction Field Services SharePoint [http://app.equipmentwatch.com/search page]. Non MDOT personnel should contact their respective TSC’s to obtain copies of EquipmentWatch pages.
+Determination of the rental and operating rates will follow subsection [http://mdotcf.state.mi.us/public/specbook/files/2012/109%20Measurement%20&%20Payment.pdf 109.05.D.6.a.i] of the 2012 Standard Specifications for Construction.  The equipment costs need to be determined for the time period which the force account work was performed. The EquipmentWatch Blue Book must be used to determine the reimbursement rates for equipment, these rates can be located on the EquipmentWatch website. Department employees can access the EquipmentWatch Blue Book information via a link located on the Construction Field Services SharePoint [https://stateofmichigan.sharepoint.com/sites/mdot/Organizational/field_services/construction/SitePages/Home.aspx page]. Non MDOT personnel should contact their respective TSC’s to obtain copies of EquipmentWatch pages.
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 =====[[#Equipment listed in the Blue Book (EquipmentWatch)|Equipment listed in the Blue Book (EquipmentWatch)]]=====
-Determination of the rental and operating rates will follow subsection [http://mdotcf.state.mi.us/public/specbook/files/2012/109%20Measurement%20&%20Payment.pdf 109.05.D.6.a.i] of the 2012 Standard Specifications for Construction.  The equipment costs need to be determined for the time period which the force account work was performed. The EquipmentWatch Blue Book must be used to determine the reimbursement rates for equipment, these rates can be located on the EquipmentWatch [http://app.equipmentwatch.com/search website]. Department employees can access the EquipmentWatch Blue Book information via a link located on the Construction Field Services SharePoint [http://app.equipmentwatch.com/search page]. Non MDOT personnel should contact their respective TSC’s to obtain copies of EquipmentWatch pages.
+Determination of the rental and operating rates will follow subsection [http://mdotcf.state.mi.us/public/specbook/files/2012/109%20Measurement%20&%20Payment.pdf 109.05.D.6.a.i] of the 2012 Standard Specifications for Construction.  The equipment costs need to be determined for the time period which the force account work was performed. The EquipmentWatch Blue Book must be used to determine the reimbursement rates for equipment, these rates can be located on the EquipmentWatch website. Department employees can access the EquipmentWatch Blue Book information via a link located on the Construction Field Services SharePoint [http://app.equipmentwatch.com/search page]. Non MDOT personnel should contact their respective TSC’s to obtain copies of EquipmentWatch pages.
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 =====[[#Equipment not listed on Blue Book (EquipmentWatch)|Equipment not listed on Blue Book (EquipmentWatch)]]=====
 Determination of the rental and operating rates, for a similar piece of equipment, will follow subsection [http://mdotcf.state.mi.us/public/specbook/files/2012/109%20Measurement%20&%20Payment.pdf 109.05.D.6.a.ii] of the 2012 Standard Specifications for Construction.  Rates must be agreed upon and documented before the equipment is used. Allowable rates for miscellaneous contractor owned equipment typically not listed in the Blue Book are available on the link below:<br />

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 **Use of production rates, estimating manuals and/or national cost estimating publications can also be used to help support the cost analysis.
-The preceding information and cost justification is to be noted in the reason section for extra work items on contract modifications and the supporting information placed in the project file..
+The preceding information and cost justification is to be noted in the reason section for extra work items on contract modifications and the supporting information placed in the project file.
 After agreement is reached with the engineer and contractor on pricing the extra work from unit price or negotiated price methods, then the engineer should prepare a contract modification to document the agreement and begin the payment process per the guidance in [http://mdotwiki.state.mi.us/construction/index.php/Construction_Contract_Modification_Process_Overview#Contract_Modification_Development Contract Modification Development].

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 |1090003||Negotiated Force Account||Lump Sum
 |}
-To be used for all time and material/force account situations. Partial payments can be made using this pay item based on Engineers acceptance of the work and approval of supporting documentation (see Contractor Payment Section).  The negotiated force account pay item code must be used when work which commenced under the force account method has since been negotiated by the engineer and contractor to be a lump sum item of work.
+To be used for all force account situations. Partial payments can be made using this pay item based on Engineers acceptance of the work and approval of supporting documentation (see Contractor Payment Section).  The negotiated force account pay item code must be used when work which commenced under the force account method has since been negotiated by the engineer and contractor to be a lump sum item of work.
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 Consumable supplies (welding rod, welding gas, gasoline, diesel, etc.) will be considered incidental and will not be reimbursed separately.   Costs for these direct materials consumed in the production of work are already included in the Blue Book rate under the hourly Operating Expense costs.
-Indirect costs for small tools not consumed in the production of work are not reimbursable under MDOT force account procedures.   [https://www.acquisition.gov/content/part-31-contract-cost-principles-and-procedures Click here for more information on indirect costs]
+Indirect costs for small tools not consumed in the production of work are not reimbursable under MDOT force account procedures.  CFR 48, Part 31 Federal Accounting Regulations defines materials as those supplies or materials that enter directly into the end product, or that are used or consumed directly in connection with the furnishing of the end product or service.   Part 31 also stipulates that costs for supplies or tools required to perform the work, but not consumed in the production of the work, are considered indirect costs.  Indirect costs for small tools required to perform the work, but that are not consumed or can be used on other projects shall be allocated into the contractor's overhead and costs spread over multiple projects per the contractor’s general accounting/depreciation procedures.  Compensation for indirect costs on MDOT force account work is included in the MDOT labor markup percentage for overhead costs. [https://www.acquisition.gov/content/part-31-contract-cost-principles-and-procedures Click here for more information on indirect costs]
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 =====[[#Equipment Transportation|Equipment Transportation]]=====
 Travel time to the location of the force account work will be included when the equipment is moved under its own power.  When equipment is moved from one site to another by means other than its own power, the actual operating time during periods of loading and unloading equipment will be paid for at the established base hourly rate and transportation costs will be allowed.

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 =====[[#Small Tools|Small Tools]]=====
 No payment will be allowed for small hand and power tools that are not listed in the Blue Book or are listed at a rate of less than $1.00 per hour.
-When small tools or equipment are used on a project and where it may be difficult or unreasonable to establish the age, the engineer and contractor will agree on an age to apply to all small tools or equipment (e.g., air hose, pump hose, cut-off saws, jack-hammer, etc.).
+Indirect costs for small tools not consumed in the production of work are not reimbursable under MDOT force account procedures.   [https://www.acquisition.gov/content/part-31-contract-cost-principles-and-procedures Click here for more information on indirect costs]
-Consumable supplies (welding rod, welding gas, gasoline, diesel, etc.) will be considered incidental and will not be reimbursed separately.
+'''Indirect Costs for Small Tools'''<br />
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 *Foreman exempt from prevailing wage requirements will receive the hourly rate agreed to in the work plan which must be confirmed by the submission of certified payrolls.
 *Prevailing wage covered workers will receive the rate of wage (or scale) shown in the project wage determination or a higher rate as confirmed by the submission of certified payroll.
-*The contractor will receive the amount paid to, or on behalf of workers for bona fide fringe benefits.  This includes benefits required by a collective bargaining agreement or other employment contract generally applicable to prevailing wage covered workers and common to the construction industry. (NOTE:  Generally vacation/holiday pay is considered taxable income; therefore, it should be included with the base labor rate to which 35 percent is added.)
+*The contractor will receive the amount paid to, or on behalf of workers for bona fide fringe benefits.  This includes benefits required by a collective bargaining agreement or other employment contract generally applicable to prevailing wage covered workers and common to the construction industry. (NOTE:  Generally vacation/holiday pay is considered taxable income; therefore, it should be included with the base labor rate to which the applicable mark-up percent is added.)
 *Name, class, dates, and number of hours worked must be listed on form 1101.  A job title cannot be used in lieu of an employee’s actual name for purposes of verification with certified payrolls.
 *The contractor must submit certified payroll for all workers covered by the prevailing wage provisions of the contract as well as any other labor hours for which reimbursement is sought.
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 ====[[#Bond Premium, Insurance and Payroll Taxes|Bond Premium, Insurance and Payroll Taxes]]====
 =====[[#Current|Current]]=====

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 ====[[#Force Account (109.05.D)|Force Account (109.05.D)]]====
-When the previous two methods do not provide an agreement or any time work starts prior to a price being established, then force account procedures shall be used. See [https://mdotwiki.state.mi.us/construction/index.php/109_-_Measurement_and_Payment#FORCE_ACCOUNT_WORK Force Account Work] section for instructions on Force Account Procedures.  The Work Plan and daily reconciliation forms are required any time work commenced prior to price being established.  Furthermore, when work commences under the force account method but is then later negotiated by the engineer and contractor to be a lump sum item of work (pay item 1090003 Negotiated Force Account), the force account records under which work started must still be retained within the project files.
+When the previous two methods do not provide an agreement or any time work starts prior to a price being established, then force account procedures shall be used.  The Work Plan and daily reconciliation forms are required any time work commenced prior to price being established.  Furthermore, when work commences under the force account method but is then later negotiated by the engineer and contractor to be a lump sum item of work (pay item 1090003 Negotiated Force Account), the force account records under which work started must still be retained within the project files.
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