OMB Control Number: 2900-0422
Annual Burden Hour: 2,974
852.232-70 Payments Under Fixed-Price Construction Contracts (Without NAS-CPM).
As prescribed in 832.111-70, insert the following clause in contracts that do not contain a section entitled “Network Analysis System—Critical Path”
Payments Under Fixed-Price Construction Contracts (Without NAS-CPM) (NOV 2018)
The clause FAR 52.232-5, Payments Under Fixed-Price Construction Contracts, is implemented as follows:
(a) Retainage. (1) The Contracting Officer may retain funds—
(i) Where performance under the contract has been determined to be deficient or the Contractor has performed in an unsatisfactory manner in the past; or
(ii) As the contract nears completion, to ensure that deficiencies will be corrected and that completion is timely.
(2) Examples of deficient performance justifying a retention of funds include, but are not restricted to, the following—
(i) Unsatisfactory progress as determined by the Contracting Officer;
(ii) Failure to meet schedule in Schedule of Work Progress;
(iii) Failure to present submittals in a timely manner; or
(iv) Failure to comply in good faith with approved subcontracting plans, certifications, or contract requirements.
(3) Any level of retention shall not exceed 10 percent either where there is determined to be unsatisfactory performance, or when the retainage is to ensure satisfactory completion. Retained amounts shall be paid promptly upon completion of all contract requirements, but nothing contained in this paragraph (a)(3) shall be construed as limiting the Contracting Officer's right to withhold funds under other provisions of the contract or in accordance with the general law and regulations regarding the administration of Government contracts.
(b) The Contractor shall submit a schedule of cost to the Contracting Officer for approval within 30 calendar days after date of receipt of notice to proceed. Such schedule will be signed and submitted in triplicate. The approved cost schedule will be one of the bases for determining progress payments to the Contractor for work completed. This schedule shall show cost by the work activity/event for each building or unit of the contract, as instructed by the resident engineer.
(1) The work activities/events shall be subdivided into as many sub-activities/events as are necessary to cover all component parts of the contract work.
(2) Costs as shown on this schedule must be true costs and the resident engineer may require the Contractor to submit the original estimate sheets or other information to substantiate the detailed makeup of the schedule.
(3) The sums of the sub-activities/events, as applied to each work activity/event, shall equal the total cost of such work activity/event. The total cost of all work activities/events shall equal the contract price.
(4) Insurance and similar items shall be prorated and included in the cost of each branch of the work.
(5) The cost schedule shall include separate cost information for the systems listed in the table in this paragraph (b)(5). The percentages listed in the following table are proportions of the cost listed in the Contractor's cost schedule and identify, for payment purposes, the value of the work to adjust, correct and test systems after the material has been installed. Payment of the listed percentages will be made only after the Contractor has demonstrated that each of the systems is substantially complete and operates as required by the contract.
Value of Adjusting, Correcting, and Testing System
System |
Percent |
Pneumatic tube system |
10 |
Incinerators (medical waste and trash) |
5 |
Sewage treatment plant equipment |
5 |
Water treatment plant equipment |
5 |
Washers (dish, cage, glass, etc.) |
5 |
Sterilizing equipment |
5 |
Water distilling equipment |
5 |
Prefab temperature rooms (cold, constant temperature) |
5 |
Entire air-conditioning system (Specified under 600 Sections) |
5 |
Entire boiler plant system (Specified under 700 Sections) |
5 |
General supply conveyors |
10 |
Food service conveyors |
10 |
Pneumatic soiled linen and trash system |
10 |
Elevators and dumbwaiters |
10 |
Materials transport system |
10 |
Engine-generator system |
5 |
Primary switchgear |
5 |
Secondary switchgear |
5 |
Fire alarm system |
5 |
Nurse call system |
5 |
Intercom system |
5 |
Radio system |
5 |
TV (entertainment) system |
5 |
(c) In addition to this cost schedule, the Contractor shall submit such unit costs as may be specifically requested. The unit costs shall be those used by the Contractor in preparing its bid and will not be binding as pertaining to any contract changes.
(d) The Contracting Officer will consider for monthly progress payments material and/or equipment procured by the Contractor and stored on the construction site, as space is available, or at a local approved location off the site, under such terms and conditions as the Contracting Officer approves, including but not limited to the following—
(1) The materials or equipment are in accordance with the contract requirements and/or approved samples and shop drawings;
(2) The materials and/or equipment are approved by the resident engineer;
(3) The materials and/or equipment are stored separately and are readily available for inspection and inventory by the resident engineer;
(4) The materials and/or equipment are protected against weather, theft and other hazards and are not subjected to deterioration; and
(5) The Contractor obtains the concurrence of its surety for off-site storage.
(e) The Government reserves the right to withhold payment until samples, shop drawings, engineer's certificates, additional bonds, payrolls, weekly statements of compliance, proof of title, nondiscrimination compliance reports, or any other requirements of this contract, have been submitted to the satisfaction of the Contracting Officer.
(f) The Contracting Officer will notify the Contractor in writing within 10 calendar-days of exercising retainage against any payment in accordance with FAR clause 52.232-5(e). The notice shall disclose the amount of the retainage in value and percent retained from the payment, and provide explanation for the retainage.
(End of clause)
Alternate I (Nov 2018). If the specifications include guarantee period services, the Contracting Officer shall include the following paragraphs as additions to paragraph (b) of the basic clause:
(6)(i) The Contractor shall at the time of contract award furnish the total cost of the guarantee period services in accordance with specification section(s) covering guarantee period services. The Contractor shall submit, within 15 calendar days of receipt of the notice to proceed, a guarantee period performance program that shall include an itemized accounting of the number of work-hours required to perform the guarantee period service on each piece of equipment. The Contractor shall also submit the established salary costs, including employee fringe benefits, and what the Contractor reasonably expects to pay over the guarantee period, all of which will be subject to the Contracting Officer's approval.
(ii) The cost of the guarantee period service shall be prorated on an annual basis and paid in equal monthly payments by VA during the period of guarantee. In the event the installer does not perform satisfactorily during this period, all payments may be withheld and the Contracting Officer shall inform the Contractor of the unsatisfactory performance, allowing the Contractor 10 days to correct deficiencies and comply with the contract. The guarantee period service is subject to those provisions as set forth in the Payments and Default clauses.
852.232-71 Payments Under Fixed-Price Construction Contracts (Including NAS-CPM).
As prescribed in 832.111-70, insert the following clause in contracts that contain a section entitled “Network Analysis System—Critical Path Method (NAS-CPM).”
Payments Under Fixed-Price Construction Contracts (Including NAS-CPM) (Nov 2018)
The clause FAR 52.232-5, Payments Under Fixed-Price Construction Contracts, is implemented as follows:
(a) Retainage. (1) The Contracting Officer may retain funds—
(i) Where performance under the contract has been determined to be deficient or the Contractor has performed in an unsatisfactory manner in the past; or
(ii) As the contract nears completion, to ensure that deficiencies will be corrected and that completion is timely.
(2) Examples of deficient performance justifying a retention of funds include, but are not restricted to, the following—
(i) Unsatisfactory progress as determined by the Contracting Officer;
(ii) Failure to meet schedule in Schedule of Work Progress;
(iii) Failure to present submittals in a timely manner; or
(iv) Failure to comply in good faith with approved subcontracting plans, certifications, or contract requirements.
(3) Any level of retention shall not exceed 10 percent either where there is determined to be unsatisfactory performance, or when the retainage is to ensure satisfactory completion. Retained amounts shall be paid promptly upon completion of all contract requirements, but nothing contained in this paragraph (a)(3) shall be construed as limiting the Contracting Officer's right to withhold funds under other provisions of the contract or in accordance with the general law and regulations regarding the administration of Government contracts.
(b) The Contractor shall submit a schedule of costs in accordance with the requirements of section “Network Analysis System—Critical Path Method (NAS-CPM)” to the Contracting Officer for approval within 90 calendar days after date of receipt of notice to proceed. The approved cost schedule will be one of the bases for determining progress payments to the Contractor for work completed.
(1) Costs as shown on this schedule must be true costs and the resident engineer may require the Contractor to submit its original estimate sheets or other information to substantiate the detailed makeup of the cost schedule.
(2) The total costs of all work activities/events shall equal the contract price.
(3) Insurance and similar items shall be prorated and included in each work activity/event cost of the critical path method (CPM).
(4) The CPM shall include a separate cost loaded activity for adjusting and testing of the systems listed in the table in paragraph (b)(5) of this clause. The percentages listed in paragraph (b)(5) will be used to determine the cost of adjust and test work activities/events and identify, for payment purposes, the value of the work to adjust, correct and test systems after the material has been installed.
(5) Payment for adjust and test activities will be made only after the Contractor has demonstrated that each of the systems is substantially complete and operates as required by the contract.
Value of Adjusting, Correcting, and Testing System
System |
Percent |
Pneumatic tube system |
10 |
Incinerators (medical waste and trash) |
5 |
Sewage treatment plant equipment |
5 |
Water treatment plant equipment |
5 |
Washers (dish, cage, glass, etc.) |
5 |
Sterilizing equipment |
5 |
Water distilling equipment |
5 |
Prefab temperature rooms (cold, constant temperature) |
5 |
Entire air-conditioning system (Specified under 600 Sections) |
5 |
Entire boiler plant system (Specified under 700 Sections) |
5 |
General supply conveyors |
10 |
Food service conveyors |
10 |
Pneumatic soiled linen and trash system |
10 |
Elevators and dumbwaiters |
10 |
Materials transport system |
10 |
Engine-generator system |
5 |
Primary switchgear |
5 |
Secondary switchgear |
5 |
Fire alarm system |
5 |
Nurse call system |
5 |
Intercom system |
5 |
Radio system |
5 |
TV (entertainment) system |
5 |
(c) In addition to this cost schedule, the Contractor shall submit such unit costs as may be specifically requested. The unit costs shall be those used by the Contractor in preparing its bid and will not be binding as pertaining to any contract changes.
(d) The Contracting Officer will consider for monthly progress payments material and/or equipment procured by the Contractor and stored on the construction site, as space is available, or at a local approved location off the site, under such terms and conditions as the Contracting Officer approves, including but not limited to the following—
(1) The materials or equipment are in accordance with the contract requirements and/or approved samples and shop drawings;
(2) The materials and/or equipment are approved by the resident engineer;
(3) The materials and/or equipment are stored separately and are readily available for inspection and inventory by the resident engineer;
(4) The materials and/or equipment are protected against weather, theft and other hazards and are not subjected to deterioration; and
(5) The Contractor obtains the concurrence of its surety for off-site storage.
(e) The Government reserves the right to withhold payment until samples, shop drawings, engineer's certificates, additional bonds, payrolls, weekly statements of compliance, proof of title, nondiscrimination compliance reports, or any other requirements of this contract, have been submitted to the satisfaction of the Contracting Officer.
(f) The Contracting Officer will notify the Contractor in writing within 10 calendar-days of exercising retainage against any payment in accordance with FAR clause 52.232-5(e). The notice shall disclose the amount of the retainage in value and percent retained from the payment, and provide explanation for the retainage.
(End of clause)
Alternate I (Nov 2018). If the specifications include guarantee period services, the Contracting Officer shall include the following paragraphs as additions to paragraph (b) of the basic clause:
(6)(i) The Contractor shall show on the critical path method (CPM) the total cost of the guarantee period services in accordance with the guarantee period service section(s) of the specifications. This cost shall be priced out when submitting the CPM cost loaded network. The cost submitted shall be subject to the approval of the Contracting Officer. The activity on the CPM shall have money only and not activity time.
(ii) The Contractor shall submit with the CPM a guarantee period performance program which shall include an itemized accounting of the number of work-hours required to perform the guarantee period service on each piece of equipment. The Contractor shall also submit the established salary costs, including employee fringe benefits, and what the Contractor reasonably expects to pay over the guarantee period, all of which will be subject to the Contracting Officer's approval.
(iii) The cost of the guarantee period service shall be prorated on an annual basis and paid in equal monthly payments by VA during the period of guarantee. In the event the installer does not perform satisfactorily during this period, all payments may be withheld and the Contracting Officer shall inform the Contractor of the unsatisfactory performance, allowing the Contractor 10 days to correct and comply with the contract. The guarantee period service is subject to those provisions as set forth in the Payments and Default clauses.
852.236–72 Performance of Work by the Contractor.
As prescribed in 836.501, insert the following clause:
Performance of Work by the Contractor (APR 2019)
(a) In accordance with FAR 52.236–1, the contract work accomplished on the site by laborers, mechanics, and foreman/superintendent on the contractor’s payroll
and under their direct supervision shall be used in establishing the percent of work to be performed by the Contractor. Cost of material and equipment installed by such
labor may be included. The work by the contractor’s executive, administrative and
clerical forces shall be excluded in establishing compliance with the requirements of this clause.
(b) The Contractor shall submit, simultaneously with the schedule of costs required by the Payments under Fixed-Price Construction Contracts clause of the contract, a statement designating the portions of contract work to be performed with the contractor’s own forces. The approved schedule of costs will be used in determining the value of a work activity/event, or portions thereof, of the work for the purpose of this article.
(c) Changes to established activity/event identifiers or responsibility codes for Contractor activities shall not be made without approval from the Contracting
Officer.
(d) In the event the Contractor fails to comply with FAR 52.236–1, Performance of
Work by the Contractor, the Contracting Officer will withhold retention in the amount
of 15% of the value of any work activity/ element being invoiced that was not authorized by the Contracting Officer to be performed by someone other than the prime contractor’s own workforce.
(End of clause)
Alternate I (APR 2019). For requirements which include a Network Analysis System
(NAS), substitute the following paragraph (b) for paragraph (b) of the basic clause:
(b) The Contractor shall submit, simultaneously with the cost per activity of
the construction schedule required by Section 01310 or 01311, NETWORK
ANALYSIS SYSTEM, a responsibility code for all activities of the network for which the contractor’s forces will perform the work. The cost of these activities will be used in determining the portions of the total contract work to be executed by the contractor’s forces for the purpose of this article.
852.236–80 Subcontracts and Work Coordination.
As prescribed in 836.574, insert the following clause:
Subcontracts and Work Coordination (APR 2019)
(a) Nothing contained in this contract shall be construed as creating any contractual
relationship between any subcontractor and the Government. Divisions or sections of specifications are not intended to control the Contractor in dividing work among
subcontractors, or to limit work performed by any trade.
(b) The Contractor shall be responsible to the Government for acts and omissions of
his/her own employees, and of the subcontractors and their employees. The Contractor shall also be responsible for coordination of the work of the trades, subcontractors, and material suppliers.
(c) The Government or its representatives will not undertake to settle any differences between the Contractor and subcontractors or between subcontractors.
(d) The Government reserves the right to refuse to permit employment on the work, or require dismissal from the work, of any subcontractor or subcontractor employee
who, by reason of previous unsatisfactory work on Department of Veterans Affairs
projects or for any other reason, is considered by the Contracting Officer to be incompetent, careless, or otherwise objectionable.
(End of clause)
Alternate I (APR 2019). For new construction work with complex mechanical-electrical
work, the following paragraph relating to work coordination may be substituted for
paragraph (b) of the basic clause:
(b) The Contractor shall be responsible to
the Government for acts and omissions of his/her own employees, and subcontractors and their employees. The Contractor shall also be responsible for coordination of the work of the trades, subcontractors, and material suppliers. The Contractor shall, in advance of the work, prepare coordination drawings showing the location of openings through slabs, the pipe sleeves and hanger inserts, as well as the location and elevation of utility lines, including, but not limited to, conveyor systems, pneumatic tubes, ducts, and conduits and pipes 2 inches and larger
in diameter. These drawings, including plans, elevations, and sections as
appropriate, shall clearly show the manner in which the utilities fit into the available space and relate to each other and to existing building elements. Drawings shall be of appropriate scale to satisfy the previously stated purposes, but not smaller than 32044;8-inch scale. Drawings may be composite (with distinctive colors for the various trades) or may be separate but fully coordinated drawings (such as sepias or photographic paper reproducibles) of the same scale. Separate drawings shall depict identical building areas or sections and shall be capable of being overlaid in any combination. The submitted drawings for a given area of the project shall show the work of all trades that will be involved in that particular area. Six complete composite drawings or six complete sets of separate reproducible drawings shall be received by the Government not less than 20 days prior to the scheduled start of the work in the area illustrated by the drawings, for the purpose of showing the Contractor’s planned methods of installation. The objectives of such drawings are to promote carefully planned work sequence and proper trade coordination, in order to assure the expeditious solutions of problems and the installation of lines and equipment as contemplated by the contract documents while avoiding or minimizing additional costs to the Contractor and to the Government. In the event the Contractor, in coordinating the various installations and in planning the method of installation, finds a conflict in location or elevation of any of the utilities with themselves, with structural items or with other construction items, he/she shall bring this conflict to the attention of the Contracting Officer immediately. In doing so, the Contractor shall explain the proposed method of solving the problem or shall request instructions as to how to proceed if adjustments beyond those of usual
trades’ coordination are necessary. Utilities installation work will not proceed in any area prior to the submission and completion of the Government review of the coordinated drawings for that area, nor in any area in which conflicts are disclosed by the coordination drawings, until the conflicts have been corrected to the satisfaction of the Contracting Officer. It is the responsibility of the Contractor to submit the required drawings in a timely manner consistent with the requirements to complete the work covered by this contract within the prescribed contract time.
852.243–70 Construction Contract Changes—Supplement.
As prescribed in 843.205–70, the Contracting Officer shall insert this clause in solicitations and contracts for construction that are expected to exceed the micro-purchase threshold. The Contracting Officer shall fill in the number of days in which a Contractor must assert its right to an equitable adjustment; however, such amount shall not exceed 60 calendar days.
Construction Contract Changes—Supplement (SEP 2019)
The FAR clauses 52.243–4, Changes; 52.243–5, Changes and Changed Conditions; and 52.236–2, Differing Site Conditions, are supplemented as follows:
(a) Submission of request for equitable adjustment proposals. When directed by the
Contracting Officer or requested by the Contractor, the Contractor shall, in accordance with FAR 15.403–5, submit proposals for changes in the work exceeding $500,000 in writing to the Contracting Officer or Administrative Contracting Officer (ACO), and to the resident engineer.
(1) The Contractor must provide an itemized breakdown for changes exceeding
the micro-purchase threshold (see FAR 2.101).
(2) The itemized breakdown shall include materials, quantities, unit prices, labor costs (separated into trades), construction equipment, etc. Labor costs shall be
identified with specific material placed or operation performed.
(3) Proposals shall be submitted to the Contracting Officer or ACO and the resident
engineer as expeditiously as possible, but not later than [fill-in] calendar days, after
receipt of a written change order by the Contracting Officer.
(4) Proposals shall be signed by each subcontractor participating in the change.
(5) The Contracting Officer will consider issuing a settlement by determination to the
contract if the Contractor’s proposal required by paragraph (3) is not received within 30 calendar days, or if agreement has not been reached.
(b) Paragraphs (a)(1) through (5) and the following apply to proposed contract changes costing $500,000 or less:
(1) As a basis for negotiation, allowances not to exceed 10 percent each for overhead and profit for the party performing the work will be based on the value of labor, material, and equipment required to accomplish the change. As the value of the change increases, a declining scale will be used in negotiating the percentage of overhead and profit. This declining scale will also be used to negotiate the prime Contractor’s or upper-tier subcontractor’s fee when work is performed by lower-tier subcontractors (to a maximum of three tiers) and will be based on the net increased cost to the prime or upper-tier subcontractor, as applicable. Profit (fee) shall be computed by multiplying the profit percentage by the sum of the direct costs and
computed overhead costs. Allowable percentages on changes will not exceed the
following:
(i) 10 percent overhead and/or 10 percent profit (fee) on the first $20,000.
(ii) 7.5 percent overhead and/or 7.5 percent profit (fee) on the next $30,000.
(iii) 5 percent overhead and/or 5 percent profit (fee) on a balance over $50,000.
(2) The Contracting Officer will consider issuing a settlement by determination to the
contract if the Contractor’s proposal required by paragraph (3) is not received within 30 calendar days, or if agreement has not been reached.
(c)(1) Overhead and Contractor’s fee percentages shall be considered to include
insurance other than mentioned herein, field and office supervisors and assistants, security police, use of small tools, incidental job burdens, and general home office expenses and no separate allowance will be made. Assistants to office supervisors include all clerical, stenographic and general office help. Incidental job burdens include, but are not necessarily limited to, office equipment and supplies, temporary toilets, telephone and conformance to OSHA requirements. Items such as, but not necessarily limited to, review and coordination, estimating and expediting relative to contract changes are associated with field and office supervision and are considered to be included in the Contractor’s overhead and/or fee percentage.
(2) Where the Contractor’s or subcontractor’s portion of a change involves credit items, such items must be deducted prior to adding overhead and profit for the
party performing the work. The Contractor’s fee is limited to the net increase to Contractor or subcontractors’ portions of cost computed in accordance with this clause.
(3) Where a change involves credit items only, a proper measure of the amount of
downward adjustment in the contract price is the reasonable cost to the Contractor if it had performed the deleted work. A reasonable allowance for overhead and profit are properly includable as part of the downward adjustment for a deductive change. The amount of such allowance is subject to negotiation.
(End of clause)
| File Type | application/vnd.openxmlformats-officedocument.wordprocessingml.document |
| Author | vacotillma |
| File Modified | 0000-00-00 |
| File Created | 2023-08-01 |