4338 PRICING CONSTRUCTION CONTRACTS

4338.1 The CCO shall use firm-fixed-price contracts to procure construction.

4338.2 A contract may be priced on a lump-sum basis (when a lump sum is paid for the total work or defined parts of the work), on a unit-price basis (when a unit price is paid for a specified quantity of work units), or a combination of both methods.

4338.3 The CCO shall use lump-sum pricing in preference to unit pricing except when any one (1) of the following circumstances exist:

(a) Large quantities of work (such as excavation, grading, paving, building outside utilities, or site preparation) are involved which cannot be estimated with sufficient confidence to permit a lump-sum offer without a substantial contingency;

(b) Estimated quantities of work required may change significantly during construction; or

(c) Bidders would have to expend unusual effort to develop adequate estimates.

4338.4 The CCO may not use fixed-price contracts with economic price adjustments when an economic price adjustment provision would preclude a significant number of firms from submitting bids or would result in bidders including unwarranted contingencies in proposed prices.

SOURCE: Final Rulemaking published at 55 DCR 493 (January 18, 2008).