Change Orders
Clean Water Fund Program and Safe Drinking Water Loan Program
A change order is a document that specifies and justifies a change to a construction contract. Typically, a change order alters the time of completion, change in quantities, and/or the total price in a construction contract. A change order is eligible for funding through the Clean Water Fund Program (CWFP) or Safe Drinking Water Loan Program (SDWLP) only if approved by the DNR construction management engineer (CME).
The funding recipient shall promptly submit each change order and all associated backup documentation to the DNR CME and no later than 90 days after execution of the change order, in accordance with ss. NR 162.08(7)(c) and NR 166.11(7)(c), Wis. Adm. Code.
State statutes require the DNR to periodically inspect Environmental Loan projects to determine compliance with the approved plans and specifications as well as other program requirements such as bidding and procurement laws, Davis-Bacon and Related Acts, American Iron and Steel, etc. Determining compliance involves the review and approval of change orders to any contracts for a project.
In situations where the proposed change(s) would substantially alter the capacity or operation of a facility, further review by technical review staff will be required. This may involve re-approval of the original plans and specifications. The DNR strongly encourages the municipality to discuss such potential changes in the project with the department's regional basin/watershed engineer as early as possible to allow adequate time for comment.
Municipality's role
Municipalities, as recipients of financial assistance from the CWFP or SDWLP, are responsible for the negotiation of change orders. During negotiations, the municipality must secure a fair and reasonable price for the required work. When the municipality prepares a change order for department review, it should:
Identify the change order
Include the municipality's name, project name and number, contract name and number, change order date and number and all other appropriate contract information.
Justify the change
Provide sufficient documentation to demonstrate that the municipality made a reasonable analysis of the change.
Submit cost and pricing of the change
Include invoices or quotations from the prime contractor and all subcontractors. Depending on the value of the change, a review of the cost should be conducted. The greater the cost, the more detailed the review should be. Some changes will require an independent estimate. Many will require the engineer to conclude that based upon experience the cost is appropriate.
Contractors overhead and mark-up
The overhead and mark-up will be limited up to 15% for the contractor actually performing the work and up to 5% for each tier of contractor above the original subcontractor who performed the work.
Obtain signatures of all parties to the contract
Obtain signatures of all parties to the contract
Submit the change order to DNR for approval
Mail the printed change order along with supporting documentation to the assigned DNR CME no later than 90 days after execution of the change order. In some instances, scanned documents (less than 25 pages) may be accepted in lieu of printed submittals.
The DNR CME will determine eligibility based on criteria specified in administrative codes, best management practices, ECJC Standard General Conditions of the Construction Contract and the project construction contract documents themselves. Read DNR CME interpretation of EJCDC standard general conditions for change order eligibility.
- Contact information
- For information on this topic, contact:
- DNR Construction Management Engineers (CMEs)