AGC Seeks Federal Agency Change Order Improvements

Requests Data Reporting to Encourage Accountability
At AGC’s urging, the House of Representative’s Small Business Committee requested that the Government Accountability Office (GAO) conduct a review of the use of change orders on federal construction contracts. The review will examine at least one major civilian and one major defense agency with significant volumes of federal construction contracts. This bipartisan request is a direct result of AGC’s efforts with both parties in Congress to address the many issues associated with change orders.
Among the inquiries, the Committee asks GAO to request from the agency:

  • How long does it take, and should it take, for agencies to determine the cost impact of change orders and compensate the contractor?

  • What guidelines do agencies have for issuing and paying for change orders on the prime and subcontract levels?

  • What evidence exists of change order bundling?

  • What is the purpose of agencies engaging in bundling change orders?

  • How does change order bundling affect the ability of a contractor to obtain surety bonds?

  • Is there evidence that agencies otherwise may be acting in bad faith in delaying the settlement of change order requests for equitable adjustment?

AGC has previously called on the Federal Acquisition Regulation Council to improve the data federal agencies collect regarding the administration of change orders in response to the Council’s information request. AGC’s recommendations would require federal agencies to collect a range of data regarding the timeliness of action by the contracting officer (CO) in an effort to encourage greater CO accountability.
For more information, contact Jordan Howard at [email protected] or (703) 837-5368.

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