Development of a formal change order pricing procedure

William H. Lester, Timothy R.B. Taylor, Paul M. Goodrum, Yongwei Shan

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

Abstract

Change orders are an element of highway construction that often pits the state department of transportation (DOT) and contractor against each other in a game of cost risk allocation. Much of the risk is due to the uncertainty of the change order's total cost. Calculating a fair and accurate price can be difficult and time consuming due to different goals of the negotiating parties. This paper examines change order pricing within the Kentucky Transportation Cabinet. Change order cost data from Kentucky Transportation Cabinet projects is used to evaluate the effectiveness of three available historical cost databases; the R. S. Means Heavy Construction Manual, Trnsport Estimator, a commercially available estimating software package, and the Kentucky Transportation Cabinet's Average Unit Bid Price database. A formal change order pricing process is developed using information gathered from interviews with Kentucky Transportation Cabinet field engineers, other state DOT change order pricing practices, and best practices identified in existing literature. This process provides a quick reference tool that can be used by new and experienced field engineers to price change orders and ensure a uniform pricing procedure across the state. The results of the study indicate that Kentucky's Average Unit Bid Price database provides the most consistent change order pricing for state transportation projects and the formal change order pricing process developed here is a potentially useful tool for ensuring uniformity in pricing change orders.

Original languageEnglish
Title of host publicationAnnual Conference of the Canadian Society for Civil Engineering 2011, CSCE 2011
Pages2389-2398
Number of pages10
StatePublished - 2011
EventAnnual Conference of the Canadian Society for Civil Engineering 2011, CSCE 2011 - Ottawa, ON, Canada
Duration: Jun 14 2011Jun 17 2011

Publication series

NameProceedings, Annual Conference - Canadian Society for Civil Engineering
Volume3

Conference

ConferenceAnnual Conference of the Canadian Society for Civil Engineering 2011, CSCE 2011
Country/TerritoryCanada
CityOttawa, ON
Period6/14/116/17/11

ASJC Scopus subject areas

  • General Engineering

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