ODOT/APWA Specification Changes

Beginning in 2002, the Oregon Department of Transportation and the Oregon chapter of the American Public Works Association began jointly publishing Oregon Standard Specifications for Construction. The 2002 edition of the document has more than 1000 pages and a maroon cover; it is routinely called "The Maroon Book" in the construction industry. The book governs construction of public works infrastructure projects in Oregon and covers virtually all aspects of such construction, including temporary features and appurtenances, roadwork, drainage, bridges, traffic control, illumination, and materials. Its General Requirements section includes control of the work, quality assurance, legal relations, payment, and dispute resolution.

A new version of the Standard Specifications is scheduled for publication in 2007. Various subcommittees made up of agency and industry personnel have met for over a year assembling recommendations to the steering committee responsible for the 2007 edition. Following are some of the changes that are being recommended to the steering committee by the legal subcommittee¹ regarding general requirements.

Local Agency Use: Standard Specifications is designed to be used by most public agencies in Oregon — including ODOT, with its large highway contracts — and cities, counties, and small agencies, with their more modest local improvement and new construction projects. Inevitably, there are differences of opinion and philosophy between ODOT and the local public agencies regarding contracting processes. For example, many local public agencies desire broad warranty language to ensure that project costs will not overrun and that the contractor will fix any problems that might come up. On the other hand, ODOT prefers to pay for only those things that actually change or go wrong, believing that this philosophy applied to many projects results in lower overall project cost. On a basic level, one philosophy desires certainty and "fixed price," while the other works with controlled uncertainty and a variable price ultimately reflecting actual quantities and changes. In order to make the Standard Specifications usable for public contracting throughout the state, a number of sections are identified as ODOT provisions and requirements, reflecting practices and procedures unique to the larger projects and federal aid processes affecting only ODOT. Additions, deletions, and changes to specific language are allowed and expected. In addition, broad warranty language is generally not included in the Standard Specifications, although local public agencies may well add such language as special provisions in their bid packages.

Time and Scheduling: The calendar day is established as the basis for scheduling. Some definitions have been fine-tuned to avoid confusion regarding commencement and completion of contract time. Scheduling requirements are tightened in an effort to ensure that modern scheduling techniques are used and an appropriate schedule usable for monitoring and control is available to contractor and owner.

Units of Measure: Reversing a ten-year trend, the metric system has been eliminated from the Standard Specifications. United States standard units of measure units are used.

Third-Party References: Wholesale replication of Oregon statutes and administrative rules has largely been deleted, with references to those requirements substituted. But required language covering new requirements (such as the "BOLI bond" and steel price escalation clauses) have been added. In addition, some technical specifications will be moved to special sections. Matters of measurement and payment will remain in the general requirements.

Design-Build: Standard Specifications is generally suitable for design-bid-build projects. Design-build projects will continue to have their own tailored specifications. But some clarification of the role of the agency in design-related aspects of the work has been included. For example, if a contractor makes a cost reduction (or "value engineering") proposal that involves a redesign, then the contractor's design professional becomes responsible not only for the design but also for the inspection of the contractor's work to ensure compliance with that design.

Changes and Claims: Virtually all the fundamentals of public works construction — the agency's right to make unilateral changes in the work, the parties' ability to adjust prices for differing site conditions, final quantity surveys superseding estimated quantity payments, etc. — remain part of the Standard Specifications. But the requirements for claim submittals will be significantly changed. The new Standard Specifications will include strict claim submittal format requirements and a waiver of theories of entitlement not raised early in the process. In addition, differentiation between contractor requests for additional "time" and additional "time and money" in the dispute resolution process have been tightened. If the contractor does not request both time and money at the earliest notice milestone, the agency will treat it as a request for time only, which may lead to decisions by the agency that are not subject to appeal.

Hundreds of hours of subcommittee time have gone into the recommendations to the steering committee for changes to the general requirements of the Standard Specifications. Discussion between representatives of ODOT, various local public agencies, and industry representatives has resulted in few wholesale changes but some fine-tuning to reflect modern industry practices and the needs and expectations of the end-users. A more consistent specification, allowing for modification to fit local needs, with more rigorous scheduling and dispute resolution processes, is likely to result.

¹Mr. Schrader is a member of the legal subcommittee, responsible for making recommendations to the steering committee, which is assembling the final version of ODOT/APWA Oregon Standard Specifications for Construction.

This article is intended to inform the reader of general legal principles applicable to the subject area. It is not intended to provide legal advice regarding specific problems or circumstances. Readers should consult with competent counsel with regard to specific situations.

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