Section 5, “Control of Work,” of the Standard Specifications, details how contract work will be controlled. The proper performance of the contractor and resident engineer assure control.
Verify that the contractor provides quality control over the work. During the manufacture of products and the execution of the project, the contractor performs the actions necessary to assess and adjust production and construction processes to control the level of quality produced in the end product or facility, and to fulfill specified requirements.
The California Department of Transportation (Caltrans) performs activities required for acceptance. The resident engineer and authorized representatives sample, test, and inspect the work to determine if the quality characteristics meet the contract requirements within the tolerances specified. When tolerances are not specified, use judgment to determine if any deviation is allowed consistent with the trades involved.
For additional information on quality control and Caltrans acceptance, refer to Section 3-607, “Quality Assurance,” of this manual.
Section 5-1.01, “General,” of the Standard Specifications, requires the contractor to provide safe and unrestricted access to the work for inspection by Caltrans. The resident engineer must take full advantage of this access.
The Department of Industrial Relations, Division of Occupational Safety and Health (Cal/OSHA) establishes standards for safe access to work, and Caltrans enforces them under Section 7-1.02K(6), “Occupational Safety and Health Standards,” of the Standard Specifications.
The cost of providing access for inspection of bid item work is included in the bid item price. If the contractor is required to construct facilities specifically to provide access for inspection of extra work, the cost may be included on change order bills. These costs, however, are limited to only the increased cost of providing inspection for the extra work and may not include the access costs that fall under the original item work.
Never operate the contractor’s equipment or allow any Caltrans representatives to operate the contractor’s equipment. During quality assurance inspections, only the contractor’s own equipment operators must operate the equipment.
The term “engineer” refers to the resident engineer and authorized representatives. The engineer is responsible for contract administration and is authorized to make the final decision on questions regarding the contract. The engineer must act in accordance with Caltrans policies and procedures and, in the absence of written policy or procedures, must exercise judgment within their ability and span of control as established by the district.
The engineer will focus on the details and methods of performing the work only if one or more of the following conditions exist:
Otherwise, the details and methods must be left to the contractor’s discretion.
Resident engineers must report their assignments to all interested parties by submitting Form CEM-0101, “Resident Engineer’s Report of Assignment.” Submit this form as early as possible.
The resident engineer is the lead for contact and correspondence with the contractor.
Section 5-1.06, “Protests,” of the Standard Specifications allows the contractor to protest an engineer’s decision by submitting a request for information. Protests by the contractor of weekly statements of working days, change orders, or failure to issue a change order must be done through a request for information.
Partnering allows all parties and stakeholders to establish and maintain cooperative communication channels and mutually resolve conflicts at the lowest responsible level. Become familiar with and follow Section 5-1.09, “Partnering,” of the Standard Specifications and the Caltrans publication, Field Guide to Partnering on Caltrans Construction Projects. This publication is available under Resources/Manuals at:
For additional guidance, contact the partnering coordinator in either the district or the Division of Construction. The names and contact numbers for these coordinators are available under Contacts on the Caltrans link at:
Supplemental funds to cover the anticipated partnering costs are included in projects with an engineer’s estimate of more than $1 million. To pay for Caltrans’ share of the partnering costs, execute a change order using the change order code AUZZ.
Use of a partnering facilitator is recommended on all projects. Use of a partnering facilitator is required, however, on all projects greater than $10 million and longer than 100 working days. A list of partnering facilitators is available under Contacts at:
When selecting a partnering facilitator:
If the plans or special provisions do not contain a specified sequence of operations, contractors may select their own schedules, provided the planned order of work meets any dates specified for completion and openings of portions of the work to traffic.
Occasionally, the contractor may submit a proposed modification of the specified order of work that will be more satisfactory for the work’s operation. If, in the resident engineer’s opinion, Caltrans will benefit as much or more by adopting the proposed modification as it would under the specified plan, the contractor’s plan may be implemented with a change order requested by the contractor. Caltrans must receive a monetary adjustment if the contractor has any reduced costs from the change. Also, a contractor may benefit if a change is proposed and accepted under a change order for a value engineering change proposal. Refer to Section 3-405, “Value Engineering,” of this manual and Section 4-1.07, “Value Engineering,” of the Standard Specifications.
The resident engineer must recheck the specified plan of operations during the work’s progress. Changes in circumstances may necessitate altering the planned sequence and schedule. Construction in stages is often a part of the contract on major projects, and revised progress schedules may be required as the stages of work develop.
If the contractor submits any of the following contractor action request forms to the resident engineer, the contractor must also include a completed and signed Form STD 204, “Payee Data Record,” as part of the submittal in accordance with Section 5-1.12, “Assignment,” of the Standard Specifications. Submittal of scanned or faxed copies is acceptable.
Carefully review and verify the information in contractor action request submittals. Adhere to the procedures listed in the instructions of Forms CEM-1202A, CEM-1202B, and CEM-1203. For a contractor business name change submitted under Form CEM-1202A, refer to Section 3-704A, “Responsibilities,” of this manual for information regarding validation of insurance bonds and contract bonds.
Contractors can use subcontractors on their projects provided the subcontractor and the prime contractor comply with Section 5-1.13, “Subcontracting,” of the Standard Specifications, and with state and federal laws and regulations. The contractor is required to submit Form CEM‑1201, “Subcontracting Request,” before subcontracted work starts.
When projects use subcontractors, the resident engineer must focus primarily on:
For more information on these subcontracting requirements, refer to Section 8-3, “Disadvantaged Business Enterprises and Disabled Veteran Business Enterprises,” of this manual.
Section 5-1.13, “Subcontracting,” of the Standard Specifications, requires that the prime contractor perform at least 30 percent of work using the contractor’s own organization unless a different percentage is specified in the special provisions. This requirement does not apply if the work is for a building-construction, non-federal-aid contract.
The percentage of work subcontracted is calculated for first-tier subcontractors only. A contractor’s organization includes only workers employed and paid directly by the prime contractor and only equipment owned or rented by the prime contractor, with or without operators.
Discuss unusual subcontracting situations with the construction engineer. If the situation indicates that additional information is necessary but only available through an inspection of the contractor’s records, request a copy of the subcontract agreement from the prime contractor. If a review of the subcontract agreement does not help resolve the situation, discuss the possibility of an audit with Division of Construction’s field coordinator.
The contractor must submit Form CEM-1201, “Subcontracting Request,” stating what percentage and dollar amount of an item will be subcontracted. The resident engineer must verify the amount. Any rational method of estimating the amount will be acceptable; for example:
When an entire item is subcontracted, use the prime contractor’s item bid price as the dollar amount for the form. When a portion of an item is subcontracted, apply the percentage of the bid item subcontracted to the prime contractor’s item bid price as the dollar amount for the form.
To assure that the contractor is not requesting approval for a subcontractor other than those listed in the bid documents, the resident engineer must check the DBE, DVBE, and small business commitment listings and the list of subcontractors. If a discrepancy is noted, advise the contractor and ask for an explanation. The resident engineer must not approve the subcontracting request until the contractor provides an acceptable explanation.
Sections 4100 through 4114 of the Public Contract Code are called the “Subletting and Subcontracting Fair Practices Act” (Fair Practices Act) and apply to Caltrans construction projects. It is designed to prevent prime contractors from “bid shopping” for subcontractors after bids are opened and the low bidder is known.
The Fair Practices Act requires that subcontracted work in excess of one-half of 1 percent, or 0.005 percent, of the contractor’s total bid amount or $10,000, whichever is greater, must be listed in the prime contractor’s bid proposal. When a prime contractor fails to list a subcontractor in its bid, the law requires that the prime contractor must perform the work with its own forces. The prime contractor may not add an unlisted subcontractor by requesting a substitution. Exceptions to this requirement are discussed in Public Contract Code 4107 (c) and Public Contract Code 4109.
For building projects such as a maintenance station or other off-highway project, all subcontracted work in excess of one-half of 1 percent of the contractor’s total bid amount must be listed.
Verify that the listed subcontractor performs the work or that the contractor complies with the substitution procedures in the Fair Practices Act.
To replace a subcontractor listed in the bid documents, the prime contractor must submit a written request based on the reasons identified in Public Contract Code Section 4107, and include the public works contractor registration number of each substituted subcontractor. To assure this requirement is met, verify that the subcontractor’s registration number is valid at the California Department of Industrial Relations’ Public Works Contractor Registration Search website:
When the prime contractor requests a substitution, proceed as follows:
The intent of the substitution hearing is to give both parties the opportunity to explain to the hearing officer why a substitution should or should not occur. Substitution hearings are conducted informally. Normally, the hearing officer is the district Construction deputy director.
The following presents typical examples of some of the more common violations of the Subletting and Subcontracting Fair Practices Act by a prime contractor:
If these or any other violations occur, proceed as follows:
You are in apparent violation of Sections 4100 through 4114, “Subletting and Subcontracting Fair Practices Act,” of the Public Contract Code, for work being performed on item(s) ____ of Caltrans Contract No. ____. You will be assessed a penalty of $____ as provided in Section 4110 of the Public Contract Code.
If you wish to dispute this apparent violation or the assessed penalty, you must request a hearing with Caltrans. You will be given 5 days notice of the time and place of the scheduled hearing in accordance with Section 4110 of the Public Contract Code.
If you do not request a hearing, the penalty will be assessed as a permanent deduction on the next progress pay estimate.
Occasionally, the contractor will list subcontractors that are not required to be listed. In this case, changes require only an updated subcontracting request to identify the new subcontractor. For the process, refer to Section 3-507D, “Procedure for Approval or Acknowledgment of Subcontractors,” of this manual. If the subcontractor is a DBE, DVBE, or small business, refer to Section 8-3, “Disadvantaged Business Enterprises," or Section 8-4, "Disabled Veteran Business Enterprises,” of this manual for additional requirements.
Section 4110 of Public Contract Code requires Caltrans to conduct a hearing for violations of the “Subletting and Subcontracting Fair Practices Act.” The intent of the violation hearing is to determine whether a penalty should be assessed against the prime contractor for the violations. Each party is entitled to present its arguments on the alleged violations. The hearing should follow this process.
The resident engineer has the responsibility of approving subcontractors on federally funded projects and acknowledging subcontractors on state-financed projects. In general, approving or acknowledging subcontractors is necessary for only first-tier subcontractors. The contractor must submit Form CEM-1201, “Subcontracting Request,” to request subcontracting of contract work. When the contract is awarded, the contractor receives a blank Form CEM-1201, “Subcontracting Request.” Provide additional blank forms to the contractor when necessary. The last page of the form contains instructions for completing the form.
Upon receipt of Form CEM-1201, and before approving the contractor’s request, do the following:
Process the requests in the order of the request number, because lines 2 and 6 contain running balances based on the percentage of work required. Follow the form’s instructions to complete the rest of the form.
As required by Section 5-1.16, “Representative,” of the Standard Specifications, contractors, including those in a joint venture, must name in writing one authorized representative and provide the representative’s contact information. Resident engineers must insist that contractors meet this requirement promptly. If the contractor’s representatives from a joint venture disagree with each other, the resident engineer can contractually refuse to work with more than one representative.
Caltrans has a zero-tolerance policy for violence, threats, harassment, intimidation, and abusive conduct in the work environment. Refer to Director’s Policy DP-18, “Workplace Violence Prevention Policy” and Deputy Directive DD-49, “Sexual Harassment Prevention.” These policies also apply to any subcontractor, supplier, manufacturer, fabricator, producer, or employee of a contractor in their work with Caltrans personnel, the public, and others on the project and related work locations. Caltrans may discharge a worker from the project for engaging in any of these acts. Refer to Section 5-1.18, “Workplace Violence and Harassment Prevention,” of the Standard Specifications for more information.
Consult with the Construction engineer concerning acts or conduct involving workplace violence or harassment before removing an individual from the project. The Construction engineer may consult with the deputy district director of Administration, Legal, and deputy district director of Construction when appropriate. When a formal investigation is initiated through the Office of Workplace Violence Prevention or Discrimination Complaint Investigation Unit, the Construction engineer assures that manager and supervisor roles and responsibilities are followed in compliance with existing policies. Timeframes associated with formal investigations of acts, or conduct involving workplace violence or harassment, are generally outside Construction’s influence; however, district, region, or headquarters Construction management may need to be kept informed of the formal investigation’s resolution status. Certain issues may require an interim removal of the individual from the project with a possibility future return, whereas, other issues will require permanent removal without further reconsideration. If possible, discuss the decision to remove a worker with the worker’s supervisor and district management before or as soon as possible after issuing the directive. When providing written notification to the contractor, be sure to distinguish the removal type.
If acts of violence appear to have resulted in an assault, immediately contact the California Highway Patrol or other jurisdictional law enforcement agency for their response.
If necessary, arrange for legal support in resolving disputes related to removal of individuals from the project.
If workplace violence or harassment has occurred, Caltrans may consider termination of the contract. Involve Legal support, district management, and the Construction field coordinator early in such discussions.
If a contractor notifies Caltrans of workplace violence or harassment concerns related to a Caltrans employee or Caltrans’ consultant, assure that Caltrans’ policies and procedures are followed in assessment and resolution of the issue. The Construction engineer will consult with the deputy district director of Administration, Legal, and deputy district director of Construction, before reassignment of a Caltrans employee as an interim measure.
None of these procedures affect the engineer’s authority to direct the immediate removal of a worker from the project. A worker who demonstrates incompetence or acts in a disorderly or improper manner that has potential to harm others, themselves, or property, may be removed immediately from the project site. Refer to Section 5-1.17, “Character of Workers,” of the Standard Specifications for more information. Promptly notify the contractor of a determination to remove a worker from the project. If a worker refuses to leave the project site, contact the California Highway Patrol or other jurisdictional local law enforcement agency in the project area. Certain instances may require the construction activity be suspended because of the worker‘s removal. If work is suspended, assure the contractor’s work is left in a safe and secure manner.
Section 5-1.20, “Coordination with Other Entities,” of the Standard Specifications requires the contractor to coordinate with other contractors or entities at or near the job site and materials sources to avoid delays.
The contractor must possess all required permits, licenses, agreements, and certifications (PLACs) before starting the work covered by them. Verify that the contractor maintains a copy of the required PLACs at the job site.
Unless the PLACs needed to enable the contractor to use a possible local material source or disposal site are included in the information handout, the contractor must obtain them at no cost to Caltrans even if the agreement made between Caltrans and the property owner is included in the information handout.
If the contractor is proposing to use a noncommercial material source or disposal site, verify that the contractor has met the requirements of Sections 5-1.20A, “General,” 5‑1.20B, “Permits, Licenses, Agreements, and Certifications,” and 6-1.03, “Local Materials,” of the Standard Specifications.
Arrange a joint meeting with the contractor and agencies that have jurisdiction over the use of the site to discuss the work and the required documentation to be submitted. This documentation may include permits, environmental studies, grading plans, a Stormwater Pollution Prevention Plan, local material plan, and testing imported soil from noncommercial sources, for example, for lead and pH levels.
The contractor may use the sample agreement in this section or Forms CEM-1904 , “Agreement Between a Contractor Working on State Facilities and a Real Property Owner for Disposing Construction-Related Material on Commercial Zoned Property Owner's Property”, or CEM-1906, “Agreement Between a Contractor Working on State Facilities and a Real Property Owner for Disposing of Construction-Related Material Suitable for Use on Residential Zoned Property.”
Review Section 7-1.02K(6)(j)(iii), "Unregulated Earth Material Containing Lead," of the Standard Specifications and consult with the district aerially deposited lead coordinator concerning lead level of the existing soils onsite, at:
After the contractor and property owner enter into an agreement and obtain all required documentation, the contractor must submit these for approval. After review and verification of the adequacy of the contractor’s submittals, provide written approval to the contractor to use the site. Refer to Examples 3-5.3, “Sample Approval to Acquire Material From Property Owner’s Property Letter,” and 3-5.4, “Sample Approval for Disposal of Material Outside the Highway Right-of-Way Letter,” for approval letter samples.
If Caltrans has already made arrangements designating a disposal or borrow site and entered into an agreement with a private property owner for disposal, removal, or excavation of material, the designated sites may be made available for contractor use as discussed in Section 7-103H, “Disposal, Staging, and Borrow Sites,” of this manual. In accordance with Section 5-1.20B, “Permits, Licenses, Agreements, and Certifications,” of the Standard Specifications, the contractor must comply with the provisions of the Caltrans-owner agreement if the contractor uses the site or the contractor may make a new agreement with the property owner.
When the contractor makes a new agreement with the property owner that revises the terms of the Caltrans-owner agreements, the new agreement supersedes the Caltrans-owner agreement. Review the new agreement to verify that Caltrans is relieved of its obligations under the terms of the original agreement.
Under some agreements, Caltrans will directly pay the owner of the material or disposal site. Payment must be made to the owner and royalties deducted from payments to the contractor. In the case of county-consummated agreements, royalties usually are deducted in a similar way.
Before contract acceptance, Section 5-1.20B(4), “Contractor-Property Owner Agreement,” of the Standard Specifications requires the contractor to submit a document signed by the owner of the site indicating that the contractor has satisfactorily complied with the provisions of the agreement. If the owner is not satisfied, determine what additional work is necessary before recommending acceptance of the contract and advise the contractor accordingly. Do not delay recommending acceptance of the contract if you determine that the contractor has complied with the terms of the agreement.
An agreement between the contractor and a property owner is not required for procuring local material from an established commercial source.
For the disposal of waste material in a commercial landfill or treatment facility, verify the types of wastes accepted and the permit status of the landfill or treatment facility at the California Water Resources Control Board, CalRecycle, and Department of Toxic Substances Control websites:
Alternatively, contact the facility to obtain a copy of the facility’s permit.
MATERIAL ACQUISITION AGREEMENT
Contract No.: ____________________________
County/Route/Mile post: _____________________________
The contractor, ______________________________________________, (Contractor) has entered into Contract No. _______________ (Contract), with the California Department of Transportation (Caltrans), for work that is described as follows: ___________________________________________________________________________________________________________________________________________________________ (Project).
The owner, _________________________________________________, (Owner) of the real property at __________________________________________________________________________________ (for example, address, location, county and parcel number(s), project station(s), offsets, and other property location information) agrees to allow the Contractor to remove from the Owner’s property approximately _____ cubic yards of ______________________, such as soil, aggregate, asphalt grindings, or other material, for use on the Project.
Owner agrees that the Contractor has assumed ownership of the material once it is removed from the property.
Contractor and Owner agree to abide by the requirements of Section 5-1.20, “Coordination with Other Entities,” of the Standard Specifications. The Standard Specifications are available at:
Contractor and Owner agree to obtain and furnish to the Caltrans engineer, all necessary permits, licenses, agreements, and clearances before removing material from the property.
By submission of this agreement to the Caltrans engineer, Contractor and Owner are acknowledging that they have been informed, or otherwise apprised, of all restrictions, laws and permit requirements associated with the transporting and removal of the material from the property and have agreed to abide by the same. These laws include but are not limited to:
For the disposal of materials on a property owner’s property, use the appropriate of Forms CEM-1904, “Agreement Between a Contractor Working on State Facilities and a Real Property Owner for Disposing Construction Related Material on Commercial Zoned Property Owner’s Property,” or CEM-1906, “Agreement Between a Contractor Working on State Facilities and a Real Property Owner for Disposing Construction-Related Material Suitable for Use on Residential Zoned Property.”
Other actions may require signatures from both the contractor and a property owner, or a contractor and Caltrans, such as acquiring material from a property owner’s property or approval to dispose of material outside the highway right-of-way. See Examples 3-5.2 and 3-5.3 in this manual.
Owner and Contractor agree that the material will be excavated, removed, and transported, and the property left in a manner that will not cause injury or harm to any person or property. If an injury or harm does occur to any person or property or if any environmental effects or litigation arise as a result of the excavation, removal, transportation, deposition, or the final form in which the property is left, the Contractor agrees to indemnify, defend, protect, and hold harmless Caltrans in any action in law or equity in accordance with Section 7‑1.05, “Indemnification,” of the Standard Specifications.
Pursuant to Section 5-1.20B(4), "Contractor-Property Owner Agreement,” of the Standard Specifications, Owner acknowledges Contractor will submit this agreement to Caltrans as evidence that the Owner has authorized the use of the property as a material source for the project. Owner acknowledges that the Contractor is not authorized to make any representations or agreements on behalf of Caltrans. Contractor and Owner agree that Caltrans is released from any and all obligations to Owner made by Contractor under this agreement and Caltrans is released from any and all obligations to Owner under any previous agreement made between Caltrans and Owner.
Owner and Contractor acknowledge that they have had the opportunity to receive independent legal advice with respect to the meaning, implications, and advisability of entering into and executing this agreement.
Date: _______________ __________________________________________________________
(Signature of Property Owner)
Date: _______________ __________________________________________________________
(Signature of Contractor’s Authorized Representative)
STATE OF CALIFORNIA—CALIFORNIA STATE TRANSPORTATION AGENCY GAVIN NEWSOM, Governor
DEPARTMENT OF TRANSPORTATION
DIVISION OF CONSTRUCTION
[Resident Engineer’s Address]
[PHONE (Area Code) xxx-xxxx]
[FAX (Area Code) xxx-xxxx]
Date: [ Month dd, yyyy ]
Subject: Approval to Acquire Material From [property owner’s name and address]
Dear [contractor name]:
In accordance with the provisions of Sections 5-1.20, “Coordination With Other Entities,” and 6-1.03, “Local Materials,” of the Standard Specifications, you are authorized to remove [insert number] cubic yards of [type of material] (material) from [property owner name]’s property located at [property address]. According to the submitted agreement, [contractor name] and [property owner] have represented all necessary permits, licenses, agreements and certifications were obtained and submitted before the removal of the material and have released the Department of Transportation (Caltrans) from any obligations resulting from its removal.
Caltrans does not warrant or guarantee that the material is of any particular type or is suitable for any particular purpose.
The agreement also includes [contractor]’s and [property owner]’s promise to hold Caltrans harmless from all claims for injury to persons or damage to property resulting from its removal. The contractor must comply with all parts of the contract including Sections 7-1.06, “Insurance,” and 7-1.05, “Indemnification,” of the Standard Specifications. [Contractor name] must defend, indemnify, and save harmless the state from any and all claims, demands, causes of action, damages, costs, expenses, actual attorneys’ fees, losses or liabilities, in law or in equity arising out of or in connection with [contractor name]’s performance of this contract including acquiring material from [property owner name]’s property.
[Name of resident engineer]
“Provide a safe, sustainable, integrated and efficient transportation system
to enhance California’s economy and livability”
STATE OF CALIFORNIA—CALIFORNIA STATE TRANSPORTATION AGENCY Gavin Newsom, Governor
DEPARTMENT OF TRANSPORTATION
DIVISION OF CONSTRUCTION
[Resident Engineer’s Address]
[PHONE (Area Code) xxx-xxxx]
[FAX (Area Code) xxx-xxxx]
Date: [Month dd, yyyy]
Subject: Approval for Disposal of Material Outside the Highway Right-of-Way
Dear [contractor name]:
In accordance with the provisions of Sections 5-1.20, “Coordination With Other Entities,” of the Standard Specifications, you are authorized to dispose of [insert number] cubic yards of [type of material] (material) to [property owner name]’s property. According to the submitted agreement, [contractor name] and [property owner] have represented all necessary permits, licenses, agreements, and certifications were obtained and submitted before the disposal of the material and have released the Department of Transportation (Caltrans) from any obligations from its disposal.
Caltrans does not warrant or guarantee that the material is of any particular type or is suitable for any particular purpose.
The contractor must comply with all parts of the contract including Sections 7-1.06, “Insurance,” and 7-1.05, “Indemnification,” of the Standard Specifications. [Contractor name] must defend, indemnify, and save harmless the state from any and all claims, demands, causes of action, damages, costs, expenses, actual attorneys’ fees, losses or liabilities, in law or in equity arising out of or in connection with [contractor name]’s performance of this contract including disposing of material on [property owner name]’s property.
[Name of resident engineer]
“Provide a safe, sustainable, integrated and efficient transportation system
to enhance California’s economy and livability”
The contract may require that plans, working drawings, or samples be submitted to the engineer for authorization. Submittals are considered either “action submittals” or “informational submittals.”
Action submittals consist of written and graphic information and samples that require the engineer’s response. The engineer reviews the submittals, makes corrections, or sends the submittals back to the contractor for correction.
Informational submittals consist of written information required to be provided before the affected work can start, but they do not require a response from the engineer.
Caltrans has a procedure for authorizing plan submittals for facilities that were designed by Structure Design. Resident engineers should contact Structure Design regarding falsework, demolition, and shoring for the procedure when structures were designed by Structure Design.
Section 5-1.24, “Construction Surveys,” of the Standard Specifications requires Caltrans to place stakes and marks necessary to permit satisfactory completion of the work. For information on construction surveys, refer to Chapter 12, “Construction Surveys,” of the Caltrans Surveys Manual.
The district Surveys Unit will set the construction marks and stakes when the area is ready and will start setting marks and stakes within 2 business days of receiving the request for construction stakes.
Contractors have the option of constructing projects with automated machine guidance (AMG) using digital terrain model (DTM) and digital design model (DDM) files provided by Caltrans. Resident engineers should notify district Surveys and the project engineer when a contractor elects to use AMG. Resident engineers need to verify with project engineers that changes to terrain affecting earthwork quantities such as soil erosion or recent improvements are reflected in the current electronic design files.
For projects with more than 5,000 cubic yards of earthwork, the following specifications are included in the contract:
Take the following steps before work begins:
Take the following steps during the course of work:
Section 5-1.27, “Records,” of the Standard Specifications requires the contractor to retain project records for at least 3 years after final project payment or resolution of any claims, whichever is later.
These records must be available for inspection, copying, and auditing by state representatives, and must be segregated by work cost categories:
This section also requires the contractor to use the Caltrans internet change order billing system. Provide training within 30 days of a contractor’s request, and help the contractor’s representative establish an account after receiving the training. Refer to Section 5-103E, “Change Order Billing,” of this manual for additional information.
Section 5-1.30, “Noncompliant and Unauthorized Work,” of the Standard Specifications, specifies the contractor’s responsibility for rejected or unauthorized work and for the removal and replacement of material that does not meet specification requirements.
Unauthorized work includes excavation outside planned slopes and below the grading plane. Unless an approved change order authorizes such excavation, do not permit it.
Except for material that is permitted to remain in place under the specifications for “contract compliance” and “operating range,” reject material represented by a test result not meeting the specified requirement.
Make sure the rejected material gets removed and replaced or remedied in some other manner if it is appropriate. When rejected material is remedied, it may remain in place only if the resident engineer gives written approval. In most cases, the approval requires a contractor-requested change order. For example, a change order would be necessary to approve a contractor’s proposal to remedy out-of-specification aggregate base by adding more aggregate to material deposited previously. A change order is necessary in this situation because the remedy requires a change in specifications. However, the resident engineer’s written approval is not required when the remedy is specified, such as the remedy for damaged galvanizing of pipe or guardrail.
For all material used in the work, make the payment in accordance with the specifications. As an alternative to removal and replacement, do not allow noncompliant material to remain in place without contract payment, unless the specifications, in consideration of “operating range” and “contract compliance,” or an approved change order, provide for such action.
Section 5-1.31, “Job Site Appearance,” of the Standard Specifications requires the contractor to keep the job site neat and includes provisions for disposal of debris.
Section 5-1.32, “Areas for Use,” of the Standard Specifications allows the contractor to occupy the highway only for purposes necessary to perform the work unless arrangements are made with Caltrans for temporary storage. The contractor has no right to make use of the property or to allow others to use it when such use is not reasonably necessary to perform the required work. For example, residency trailers must not be placed within the right-of-way, although one trailer may be allowed for yard security purposes if the engineer approves temporary storage within the right-of-way.
Prohibit any use of a Caltrans right-of-way that conflicts with the specified requirements.
When areas for use are specifically described in the contract, verify the contractor is complying with terms of use. For example, where areas for use include bridge locations, the special provisions are to include restrictions, such as limitations on storage material types, permissible physical locations of storage, required access paths, and maintaining drainage system functionality. Review Structure Policy Directive 1-8, “Material Storage Under Bridges,” for additional information.
If a contractor requests the use of the highway for temporary storage or for any unusual or complicated situations, discuss the request with the Construction field coordinator.
The contractor may enter into a rental agreement to use state-owned property outside the right-of-way.
Also, usable property under bridges or viaducts or other property that cannot be sold as excess, but can be leased, is classified as nonoperating right-of-way, also known as “airspace.” Each district involved with the development of such property has established an inventory. The special provisions will normally cover the use, or prohibit the use, of nonoperating right-of-way by the contractor. When the use of an airspace parcel is not part of the contract and a contractor later requests such use, the contractor must negotiate a lease for the parcel. A standard form is used for the lease and calls for payment based on fair market value. No special consideration will be given because the lessee is performing Caltrans work. Also, all normal provisions requiring insurance and parcel protection will be enforced. Additional requirements will be set forth for parcels that include areas beneath bridges pursuant to Structure Policy Directive 1-8, “Material Storage Under Bridges.”
Section 5-1.33, “Equipment,” of the Standard Specifications, requires each piece of equipment to have a number stamped or stenciled on it. The identifying number should further be referenced to the license plate issued for the piece of equipment. The additional reference is especially important in the case of tractor and trailer combinations where the tractor may pull different trailers on separate occasions.
Use the identifying numbers to keep records of working and idle time for both equipment and operators, including, among other items, contract items, extra work, move in and out, and plant erecting. Some items of work will require more detailed records than other items. Determine which items of work need more detailed records and how much detail will be necessary. Detailed records are also required for costs when the quantity of certain contract items runs more than 125 percent or less than 75 percent of the estimated quantity.
Do not instruct the contractor’s employees in equipment operation, because the contractor may interpret suggestions as the resident engineer’s direct orders. Caltrans personnel must also not adjust the contractor’s equipment or ride on equipment other than that designed for personnel transportation or as required to inspect specific features of the work.
The contractor is required to use renewable diesel to fuel their construction equipment when there is a bid item for “Renewable Diesel Report.” Construction equipment subject to Title 13, Section 2449 of Code of Regulations (13 CCR 2449), “General Requirements for In-Use Off-Road Diesel-Fueled Fleets,” must be fueled with renewable diesel. This requirement applies to all prime contractors and subcontractors who perform roadway excavation, except when the subcontracted quantity in roadway excavation is less than 5,000 cubic yards.
Renewable diesel is a biomass-based fuel, which is an alternative fuel to conventional diesel. Renewable diesel and conventional diesel are interchangeable. They both meet the ASTM D975 specification for petroleum diesel. Equipment modification or retrofit is not required before using renewable diesel. Although renewable diesel is produced from similar types of renewable raw materials as biodiesel, it is important to note that renewable diesel and biodiesel are not the same.
Using renewable diesel rather than conventional diesel in construction equipment reduces harmful emissions of particulates smaller than 2.5 millimeters in diameter, nitrogen oxide, and other greenhouse gases.
The contractor must submit Form CEM-1211, “Renewable Diesel Report,” for reporting the usage of renewable diesel quarterly within 10 days after each quarter ends and a final report within 10 days after contract acceptance. The contractor is not required to submit the purchase receipt; however, the resident engineer may request for a copy to verify the type of fuel delivered. The renewable diesel purchase receipt should state the delivered fuel is renewable diesel and its blend is R95 or above. The R95 indicates it is 95 percent or more renewable diesel. The resident engineer must review the submitted report for completeness and return the signed report to the contractor, who then submits the completed form to:
Payment is made for each authorized quarterly and final renewable diesel report. The resident engineer may withhold $5,000 if the contractor fails to submit a renewable diesel report. The withheld money may become permanent if the contractor does not submit any missing reports within 10 days after contract acceptance.
The contractor may request to opt out of the use of renewable diesel when one of two conditions occurs:
The contractor must identify the renewable diesel index prices and conventional diesel index prices to support their request. The conventional diesel and renewable diesel index prices are posted at:
The resident engineer must review the opt-out request to determine whether an opt-out condition occurred. Refer to Table 3-5.1. of this manual for an example on how to review an opt-out request of the use of renewable diesel request. Once a request is authorized, the contractor has the option to stop using renewable diesel for the remaining duration of the project. If an opt-out request is approved, resident engineers must inform the Division of Construction at Renewablediesel@dot.ca.gov regarding the approval of the request.
Month
Conventional Diesel Price Index
Renewable Diesel Price Index
In this example, the preceding table will be used for conventional diesel index prices and renewable diesel index prices.
There are two projects in this example – project A and project B – to demonstrate how to review the two conditions for opting out of the use of renewable diesel.
Given: The contract bid opening date for this project is in February.
Given: Contractor submits an opt out of the use of renewable diesel request in July by providing the renewable diesel average monthly index prices and the conventional diesel average monthly index prices for May and June.
Step 1: Check the month preceding the contract’s bid opening date.
The preceding month is January, in which the conventional diesel index price is $5.155 and the renewable diesel price index price is $5.134. Because the renewable diesel index price is less than the conventional diesel index price, condition 1 applies.
Step 2: Gather the information to check the opt-out condition 1.
In May, the renewable diesel index price is $5.795 and the conventional diesel index price is $5.216.
In June, the renewable diesel index price is $5.759 and the conventional diesel index price is $5.233.
Step 3: Calculate the percentage increase in index prices for May and June.
Percentage Increase in May
= (Renewable diesel index price - Conventional diesel price index)/Conventional diesel index price
= 0.111 or 11.1 percent
Percentage Increase in June
= (Renewable diesel index price - Conventional diesel index price)/Conventional diesel index price
= 0.101 or 10.1 percent
Because 2 consecutive renewable diesel index prices exceed 10 percent more than their corresponding conventional diesel index prices after contract award, the opt-out request may be approved.
Given: The contract bid opening date for this project is in April.
Given: Contractor submits an opt-out of the use of renewable diesel request in October by providing the renewable diesel index prices and the conventional diesel index prices for August and September to support their request.
Step 1: Check the month preceding the contract’s bid opening date.
The preceding month is March, when the conventional diesel index price is $5.234 and the renewable diesel index price is $5.342. Because the renewable diesel index price is greater than the conventional diesel index price, condition 2 applies.
Step 2: Gather the information to check the opt-out condition 2
The contract bid opening date for this project is in April, in which the renewable diesel index price is $5.351.
In August, the renewable diesel index price is $5.892.
In September, the renewable diesel index price is $5.897.
Step 3: Calculate the percentage increase in index prices for August and September from April’s.
Percentage Increase in August from April bid opening.
= (August Renewable diesel index price - April Renewable diesel index price)/April Renewable diesel index price
= 0.101 x 100 percent
Percentage Increase in September from April bid opening
Index = (September Renewable diesel index price - April Renewable diesel index price)/April Renewable diesel index price
= 0.102 x 100 percent
Because two consecutive renewable diesel index prices exceed 10 percent more than the renewable diesel index price for the month of bid opening after contract award, the opt out request may be approved.
Section 5-1.36, “Property and Facility Preservation,” of the Standard Specifications makes the contractor responsible for protecting and preserving all property involved in the project, including underground facilities and other facilities that are not openly visible. The resident engineer must be diligent in determining and pointing out the existence of property Caltrans knows about, especially underground facilities and other facilities that are not openly visible. For information about locating and protecting underground utilities, refer to Section 3-518C, “Nonhighway Facilities,” of this manual.
Verify that the contractor does everything required under the contract to protect and preserve property. The contractor may be required to install temporary safeguards to protect existing facilities. However, the contractor’s responsibility includes only what is necessary to protect against damage by construction activity.
If a facility was not sufficiently protected and it is damaged, the contractor is responsible for replacing it with material of equal or better quality.
Make sure that the contractor does not begin any excavation without first contacting the regional notification center.
The plans and specifications may require that certain trees, shrubs, and other vegetation are preserved. Make sure the contractor is aware of all plant life to be protected.
If any permanent protection is ordered, pay for this work as for any other ordered additional work.
Make sure the contractor’s operations do not interfere with railroad operations. Do not allow the contractor’s operations to encroach on the railroad right-of-way unless it is specifically allowed by the contract. If work is required on or affecting the railroad right-of-way, the railroad requires that a railroad flagger is present.
For any excavations on or affecting railroad property, verify that the contractor submits work plans showing the protection system to be used. The district railroad coordinator is Caltrans’ liaison with the railroad and should submit the work plans to the railroad for approval. The review time for these work plans is 65 days.
Some utilities will be relocated or abandoned to clear the right-of-way before construction of a highway project. A utility relocation resident engineer is assigned to coordinate and inspect utility relocation to clear the right-of-way before construction. The resident engineer assigned to a project assumes the responsibility of the utility relocation resident engineer. Make contact with all of the affected utility owners to facilitate the coordination of the work with the contractor’s activities.
The district Right of Way Unit, acting through the district utility coordinator, is responsible for making changes to “notice to owner” forms and right-of-way agreements. The district Right of Way Unit must also make all decisions about financial liability between Caltrans and the owner for utility work. Send change orders involving utility work to the district utility coordinator for concurrence.
The utility relocation resident engineer must perform the following duties:
Keep records of such meetings, and restate any decisions made through letters to all parties.
Section 5-1.37, “Maintenance and Protection,” of the Standard Specifications requires the contractor to maintain and protect the work until Caltrans has granted maintenance and protection relief or has accepted the contract. This section also requires the contractor to prevent construction equipment that exceeds legal maximum weight limits from operating on completed or existing treated base, pavement, or structures.
If the highway in question is a state highway, Caltrans’ maintenance forces will maintain the part of the existing highway outside of the limits necessary to construct the bid item work. If the highway or highway part in question is under the control of a local authority, either the local authority or Caltrans maintenance forces will maintain the part of the existing highway outside the limits necessary to construct the bid item work in accordance with the maintenance agreement between Caltrans and the local authority.
The maintenance superintendent, and the resident engineer must have a clear understanding of which portions of the highway Caltrans maintenance forces will continue to maintain during the project’s construction. The following guidelines should be used when discussing roadway maintenance:
Except for special conditions described in Section 5-1.37, “Maintenance and Protection,” of the Standard Specifications, all equipment hauling material over roads or streets open to public traffic to, from, or within the project must comply with weight limitations required by the California Vehicle Code Division 15, "Size, Weight, and Load." If the contractor wishes to move equipment that exceeds the size or weight limits, the contractor must provide necessary protective measures and repair any damage resulting from those overloads.
Refer to Bridge Construction Records and Procedures Manual, Vol. 2, when the contractor requests moving or placing overloads on structures.
To enforce weight limitations for overloads hauled over public roads and streets, follow the procedure outlined below:
Only in some cases will Caltrans pay to repair damage to completed permanent facilities caused by public traffic. Completed permanent facilities are any features constructed by the contractor that will become a permanent part of the project. Unless specifically provided for, Caltrans will not pay for damage to temporary facilities such as falsework and forms.
The facility need not be 100 percent complete for the contractor to be compensated, but it must be functional. Caltrans must not pay for damage from public traffic to facilities that are not considered functional yet. For example, guardrail posts or guide marker posts or a bridge still supported by falsework would not be considered functional. However, for a concrete barrier that only requires a specified light abrasive blast finish, Caltrans may pay for damage caused by public traffic because the barrier is functional.
Following are guidelines for determining payment for damage by public traffic:
When the contract temporarily routes public traffic closer to the facilities than the traffic will be after completion of the work, the contractor will be relieved of responsibility for damage to the completed permanent facilities caused by public traffic. For example, Caltrans will relieve the contractor of responsibility if damage occurs to a completed guardrail at the edge of the shoulder when the plans or special provisions require public traffic to be temporarily placed on the shoulder to facilitate construction.
The contractor may be relieved from maintaining and protecting certain completed portions or sections of the work under conditions specified in Section 5-1.38, “Maintenance and Protection Relief,” of the Standard Specifications.
Caltrans policy recommends relief for only those portions of the work specifically mentioned in the specifications unless a request for relief fully justifies exceptions.
For completed roadways, the specified length of 0.3 miles is the minimum practical length of completed main roadway on which to recommend relief from maintenance and protection. However, shorter units of completed work, such as on-ramps, off-ramps, frontage roads, or approaches to under-crossings and overcrossings, may also be eligible for maintenance and protection relief.
Do not recommend relief from maintenance and protection on a 0.3-mile section with exceptions within that length unless you provide a valid reason to support the recommendation. Exceptions must be defined in terms of longitudinal sections of highway or certain specified areas. For example, it is unacceptable to recommend maintenance and protection relief for a total project except for the inlet ditch to the right of stations 20+00 to 25+00. It is acceptable to recommend relief for the total project except for stations 15+00 to 27+00, which is the section of highway that could be affected by the uncompleted ditch to the right of stations 20+00 to 25+00.
Completed bridges or other major structures may also receive maintenance and protection relief. For purposes of relief from maintenance and protection, the following describes what constitutes a “bridge or other major structure:”
Maintenance and protection relief excuses the contractor from responsibility for repair of damage from causes other than those resulting from the contractor’s own operations or from the contractor’s negligence. Before recommending a request for maintenance and protection relief, determine that the requested work will not be damaged as a result of incomplete adjoining work. For example, a roadway section may be complete while an upstream culvert remains incomplete. Water flowing past the uncompleted culvert may damage a portion of the requested roadway section.
Before recommending maintenance and protection relief, analyze each situation critically to determine if it qualifies in all respects. Indiscriminate recommendations for relief from maintenance and protection must not jeopardize the project’s proper completion. Once the contractor is relieved from maintaining and protecting a portion of the work, the contractor cannot be required to do more work on it except by agreement or to remedy defective work or materials.
If the engineer has any doubts about the requested area’s eligibility, deny the contractor’s request for relief from maintenance and protection. Inform the contractor in writing so no doubt exists as to the status of the contractor’s request and the nature of uncompleted work. Section 5-1.38, “Maintenance and Protection Relief,” of the Standard Specifications states that the portion of work must have been completed under the contract and to the engineer’s satisfaction before it becomes eligible for maintenance and protection relief.
For landscape projects, consider relief from maintenance and protection requests for non-plant establishment related items of work, such as for fences, curbs, sidewalks, asphalt concrete placed as island paving, and seal coats placed on islands, once the plant establishment period begins. Such items may not have a direct bearing on the success or failure of plant establishment, and it is unreasonable to require the contractor to maintain them. To be consistent with the policy for nonlandscape contracts, this type of relief from maintenance and protection responsibility will be granted for an entire group of items, not item by item. An item that protects the planting or is involved in plant establishment should not be submitted for maintenance and protection relief. This category typically includes planter boxes, sprinkler systems, header boards, or mesh.
Safety roadside rest areas will not be accepted item by item but may be recommended as completed units.
Maintenance and protection relief denotes recognition of completed work. Therefore, the resident engineer must conduct a maintenance review of areas that will be granted maintenance and protection relief. Also, recommendations for this action on work for other public agencies or owners require the concurrence of these agencies and owners. Before recommending relief from maintenance and protection on such portions of the work, complete the procedures outlined in Sections 3-523C, “Work for Other Agencies or Owners,” 5-006C, “90 Percent Review,” and 5-006D, “Final Inspection Review,” of this manual. In the communication recommending relief, include a statement that the agency authorities concur or, in the absence of such concurrence, include justification for relief.
For requests for relief from maintenance and protection, use Form CEM-0501, “Relief from Maintenance.”
During the course of the project, and up to receiving the proposed final estimate, the contractor must submit a contract dispute or protest in the form of a request for information. If the request for information leads to a dispute, the contractor must follow the three-part potential claim process specified in the contract. The three parts of the potential claim process are the initial potential claim record, the supplemental potential claim record, and the full and final potential claim record.
Verify that on all potential claims-related documents, the date and time of receipt, and the name of the person who received it are noted.
Verify that the request for information and potential claim documents are complete and timely. If the information is incomplete, notify the contractor of the deficiencies and request that the contractor resubmit the document with the complete information. If the contractor failed to submit the request for information or potential claim record within the specified time, notify the contractor that the submittal was not timely and state that this failure to comply with the procedure provided for in the contract is a waiver of the potential claim, a waiver of the right to a corresponding claim for the disputed work, and a bar to arbitration.
Some sample dispute response clauses are in Section 3-521E, “Sample Dispute Response Clauses,” of this manual.
The contractor may submit a request for information at any time to clarify contract provisions, notify the resident engineer of a change in condition, or file a protest. The request for information must be in writing and delivered to the resident engineer, in person, by mail, or by email, by the contractor.
Using a request for information, the contractor may protest an approved change order not executed by the contractor, compensation for work specified in the change order, adjustment of contract time, Weekly Statement of Working Days, progress payment, delays, liquidated damages, or any decision by the resident engineer.
Note that not all requests for information will result in a potential claim.
Upon receipt of a request for information used as a protest, however, the resident engineer starts a section in Category 62, “Disputes,” of the project records. Additional information, including related documents and correspondence will be included in this section.
The resident engineer references the contractor’s request for information and must respond in writing within the time specified in the contract. A response should include acknowledgment that the request for information was received and may include the information requested, an invitation for further discussion, a request for clarification, or the anticipated date for a complete response.
The contractor submits a written potential claim record when the contractor believes additional compensation is due in accordance with Section 5-1.43, “Potential Claims and Dispute Resolution,” of the Standard Specifications. Follow the potential claim record process when protested issues and disputes are not resolved.
The contractor provides a unique identification number for each potential claim submitted. For supplemental potential claim records and full and final potential claim records, the contractor must certify each form with reference to California Government Code, Title 2, Sections 12650–12655, “False Claims Actions.”
If a supplemental potential claim record or a full and final potential claim record is received without this certification or is otherwise incomplete or incorrectly filled out, notify the contractor in writing that it was not submitted in accordance with Section 5‑1.43, “Potential Claims and Dispute Resolution,” of the Standard Specifications and that the contractor is allowed 15 days to correct the deficiencies or withdraw the potential claim. If the corrected record is not provided in the required time, notify the contractor in writing that Caltrans will not consider the potential claim. Discuss this latter notification with the construction engineer.
If the nature, circumstances, or basis of the claim differs from the previous potential claim record, reject the record and return it with a letter indicating which component has changed.
The initial potential claim record provides a notification to Caltrans of a disputed issue. This record provides the nature and circumstances of the dispute and gives the parties the opportunity to mitigate the associated costs with the goal of an early resolution.
When the contractor’s initial potential claim record is not timely, Caltrans may be disadvantaged by limiting available corrective actions. The timeliness of the original initial potential claim record is one of the many considerations in evaluating a contractor’s protest, especially when quantifying the contractor’s damages and compensation requests.
The resident engineer’s response to the initial potential claim record acknowledges the dispute, directs the contractor on how to proceed with the disputed issue, and informs the contractor of the contractual time requirements to submit the supplemental and full and final potential claim records.
The resident engineer must determine if the contractor’s dispute has merit. If the dispute does have merit, the resident engineer must take appropriate action within the scope of the contract and within the resident engineer’s authority to resolve the dispute. If the resident engineer cannot resolve the dispute or lacks the authority to act, the resident engineer should discuss the issue with the construction engineer and the structure construction engineer, if appropriate.
The supplemental potential claim record provides justification for additional compensation and adjustments with references to the appropriate provisions of the contract. The record must also include the estimated costs and effects to the schedule. The contractor must update the cost estimate or the effect to the schedule as soon as a change is recognized.
Upon receipt of Form CEM-6201E, “Supplemental Potential Claim Record,” analyze the contractor’s potential claim. This may involve discussing the potential claim with peers, subject matter experts, and district management.
Potential claims involving differing site conditions that lack merit must also include an internal review by a management review committee as referenced in Section 3-404, “Differing Site Conditions,” of this manual.
Make sure the supplemental potential claim record is timely and is submitted on Form CEM-6201E, “Supplemental Potential Claim Record.”
Once you receive a complete potential claim record submittal, evaluate it and provide a detailed response letter to the contractor within the time specified in the contract. The response letter must include the following sections:
When properly prepared, the response letter serves as the basis for the preliminary construction claim findings.
Follow the guidelines in Section 3-521D, “Documentation Guidelines for Disputes,” in this manual.
Upon receipt of Form CEM-6201F, “Full and Final Potential Claim Record,” evaluate it and respond within the time specified in the contract. Do not respond to the contractor if the full and final potential claim record is submitted after contract acceptance. Review and consider the information before processing the proposed final estimate.
The requirements and format for the resident engineer’s response to the full and final potential claim record are the same as outlined in Section 3-521C (2a), “Resident Engineer’s Response to the Supplemental Potential Claim Record.” Refer also to Section 3-521D, “Documentation Guidelines for Disputes,” in this section.
The following are guidelines for keeping records and responding to requests for information and potential claim records:
Category 62, “Disputes,” of the project records must contain copies of all documents related to every dispute on the project including progress schedules. This information provides the basis for preparing the preliminary construction claim findings. Follow the procedures outlined in Section 5-102, “Organization of Project Documents,” of this manual to provide a good basis for documenting claims.
Use the following sample clauses in responses to requests for information and potential claim records. Edit the clauses to fit the specific situation.
“I have received your request for information dated [insert date] providing notification of a possible differing site condition encountered at [give location]. It is my understanding that you believe the material encountered differs materially from that shown on the plans or is considered to be of an unusual nature . . .”
“I have investigated the material and the contract documents [specify which documents], and have found that the material does not vary from that shown on the contract documents. Therefore, no additional cost or extension of contract time is warranted to complete the work.
“If you still believe a differing site condition exists, follow the procedures and processes described in Sections 5-1.42, ‘Requests for Information,’ and 5-1.43, ‘Potential Claims and Dispute Resolution,’ of the Standard Specifications.”
“I have investigated the material and the contract documents [specify which documents], and have found that the material does vary from that shown on the contract documents. Therefore, additional cost or extension of contract time may be warranted to complete the work.
“Please furnish me with the additional costs that may result from the increased work as a result of this differing site condition.”
“I have investigated the material and the contract documents [specify which documents], and have found that the material from [specify locations or stations] does not vary from that shown on the contract documents and the material from [specify locations or stations] does vary from that shown on the contract documents. Therefore, additional cost or extension of contract time may be warranted to complete the work from [specify locations or stations].
“Please furnish me with the additional costs for the work from [specify locations or stations] that may result from the increased work as a result of this differing site condition.”
Use the following clauses in your response to a protest of time determination in a change order:
“I have received your request for information dated [insert date] to protest the time adjustment under Change Order No. [x]. I understand that you are protesting the determination of a time extension of [y] working days for this change and you believe you are entitled to a time extension of [z] working days.”
“My review of Change Order No. [x], anticipated work, and the progress schedule indicates that the work required by the change order does not affect the controlling operation [if a critical path method (CPM) review was performed substitute “critical path” for “controlling operation”]. Therefore, you are not entitled to an extension of contract time.
“If you still believe that a time extension is warranted, please provide documentation to support your position, either in narrative form or an analysis showing the effect of this work on the completion date of the project. Continue to follow the procedures and processes described in Sections 5-1.42, ‘Requests for Information,’ and 5-1.43, ‘Potential Claims and Dispute Resolution,’ of the Standard Specifications.”
“My review of Change Order No. [x], anticipated work, and the progress schedule indicates that the work required by the change order affects the controlling operation [if a CPM review was performed, substitute “critical path” for “controlling operation”]. I have determined a time extension of [y] days associated with the work.
“Change Order No. [x] will be revised to reflect this adjustment of contract time. Please review and sign the revised change order if you agree with the change.”
“My review of Change Order No. [x], anticipated work, and the progress schedule indicates that the work required by the change order does not alter the controlling operation [if a CPM review was performed substitute “critical path” for “controlling operation”] as you have indicated. My review indicates that the timeline for the controlling operation [if a CPM review was performed substitute “critical path” for “controlling operation”] was lengthened by [number of days or dates]. Therefore, you are entitled to an extension of contract time by [y] days. Change Order No. [x] will be issued to provide an adjustment of contract time for [number of days or dates].
“If you still believe that an additional time extension is warranted, please provide documentation to support your position, either in narrative form or an analysis showing the effect of this work on the completion date of the project. Continue to follow the procedures and processes described in Sections 5-1.42, ‘Requests for Information,’ and 5-1.43, ‘Potential Claims and Dispute Resolution,’ of the Standard Specifications.”
Use the following clauses in your response to a request for information to protest the determination of contract time in a Weekly Statement of Working Days:
“I have received your request for information dated [insert date], to protest the Weekly Statement of Working Days No. [x]. It is my understanding that you are protesting the charging of [specify day or days protested] as a working day because [specify the contractor’s reasons for protesting the days in question].”
“The Weekly Statement of Working Days was completed in accordance with Section 8-1.05, ‘Time,’ of the Standard Specifications. Our records indicate that you were working on the controlling operation more than 50 percent of the scheduled work shift in question. This constitutes a working day as defined in Section 1-1.07, ‘Definitions,’ of the Standard Specifications. If you believe that the day(s) in question should be considered nonworking days, please submit documentation in support of your protest. In the absence of such documentation, the Weekly Statement of Working Days No. [x] will remain unchanged.
“If you decide to pursue this as a potential claim, follow the procedures and processes described in Sections 5-1.42, ‘Requests for Information,’ and 5-1.43, ‘Potential Claims and Dispute Resolution,’ of the Standard Specifications.”
“I have reviewed the project records and have determined that [insert date] should be revised to indicate a nonworking day. Attached is the revised weekly statement of working days no. [x].”
“Our records indicate that you were working on the controlling operation for the entire day on [insert dates] but not on [insert dates]. [insert dates] should be revised to indicate a nonworking day. Attached is the revised Weekly Statement of Working Days No. [x].
“The Weekly Statement of Working Days was completed in accordance with Section 8-1.05, ‘Time.’ of the Standard Specifications. Our records indicate that you were working on the controlling operation more than 50 percent of the scheduled work shift in question. This constitutes a working day as defined in Section 1-1.07, ‘Definitions,’ of the Standard Specifications. If you believe that the days in question should be considered nonworking days, please submit documentation in support of your protest. In the absence of such documentation, the revised Weekly Statement of Working Days No. [x] will remain unchanged.
“If you decide to pursue this as a potential claim, follow the procedures and processes described in Sections 5-1.42, ‘Requests for Information,’ and 5-1.43, ‘Potential Claims and Dispute Resolution,’ of the Standard Specifications.”
Use the detailed format and response guidelines in Section 3-521C, “Potential Claim Records,” of this manual in conjunction with the following clauses to respond to a potential claim record. Also, refer to Section 3-521C (1a), “Resident Engineer’s Response to the Initial Potential Claim Record,” 3-521C (2a), “Resident Engineer’s Response to the Supplemental Potential Claim Record,” and 3-521C (3a), “Resident Engineer’s Response to the Full and Final Potential Claim Record,” of this manual.
“I have received your [state initial, supplemental, or full and final] potential claim record dated [insert date], regarding [state the issue]. It is my understanding that this potential claim is the result of a dispute over [state the dispute and give background of the dispute].
“I understand your position to be [quote the contractor’s position as described in the potential claim record].”
“I have reviewed your [state initial, supplemental, or full and final] potential claim and based on the information you provided I find that it has no merit. [Explain why in detail.]
“If you decide to pursue this as a potential claim, follow the procedures and processes described in Sections 5-1.42, ‘Requests for Information,’ and 5-1.43, ‘Potential Claims and Dispute Resolution,’ of the Standard Specifications.”
“I have reviewed your [state initial, supplemental, or full and final] potential claim and based on the information you provided I find that it has merit. [Explain why.] Change Order No. [x] will be issued to address the points that have merit. Please provide me with the cost associated with your notice of potential claim for review and determination of compensation.”
“I have reviewed your [state initial, supplemental, or full and final] potential claim and based on the information you provided I find that the following points have merit: [List points and explain why in detail.] The following points do not: [List points and explain why in detail.]
“If you decide to pursue this as a potential claim, follow the procedures and processes described in Sections 5-1.42, ‘Requests for Information,’ and 5-1.43, ‘Potential Claims and Dispute Resolution,’ of the Standard Specifications. Change Order No. [x] will be issued to address the points that have merit. Please provide me with the cost associated with your notice of potential claim for review and determination of compensation.”
“I have reviewed your [state initial, supplemental, or full and final] potential claim record [or request for information]; however, I am unable to make a determination based on the information you provided. Please provide me with the following information so I can make a determination regarding your potential claim.”
Alternative dispute resolution helps resolve disputes and potential claims, mitigate damages, and maintain project schedules.
The alternative dispute resolution processes are partnering, dispute resolution ladders (DRL), dispute resolution advisor (DRA), and dispute resolution board (DRB). Their use is based on the size and duration of the contract. Refer to the special provisions and Sections 5-1.09, “Partnering,” and 5-1.43E, “Alternative Dispute Resolution,” of the Standard Specifications to determine which alternative dispute resolution process is appropriate for the contract.
In order for the alternative dispute resolution processes to be most effective, they must be set up and used in accordance with the applicable provisions. Set up partnering, the DRL, the DRA, or the DRB as quickly as possible within the time specified to assure timely referral and aid in resolution of dispute issues.
As one of the alternative dispute resolution processes, partnering is used to develop and maintain trust and collaboration among project team members. Using partnering best practices provides a process for the project team to resolve project issues and prevent them from becoming disputes. Refer to Section 5-1.09, “Partnering,” of the Standard Specifications, and Section 3-504, “Partnering,” of this manual for further guidance.
If facilitated dispute resolution is included in the partnering charter for the project and the project team is no longer having a productive dialogue regarding a dispute, discuss with the contractor the use of facilitated dispute resolution as a way to reestablish productive dialogue. Schedule facilitated dispute resolution within the timelines provided in Section 5-1.43E(3)(d), “DRB Traditional Dispute Meeting,” of the Standard Specifications. Partnering-facilitated dispute resolution is not a substitute for any other contract requirement or administrative claims procedure or provision. Refer to Chapter 7, “Resolving Disputes,” of the Field Guide to Partnering on Caltrans Construction Projects for further direction and guidance.
Projects with bids less than $3 million may use the partnering dispute resolution ladder (DRL). The optional DRL process will be included in the special provisions or can be added with a no cost change order.
The DRL is an optional part of the alternative dispute resolution process. If used, the DRL runs concurrently with requests for information and potential claim records. It is not a substitute for any other contract requirement or administrative claims procedure or provision.
The resident engineer and the contractor’s representative may use Form CEM-6209, “Elevation of a Dispute,” to define the dispute before elevating it.
The resident engineer does not pay the contractor’s costs for participating in the DRL process.
A dispute will be advanced up the ladder when an agreement between the parties on a defined level cannot be reached within the time specified. A dispute can be elevated sooner if both representatives on the defined level agree and the representatives at the next higher level concur.
A DRA or a DRB is used on a project with at least 100 working days. A DRA is an experienced neutral party that Caltrans and its contractor use to help resolve disputes on contracts with a total bid of $3 million to $10 million. A DRB is a three-member board of knowledgeable neutral parties that Caltrans and the contractor use to resolve disputes on contracts with a total bid of more than $10 million.
Use of a DRA or DRB allows knowledgeable and experienced board members who are not directly involved with the contract to review and analyze a dispute and provide their recommendations. Although these recommendations are not binding, they are valuable in helping to resolve disputes before disputes become claims. These recommendations become important if the dispute is carried over to arbitration.
Disputes are documented in a potential claim record. They must be referred to the DRA or DRB, and a dispute meeting must be held within the timelines specified. Generally, it is not in Caltrans’ best interest to wait to have a dispute heard. Rarely do disputes get smaller as time passes. Furthermore, memories fade with time, and project personnel often move on. Adhering to the timelines is key to resolving disputes as quickly and as fairly as possible. For DRA and DRB suggested operating procedures and traditional dispute meeting timelines, refer to:
If a contractor is not adhering to the specified timelines for referring a dispute to the DRA or DRB, remind the contractor, in writing, of the contractual requirement to do so. If a contractor indicates a wish to defer having the dispute meeting, a new date can be arranged if the resident engineer agrees to the request. If not, remind the contractor of the contractual requirements regarding the timelines for having a dispute meeting.
The Division of Construction’s alternative dispute resolution (ADR) engineer maintains the DRA and DRB websites and a list of prequalified member candidates.
When contractually required, the parties establish and use the DRA or DRB as part of the administrative dispute resolution and potential claims process. Early establishment of the DRA and DRB is important for resolving disputes as they occur. Delays may affect the ability of the DRA or DRB to accurately analyze disputes without a baseline reference.
Use the following procedure to select the best candidates from the prequalified lists. Links to the lists can be found under “Dispute Resolution” at the Division of Construction’s internet website.
The Division of Construction field coordinator must approve the candidates nominated by Caltrans and the third DRB candidate. The division field coordinator must also approve candidates not on the Caltrans prequalified list.
Nominating a DRA or DRB candidate not on the prequalified list requires that the candidate has completed training by the Dispute Resolution Board Foundation. In addition, the candidate needs to have a minimum of 10 years of experience in or directly related to public works, heavy-highway construction projects with, or on behalf of, federal, state (particularly Caltrans), or local government agencies. The experience must be any combination of the following:
Require the candidate to submit a candidate application and send the application to the ADR engineer who processes it. A link to the application can be found at the Division of Construction website. If the candidate is approved and agrees, the candidate is added to the prequalified list by the ADR engineer.
Submit the names, disclosure statements, and résumés of the dispute resolution candidates to the contractor at the preconstruction conference, and ask the contractor to do the same. Jointly with the contractor, review the disclosure statements and résumés of the potential DRA or DRB candidates for qualifications and possible conflicts of interest. Jointly select the most qualified candidates as the DRA or DRB members in accordance with the specifications.
Upon selection, promptly notify the DRA or DRB member in writing, with a courtesy copy to the contractor. Notify the candidates not selected that they are no longer under consideration for the project.
The DRA must complete Form CEM-6206, “Dispute Resolution Advisor (DRA) — Establishment Report,” upon establishing the DRA and email it to the resident engineer and to the ADR engineer at ADR.Engineer@dot.ca.gov.
For the DRB, require the first two approved members to nominate the third member and provide the appropriate documentation for the third member’s approval. Once there is approval of all three members, the DRB chair must complete Form CEM-6202, “Dispute Resolution Board (DRB) — Establishment Report,” upon establishing the DRB and email it to the resident engineer and the ADR engineer at ADR.Engineer@dot.ca.gov.
Sign the DRA or DRB agreement as soon as you have established the members. The Dispute Resolution Advisor Agreement and the Dispute Resolution Board Agreement are available through the Division of Construction website.
With 15 days’ notice, a DRA or DRB member may be replaced, or the member may voluntarily resign. Caltrans or the contractor may terminate the service of a member who fails to comply fully with all required employment and financial disclosure conditions of the DRA or DRB membership.
If Caltrans wants to replace the DRA or Caltrans-nominated DRB member, the resident engineer discusses the proposal with district management. If district management concurs, the district submits its recommendation to the Division of Construction’s field coordinator for approval before notifying the advisor or board member and the contractor.
When the need arises, a replacement member is nominated and approved using the appropriate contractual selection process. In the case of a board member, if the previous member was the chair, the new board must agree on a new chair. In the case of an impasse, the two original DRB members may select the chair by blind draw. Caltrans, the contractor, and the DRA or DRB members sign a revised agreement. The replacement process begins immediately upon receiving a notice of termination and is completed within 15 days.
Alternative dispute resolution is for the benefit of both parties to the contract, so either party may refer a dispute to the DRA or DRB.
As a complement to the agreement, the DRA or DRB chair may produce operating procedures with details for conducting meetings. Work with the DRA or DRB and the contractor to reach an equitable agreement on the meeting process for the individual project circumstances. Verify that the operating procedures comply with all the contract requirements and the DRA or DRB agreement before approving them.
For projects with federal funding, notify the Federal Highway Administration (FHWA) representative when an issue is referred to the DRA or DRB. Coordinate with the FHWA representative on full-oversight projects to assure that the agency participates in any related change order. Give the FHWA representative the date of dispute resolution meetings, information regarding the dispute, and the DRA’s or DRB’s recommendation.
The informal meeting is meant for small, uncomplicated disputes. The informal meeting is optional and is meant to reduce the duration and effort needed to hear a dispute. All parties must agree that the informal process is appropriate for resolving the dispute. The informal dispute process parallels the traditional process.
Typically, very little documentation is provided at an informal dispute meeting. The parties generally just tell their story to the DRA or DRB members and await the recommendation, which should come the same day as the meeting. Use of the informal process must not delay the hearing of a dispute using the traditional process.
The traditional dispute meeting must be used for more complex issues or those issues that were not resolved informally. A traditional dispute meeting is mandatory if the contractor wishes to pursue the dispute.
The contractual time period for submitting the position paper and having a dispute meeting is in the specifications and agreements. Remind the contractor of the contractual time period for referring disputes to the DRA or DRB when responding to the supplemental potential claim record.
When a dispute is referred to a DRA or DRB, prepare the position paper for submittal to the contractor and the DRA or DRB in advance of the oral presentation at the meeting. Present an effective position paper, because the recommendation may be introduced in arbitration proceedings. Remember, the purpose of the position paper is to persuade the DRA or DRB that your position complies with the contract.
Use the following format for the position paper:
Submit a draft written position paper to the construction engineer and peers for review and comment in advance of the formal dispute meeting. These internal reviews provide an opportunity to improve the position paper and benefit Caltrans by informing management of dispute issues.
The oral presentation given during the dispute meeting is important to effectively put forward Caltrans’ position. Begin preparing for the presentation well in advance of the dispute meeting. Hold a mock presentation at least a week in advance of the dispute meeting to allow incorporation of comments from attendees. Attendees at the mock presentation should include the resident engineer, construction engineer, structure representative, bridge engineer, and construction field personnel. Other attendees may include technical experts, district construction claims engineer, construction manager, Division of Construction field coordinator, and others with dispute resolution board experience, depending on the size and complexity of the issue under consideration.
The objective of the mock presentation is to further examine the contractor’s position, to review the basis of Caltrans’ determination of no merit, and to rehearse Caltrans’ presentation including potential rebuttal statements. During the mock presentation, it is advisable that an experienced participant, not directly involved in the contract, provides constructive criticism of Caltrans’ position and the rebuttal of the contractor’s position.
Typically, either the resident engineer or structure representative gives the presentation to the DRA or DRB depending on the dispute issue. Other personnel associated with the project may provide additional evidence. Use of experts not associated with the contract is not allowed unless requested by the DRA or DRB. All parties must agree to the use of a technical specialist in advance.
The dispute meeting will follow the procedure outlined in the dispute resolution agreement and any operating procedures agreed to by all of the parties involved.
In addition to the specific dispute meetings, there are mandatory initial and follow up progress meetings. The DRB progress meetings give members the opportunity to gain knowledge of the progress of work. Hold the first meeting at the start of the project. Each progress meeting must include a site visit allowing the DRB members to view construction operations, construction work completed, and areas where construction work must begin before the next meeting. A representative from both the contractor and Caltrans must attend all progress meetings. The minimum frequency of the progress meetings is stated in the Standard Specifications and in the DRB agreement; however, the frequency of meetings may be increased if the work is proceeding quickly. The agenda of a typical progress meeting is contained within the DRB agreement. At a minimum, the agenda should include a discussion of the following:
Promptly prepare and circulate progress meeting minutes to the parties for revision and approval.
Upon receiving a DRA’s or DRB’s recommendation regarding a dispute, provide a copy to the Division of Construction’s field coordinator and ADR engineer.
Discuss the recommendation with the construction engineer and begin preparing the Caltrans response once the DRA or DRB issues its recommendation to the parties.
Although the recommendation is nonbinding, the parties must respond to the DRA or DRB and the other party within the time specified so it is clear if the dispute is resolved or remains unresolved. Accept or reject a recommendation in accordance with the following:
The DRA must complete Sections 1 through 5 of Form CEM-6207, “Dispute Resolution Advisor (DRA)—Dispute Meeting Report,” within 15 days of the dispute meeting and email it to the resident engineer and the ADR engineer at ADR.Engineer@dot.ca.gov. The resident engineer must complete Section 6 of this form and email to ADR.Engineer@dot.ca.gov. Section 7 is for DRA and resident engineer's comments.
The DRB chair must complete Sections 1 through 5 of Form CEM-6204, “Dispute Resolution Board (DRB)—Dispute Meeting Report,” within 35 days of the dispute meeting and email it to the resident engineer and the ADR engineer at ADR.Engineer@dot.ca.gov. The resident engineer must complete Section 6 of this form and email to ADR.Engineer@dot.ca.gov. Section 7 is for DRB chair and resident engineer's comments and to notify the Division of Construction’s ADR engineer of each party’s acceptance or rejection of the recommendation.
A request for clarification of the recommendation will only be considered if made within the time specified in the contract. Any request for clarification of a DRA or DRB recommendation needs to be discussed with the Division of Construction’s field coordinator before its submittal. Requests for clarification are warranted when the recommendation fails to thoroughly explain the rationale for the recommendation, when the DRA or DRB has not stated Caltrans’ position accurately, or when the contractual provisions have been disregarded.
A request for reconsideration of an issue may be made, and will only be considered, if new evidence concerning the dispute is provided and the request is made within the time specified. Reconsideration requests must be discussed with the Division of Construction’s field coordinator before submittal.
As a project’s completion approaches, schedule appropriate reviews with maintenance, traffic, and safety personnel. Before the final inspection, give the contractor a written list of items needing attention.
To resolve any potential problems on interstate projects, request that a field engineer from the FHWA review the project before the day of final inspection. The objective is to prevent last-minute delays in contract acceptance.
In accordance with Section 5-1.46, “Final Inspection and Contract Acceptance,” of the Standard Specifications, the resident engineer must do a final inspection of the contract work.
Maintain a record of the final inspection in the resident engineer’s daily report. The record should include a statement similar to the following:
“I made a final inspection of the project today and determined that all contract work has been completed.”
“[Name] made the final inspection today and agreed that all contract work has been completed.”
Time the final inspection so that the recommendation for contract acceptance will not be delayed pending the inspection.
On the day project work is completed in accordance with the requirements of the Standard Specifications, special provisions, plans, and approved change orders, notify the district Construction office recommending district acceptance of the contract. Refer to Section 5-1.46, “Final Inspection and Contract Acceptance,” of the Standard Specifications.
For recommendations of acceptance, use Form CEM-6301, “Contract Acceptance.” Once this form has been approved by the deputy district director on behalf of the director, provide a copy of the completed form to the contractor. The contract acceptance recommendation, approval and notification process should be completed within 2 business days. Follow the same procedure for accepting emergency contracts.
As a courtesy, when any work performed under the contract is for other agencies or owners, ask for the concurrence of these entities in the acceptability of the work. Include the concurrence of others such as local agencies, other state agencies, utility companies, and school districts.
Also, ask for concurrence from another party or agency if it finances a state highway project or a portion of the project. The district must arrange a joint field inspection with the owner or agency. In writing and in advance, usually 30 days, notify the owner or agency when the facility will be ready for final inspection. Time the inspection so that concurrence for acceptance is available at the time of recommending the acceptance of the contract or relief from maintenance and protection to the director. However, do not withhold recommendations for acceptance or relief merely because an outside agency will not concur.
The letter notifying the owner or agency of readiness for inspection should include:
If the size or complexity of the work warrants such an action, the resident engineer and an agency representative should make a preliminary joint inspection to correct minor deficiencies before the final inspection described above.
Write a record of the preliminary and final joint field inspections. Note what actions were necessary to complete the work to the agency representative’s satisfaction. Record if the agency representative is satisfied with the completeness of the work but declines to concur in writing.
For State Highway Operation and Protection Program (SHOPP) major projects, complete an asset delivery report using Form CEM-6305, “Asset Tracking at Contract Acceptance.” A copy of the form should be in the resident engineer pending file with prepopulated assets at contract award, but is also available from Asset Management's Asset Tracking Guidance and Form at Construction Completion (CCA) intranet page.
This form tracks originally scoped project assets through project delivery. Changes in scoped assets are to be captured so they can be properly reported and managed. Retain a copy of the completed form in the project records and transmit copies to the project manager and the district’s asset manager.
The contractor must perform corrective work because of a substantial defect as part of the guarantee if all of the following can be demonstrated:
If the resident engineer cannot demonstrate the substantial defect is the responsibility of the contractor, the corrective work cannot be completed as part of the contract.
If a substantial defect is identified, the resident engineer will discuss the substantial defect with district management and the Division of Construction field coordinator. Send a letter to the contractor describing the substantial defect to be remedied. Any correspondence with the contractor regarding corrective work and the substantial defect must include the following language:
“Your refusal may result in a review of your responsibility to perform future work with Caltrans.”
The contractor can perform corrective work without obtaining an encroachment permit.
The contractor may dispute the need for the corrective work but is nevertheless contractually bound to perform the necessary repairs. If the proposed final estimate has not been issued, the contractor can file an exception in response to the proposed final estimate once it is issued. Otherwise, the contractor must file for arbitration pursuant to Section 10240.1 of the Public Contract Code. The contractor has 90 days from the completion of the corrective work or the end of the guarantee period, whichever is later, to file for arbitration.
The end of the guarantee period is 1 year from contract acceptance and will not be suspended or extended based on any corrective work being required or performed.
If the contractor refuses to perform the corrective work or if the corrective work requires an immediate response, Caltrans will perform the corrective work. The district may complete the corrective work with its own forces, day labor, by informal contract or by director’s order. Discuss this process with district management and the Division of Construction field coordinator.
The contractor is liable to the state for the costs to Caltrans resulting from the contractor’s failure to complete the corrective work. The resident engineer will need to maintain records on corrective work expenditures to expedite billing.
The resident engineer will send the detailed billing to the Division of Accounting, abatements section, with instructions to prepare the accounts receivable bill and to mail it to the contractor. If the contractor is not available, the bill should be mailed to the surety.