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Change Order-CCD's


 

 

CCD'S 101  

Current Documents:

* The CCD documents can be found under your project Documents Tool in the CCD folder.

 

Definitions

  • Brinkmann Definition of CCD: Construction Change Directive (CCD): Internal, owner driven or subcontractor costs outside the agreed upon contract scope that will be charged back to the owner in a change order after the construction change directive is approved.
    • A CCD is our way of identifying, tracking, and/or processing a specific change event to the project.  These are essentially owner approvals to proceed with changes that will be rolled up into a formal Prime Contract Change Order.
  • AIA Definition of CCD: AIA G714. An AIA document that is by its nature a directive by the Owner/Architect that may affect cost and time.
  • Additional Acronyms in the CCD Process:
    • SCO: Subcontract Change Order
    • OCO: Owner Change Order
    • CO: Change Order
    • SWD: Special Work Directive
    • ASI: Architects Supplemental Instruction
  • Other Industry Naming/Nomenclature
    • Prime Contract Change Request/Notification
    • Owner Change Request/Notification
    • Project Change Request/Notification
THE TYPICAL CCD PROCESS  

1.  A project team determines that an event has occurred which changes the current Prime Contract, Documents, and/or Agreements.       

 

Following are examples of items to include on a CCD Log:

ASI's, Revisions, Allowances, Owner Pricing Exercises/Requests, Pending VE Options, Unforeseen Conditions, Weather Delay Claims, RFI's that have cost implications, marked up submittals that have cost implications.

   

2.  Upon the change event becoming known, the project team should immediately, using the owner notification template, notify the owner of the changes to reserve our right to adjust the Prime Contract Agreement.

a.  This event is also added to the CCD Log and given a CCD tracking number.

b.  If costs and/or schedule delays are known, they should be stated in the letter.

c.  Review your Prime Contract to determine how this notification should be sent and timing in which the notification must be made after the event became known.

d.  BEST PRACTICE:  Prior to notification being sent, call the owner and discuss the change event.

   

3.  Brinkmann will issue notifications to all subcontractors, vendors, purchase orders, etc. and request any pricing or schedule impacts to be sent to Brinkmann.

a.  Push to have these documents within five (5) working days per the subcontract agreement Article 8.2.

b.  All subcontractors, vendors, and purchase order holders should be notified to ensure all are made aware of the change.

c.  Understand the scope of the change and ensure affected subcontractors/suppliers provide pricing. 

     *In the event a subcontractor/supplier does not supply pricing, be sure to include an estimate for their scope of work and hold that cost separately in your job cost report.

d.  Review all pricing provided to ensure it is acceptable and is in line with project unit/labor rates or known unit costs.

   

4.  Once all costs are known for the CCD event, issue a formal CCD to the owner for approval.

a.  Make sure all areas on the CCD Item Breakdown sheet are filled in. Confirm subcontractor final amounts are accurate.

b.  See Steps Under CCD Form Updating to ensure proper input of information and best practices are achieved.

c.  Ensure all appropriate subcontractor and other supporting backup is included in the submission to the owner.

   

5. Acceptance/Rejection by Owner

 

A.)  Owner Approves CCD - The CCD will be ready for a Formal Prime Contract Change Order.

B.)  Owner Rejects CCD – Review why the CCD was rejected and repeat process above to correct or close out the CCD that was rejected.

Reference the Prime Contract for how costs are determined in the event of a dispute in cost.

   
SUBCONTRACTOR CHANGE ORDERS / SWD'S / FIELD CHANGES
DO NOT SIGN ANY SUBCONTRACTOR CHANGE ORDER FORMS!  

Special Work Directives (SWD’s)

  • SWD’s are field work orders / extra costs authorizations issued by Brinkmann to notify and track costs with subcontractors.
  • Prior to a subcontractor starting extra work in the field, the project team must agree the work is extra, and then an SWD must be issued (Typically issued by Superintendents). 
    • SWD will be issued with the scope of work outlined.
    • Superintendents are ultimately responsible for issuing, tracking, and closing out SWD’s in the field.
  • All subcontractor hours and costs are to be tracked on the appropriate SWD’s.
    • Upon completion of the extra work, the Subcontractor is to report hours and material spent to be logged into the SWD.
    • Completed SWD is then issued to the Subcontractor.
    • Again, do not sign subcontractor change documents. Attaching the unsigned tickets for the SWD’s is acceptable.
    • The subcontractor will use the SWD as a basis for developing their change order request. 
  • Best Practices:
    • Review labor costs (OT, Double Time, or Standard Hours) /understand when this work will be completed.  
    • If the SWD is a Time and Material cost (T&M) push to get estimated man hours from the subs. Don’t have an open ticket.
    • Daily time and material tickets should be turned in by the subcontractors and agreed to by Brinkmann. If there is a disagreement it should be resolved immediately.

Subcontractor Change Orders (SCO)

  • This is the certified change document that adjust subcontractor pricing, terms and conditions, or other project document changes.
    • An SWD does not change the subcontract price until an SCO is executed.
  • Project Managers / Project Engineers compile all project change documents (SWD’s, ASI costs, RFI’s, owner requests, etc.) ready to be processed.
    • WE DO NOT ATTACH SUBCONTRACTOR CHANGE DOCUMENTS TO THE SCO’s.
  • Project admin’s generate SCO's.  Provide the Admin with the Subcontractor, change order description, GC Pay description, and cost.
  • Project admins will send the draft SCO to the PM’s and PE for review prior to sending out to subcontractors. It is the PM’s responsibility to make sure the information is correct.
  • Project admins will send out SCO’s to the subcontractors designated representatives.
    • PM’s / PE’s need to tell project admins who to send the SCO's to.
  • PM’s are responsible for tracking and executing open SCO’s.

Best Practice Guidelines

General CCD Best Practices Include...

  • Cost impacts that are tied to Owner Change Orders should not be issued until the corresponding Owner Change Order has been issued.

  • Per the Subcontract Agreement, a SWD shall not be issued unless Brinkmann agrees that it is scope outside of the Subcontract. 

  • Per the Subcontract Agreement, prior to start of any extra work beginning, an SWD shall be filled out and distributed to the subcontractor/supplier with the scope identified.  Once the work is complete, the SWD shall be updated with labor hours and material used.  The Subcontractor will use this as the basis of their change order request.

  • At every opportunity, try and get pricing from the subcontractor/supplier that can be agreed to and issue a change order before the work starts.  This limits Brinkmann Constructors risk.

  • The Brinkmann Constructors team should review subcontract agreements to ensure the potential extra work is considered a change in scope.

 

The CCD log has a tab for internal cost tracking. This is where SCO’s should be documented.

  • At any point in which additional work is identified, add a line item to the Internal CCD Log to ensure costs associated with the work can be accounted for.
  • Once you receive a ticket or SWD on site add this line item to the internal tracking log.
  • After the subcontractor sends the official CO, fill out the remaining line items.
 
CONVERTING CCD'S TO OCO'S (PCCO'S)  

1. Once a CCD item is approved by the Owner it is ready to be converted into an Owner Change Order.

  1. Note multiple CCD’s can be tied to one Owner Change Order. Discuss with your owner on when and how they would like group CCD’s together.

  2. Understand if your Owner CO gets signed by the Engineer or Architect first before going to the Owner.

  3. BEST PRACTICE:  At a minimum, convert all approved open CCD’s into a Change Order each month in time for Brinkmann and the Subcontractors to bill for the work.

2. Provide the CCD Item Breakdown sheet to the project admin, and they will enter the Owner Change Order into Viewpoint.

You will need to communicate to the Project Admin what SOV Contract Item and which phase code the Owner Change Order should be tied to.

   

3. Project Manager is to review all Owner Change Orders before they are issued.

 
   

4. All Owner Change Orders should include all CCD Item breakdowns and subcontractor costs for each CCD that is included in that CO.

If there is a schedule impact a formal P6 schedule update with new contract completion dates should be included in the Change Order.

5. All Change Orders are to be filed in Procore.

 
6. Once the owner (architect/engineer if required) has approved the change order then subcontractor change orders can be sent.  
   

Allowance Overview and Best Practices:

  • Allowances are funds allocated for known future costs that have not been specified with a high enough degree of detail to enable an accurate estimate of costs to be created.
  • Allowances should are not to be utilized as a “Brinkmann Contingency” without the approval of the owner.  Follow the requirements of the Prime Contract on how money from allowances are to be spent.
  • Allowances are usually associated with materials the owner intends to select after the contract is formed.
  • Each allowance included in the owner contract should be its own CCD item. Some examples of this are winter conditions, signage, permits, dry utility costs, contingencies, rock excavations, undefined design elements, etc.
  • We must communicate with the owner as to who is in control of each allowance or budget item. We must get approval from the owner before spending money towards any allowances or owner-controlled budgets.
  • If the actual cost is less than the allowance or budget, then a credit CO is owed to the owner.
  • If the costs should ever exceed the allowance or budget, then it is imperative that we get an Owner Change Order, no less than every month for the net increased cost to each allowance or budget.
    • Notification to the owner should be made prior to any overage of an allowance occurring.
    • BEST PRACTICE:  Review allowances during each OAC meeting.
    • Example: Winter conditions allowance budget of $100,000 is currently forecasting to be $120,000 due to current project conditions. Brinkmann should notify owner immediately of this cost increase and get approval to increase the allowance budgets.

 

   
CCD FORM UPDATING & INSTRUCTIONS  

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  1. CCD Title & Descriptions:
    1. Titles should match the description on the CCD Log
    2. Descriptions – need to clearly outline why the CCD has been created, and the additional work or costs associated with the impact.
  2. Item Phase Codes – Should tie directly to Viewpoint phase codes.
  3. Item Descriptions – Specific item costs breakdown descriptions.
    1. Sometimes stating “ABC Contractor Cost Impact” with a Lump Sum unit rate price is enough to avoid more work. If you go this route the subcontractor back-up needs to be detailed enough for owner review approvals.
  4. General Conditions, Bond, Builders Risks, Insurance, and Fee’s
    1. Review your Prime Contract Agreement to ensure we are compliant.
    2. The Brinkmann fee % box will not be viewable to the owner, but it you click were the 15% is shown in the above image you can change the fee to match the contract and the formula will recalculate.
  5. BEST PRACTICES
    1. Create a Sub Folder in the CCD Folder for each CCD. Copy all subcontractor back up, owner correspondences, and related information (RFI’s, ASI Narratives, Schedules, etc.) in the folder.
    2. Print PDF this from and include it in the CCD Subfolders.
CCD LOG UPDATING & INSTRUCTIONS  

    

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  1. Change Document – What event created this change (ASI #, RFI #, Etc.)
  2. Description – Title of the CCD Event (Should match the CCD Form Title).
  3. Status – Indicates the current status of the CCD.
    • Approved – Client has reviewed and approved the CCD.
    • Rejected – Client has disagreed and/or does not want to proceed with the CCD.
    • To Be Issued by Brinkmann – CCD is ready for submission to client.
    • Pending Owner Approval – CCD has been issued and is being reviewed by owner.
  4. Type of CCD – Classify what group or category the CCD change falls under
    • Examples – Unforeseen conditions, owner request, value engineering, design change, allowance, design error, Force Majeure , etc.
  5. Change Order Number – Prime Contract Change Order that this CCD is apart of.
  6. Proposal Date – When the CCD was first noted / the impact occurred.
  7. Approval Date – When the CCD was approved by owner.
  8. Approval Amount – Final Costs the CCD was approved for.
  9. Notes – Any general comments / further clarifications or status updates.
INTERNAL COST TRACKING UPDATING & INSTRUCTIONS  

    

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  1. Item Phase Codes (ID #) – Should tie directly to viewpoint phase codes.
  2. Descriptions:
    • Add the subcontractor name
    • Title should match the description on the SCO, these need to clearly outline why the SCO has been created.  
  3. SCO:
    • The dollar valve amount list on the SCO.
  4. Committed Value:
    • The value we have agreed to pay the sub for any added changes.
  5. Brinkmann Risk:
    • This column is used for any subcontractor change order items that are not the owner’s cost. Cost entered into this line item will be any estimates of extras or subcontractor’s cost that has not been included in a SCO to date.  Once it is included in a SCO, the cost will move over to the committed column.
  6. Event/Issue Name:
    • This section can be used in conjunction with the Allowance/Issues tab where the internal log items can be tracked.  For instance if you have issued change orders to multiple subcontractors for winter conditions, you can enter a phase code in this column that ties to a winter conditions line item on the Allowance/Issues tab and provide a total cost.
  7. BEST PRACTICES:
    • Create an internal CCD folder for each subcontractor where you can copy all subcontractor back up, owner correspondences, and related information (RFI’s, ASI Narratives, Schedules, etc.).
    • The field team should use this document and add any items that may be discussed during meetings, day to day interactions with subcontractors, site walks, etc that may be an extra in the future.  The key is to not lose track of any items that will generate additional cost to the project, either Brinkmann or owner.  As a team, the items can be reviewed to determine if they are truly a change.