Podcast
Questions and Answers
Under what circumstance can a change order be implemented without the Investor Member's consent, assuming the project is before the Construction Completion Date?
Under what circumstance can a change order be implemented without the Investor Member's consent, assuming the project is before the Construction Completion Date?
- If the change order is for $30,000, the cumulative changes amount to $100,000, it doesn't diminish construction material quality, and it extends the project by 25 days. (correct)
- If the change order is for $60,000, and the aggregate of all prior change orders is $140,000, but does not diminish construction material quality or delay completion by more than 30 days.
- If the change order is for $55,000, the total change order amount is less than $150,000, construction material quality is improved, and it does not extend the project timeline.
- If the change order is for $40,000, the cumulative changes total $120,000, it introduces more durable construction materials and methods, and it extends the project by 45 days.
A project is nearing its Construction Completion Date. Several change orders have already been approved. Which scenario necessitates obtaining the Investor Member's consent for a new change order?
A project is nearing its Construction Completion Date. Several change orders have already been approved. Which scenario necessitates obtaining the Investor Member's consent for a new change order?
- The new change order enhances the quality of construction materials, costs $30,000, brings the total change order amount to $90,000, but delays completion by 28 days.
- The new change order involves a minor aesthetic alteration, costs $10,000, the total change order amount is $40,000, and it replaces a cheaper material.
- The new change order costs $45,000, the cumulative cost of all change orders will be $145,000, and it accelerates the project's completion by 2 weeks.
- The new change order costs $20,000, the cumulative cost of all change orders will be $160,000, and it does not impact the project completion date or material quality. (correct)
What condition, related to project timeline, requires the Investor Member's consent, assuming the project is before the Construction Completion Date?
What condition, related to project timeline, requires the Investor Member's consent, assuming the project is before the Construction Completion Date?
- Any change order that extends the initially scheduled Construction Completion date by any amount of time.
- Any change order that accelerates the initially scheduled Construction Completion date.
- Any change order, that when combined with all prior change orders, will not extend the initial scheduled date for Construction Completion by more than thirty days. (correct)
- Any change order, regardless of its impact on the timeline, as long as it improves the quality of construction.
In the context of this agreement, what constitutes a 'material diminishment' in construction materials or methods, thereby requiring the Investor Member's consent for a change order?
In the context of this agreement, what constitutes a 'material diminishment' in construction materials or methods, thereby requiring the Investor Member's consent for a change order?
What cumulative impact would necessitate the Investor Member's approval, regardless of individual change order amounts, assuming the project is before the Construction Completion Date?
What cumulative impact would necessitate the Investor Member's approval, regardless of individual change order amounts, assuming the project is before the Construction Completion Date?
If a change order, which individually falls under the $50,000 limit, introduces a minor delay, what determines whether the Investor Member's consent is needed?
If a change order, which individually falls under the $50,000 limit, introduces a minor delay, what determines whether the Investor Member's consent is needed?
A change order is proposed that will substitute a more environmentally friendly material that is slightly less durable. Assuming other restrictions are met, does this require investor approval and why?
A change order is proposed that will substitute a more environmentally friendly material that is slightly less durable. Assuming other restrictions are met, does this require investor approval and why?
What is the primary significance of the 'Construction Completion Date' in the context of managing change orders?
What is the primary significance of the 'Construction Completion Date' in the context of managing change orders?
Consider a scenario where a necessary change order will exceed both the individual and aggregate cost limits, but it demonstrably enhances the long-term value and sustainability of the project. What action must be taken?
Consider a scenario where a necessary change order will exceed both the individual and aggregate cost limits, but it demonstrably enhances the long-term value and sustainability of the project. What action must be taken?
A project manager proposes a change order that reduces the initially planned scope of the project to lower costs, ensuring the total cost of all changes remains within the $150,000 limit. How should the Investor Member view this change?
A project manager proposes a change order that reduces the initially planned scope of the project to lower costs, ensuring the total cost of all changes remains within the $150,000 limit. How should the Investor Member view this change?
Imagine a situation where a change order is required to address an unforeseen environmental regulation that was not accounted for during the initial project planning. This change will increase costs and potentially delay the project. What is the most appropriate course of action?
Imagine a situation where a change order is required to address an unforeseen environmental regulation that was not accounted for during the initial project planning. This change will increase costs and potentially delay the project. What is the most appropriate course of action?
If multiple change orders are submitted simultaneously, how should their potential impact on the project's timeline and budget be evaluated?
If multiple change orders are submitted simultaneously, how should their potential impact on the project's timeline and budget be evaluated?
A change order is proposed to use a new, innovative construction technique that is unproven but promises significant long-term cost savings. However, it carries a higher risk of initial complications. How should this be approached?
A change order is proposed to use a new, innovative construction technique that is unproven but promises significant long-term cost savings. However, it carries a higher risk of initial complications. How should this be approached?
What procedural step is critical before implementing any change order that affects the 'Plans and Specifications' of the project?
What procedural step is critical before implementing any change order that affects the 'Plans and Specifications' of the project?
A change order is proposed that marginally reduces the size of common areas in a residential building but increases the size of individual apartments. The overall square footage of the building remains unchanged. How should this be evaluated?
A change order is proposed that marginally reduces the size of common areas in a residential building but increases the size of individual apartments. The overall square footage of the building remains unchanged. How should this be evaluated?
A change order proposes to substitute a more expensive, imported material for a locally sourced one, arguing that it will significantly enhance the building's aesthetic appeal and market value. This change exceeds the individual cost limit but not the aggregate limit. What considerations are most important?
A change order proposes to substitute a more expensive, imported material for a locally sourced one, arguing that it will significantly enhance the building's aesthetic appeal and market value. This change exceeds the individual cost limit but not the aggregate limit. What considerations are most important?
A change order proposes using a different construction method that is faster but has a slightly higher risk of requiring rework later. The cost is within limits, and the timeline impact is neutral. How should this be approached?
A change order proposes using a different construction method that is faster but has a slightly higher risk of requiring rework later. The cost is within limits, and the timeline impact is neutral. How should this be approached?
When assessing the cumulative impact of change orders on a project's timeline, what specific dates should be compared?
When assessing the cumulative impact of change orders on a project's timeline, what specific dates should be compared?
If a proposed change order involves substituting a material that is technically superior but aesthetically different, what factors should be considered in determining whether it constitutes a 'material diminishment'?
If a proposed change order involves substituting a material that is technically superior but aesthetically different, what factors should be considered in determining whether it constitutes a 'material diminishment'?
In the event of a dispute between the project manager and the Investor Member regarding the necessity or impact of a proposed change order, what is the most appropriate course of action?
In the event of a dispute between the project manager and the Investor Member regarding the necessity or impact of a proposed change order, what is the most appropriate course of action?
If a change order is required due to an error or omission in the original Plans and Specifications, how should the responsibility for the resulting costs be determined?
If a change order is required due to an error or omission in the original Plans and Specifications, how should the responsibility for the resulting costs be determined?
What is the primary reason for requiring Investor Member consent for change orders that exceed certain thresholds?
What is the primary reason for requiring Investor Member consent for change orders that exceed certain thresholds?
A change order proposes altering the layout of a building to improve its energy efficiency, which will also qualify the project for certain tax credits. This change will slightly increase initial costs. How should the Investor Member evaluate this proposal?
A change order proposes altering the layout of a building to improve its energy efficiency, which will also qualify the project for certain tax credits. This change will slightly increase initial costs. How should the Investor Member evaluate this proposal?
A change order is requested to replace a specific brand of appliance in all units with a different brand that has similar specifications. This change is driven by supply chain issues, which would otherwise cause a delay. How should this change be evaluated?
A change order is requested to replace a specific brand of appliance in all units with a different brand that has similar specifications. This change is driven by supply chain issues, which would otherwise cause a delay. How should this change be evaluated?
A change order proposes to add smart home technology throughout the project, providing an important upgrade. This change is individually and aggregately within limits, but will require new vendors. What is the most important consideration?
A change order proposes to add smart home technology throughout the project, providing an important upgrade. This change is individually and aggregately within limits, but will require new vendors. What is the most important consideration?
Flashcards
Change Orders Approval
Change Orders Approval
Changes to the approved Plans and Specifications before the Construction Completion Date require Investor Member consent unless certain conditions are met.
Individual Change Order Limit
Individual Change Order Limit
An individual change order must not exceed $50,000 to be approved without Investor Member consent.
Aggregate Change Order Limit
Aggregate Change Order Limit
The aggregate amount of all change orders must not exceed $150,000 to be approved without Investor Member consent.
No Material Diminishment
No Material Diminishment
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Construction Delay Limit
Construction Delay Limit
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Study Notes
- Change orders for the approved Plans and Specifications for the Project Property before the Construction Completion Date are allowed only with the Investor Member's consent unless all of the following conditions are satisfied:
- An individual change does not exceed $50,000, and the total of all prior change orders does not exceed $150,000.
- The change order does not cause a significant reduction in the construction materials or methods approved in the Plans and Specifications.
- The change order, when combined with all prior change orders, will not extend the initial scheduled date for Construction Completion by more than thirty (30) days.
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Description
Change order conditions and limitations for construction projects. Consent needed for changes exceeding $50,000 individually or $150,000 in total. Changes shouldn't reduce construction quality or extend project completion by more than 30 days.
