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Thursday, January 12, 2012

Ancel Glink Municipal Question of the Month - Change Orders

Municipal Q&A - January 2012:

What does a governmental body need to do to approve a change order to a contract previously entered into?

Answer:  State law establishes a rather complicated process for the approval of significant change orders.  (720 ILCS 5/33E-9)  If a change order necessitates an increase or decrease in the cost of the public contract by a total of $10,000 or more, or in the time of completion by a total of 30 days or more, then the corporate authorities of the governmental body or a designee must make a written determination that one of the following three circumstances exists: 

(1) the circumstances that necessitate the change in performance were not reasonably foreseeable at the time the contract was signed, or

(2) the change is germane to the original contract as signed, or

(3) the change order is in the best interest of the unit of State or local government and authorized by law.

The written determination and change order must be preserved in the contract's file and also available for inspection by the public.  Violators of this statute are subject to criminal penalties. 

To review other Q&A or to subscribe to the monthly Q&A, visit Ancel Glink's website.


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