Select Board Discusses Change Order Policy

LONGMEADOW, MA – The Select Board last week voted to table discussion in regards to creating a policy that would detail the delegation of authority when it comes to approving change orders for construction projects.

Marybeth Bergeron, chair of the Longmeadow Building Committee, spoke before the Select Board at its Aug. 6, 2018, meeting to inform the board that the Building Committee had already approved a tiered approach to change order approvals at its May 29, 2018 meeting.

“The building committee, as you know, is approximately a year old,” Bergeron said. “We have been establishing…various policies and procedures, and we did in fact establish a policy in reference to change orders at our May meeting. In essence, that policy was to allow the Town Manager some latitude as far as change orders are concerned, because oftentimes in the course of construction smaller change orders come up that don’t really necessarily require a full Building Committee meeting (to approve). As a general rule of thumb, we felt this was an appropriate allocation of authority within dollar figures.”

In May, the Building Committee approved a tiered approach to change order approvals contingent upon cost. Change orders up to $15,000 would be handled by the Town Manager; $15,000 to 50,000 by the construction sub-committee via email or conference call with the Town Manager; $50,000 to $100,000 by the Building Committee and the Town Manager; and $100,000 or more by the Select Board.

The Select Board had discussed limiting change order approvals by the Building Committee to no more than 5 percent of the project’s contingency fund, but Bergeron stressed that percentage was too low.

Using the current Department of Public Works facility project as an example, Bergeron explained why.

“Certainly with the amount of money that is in the contingency account, which initially was approximately $700,000, to limit change order requirements to 5 percent, or $35,000…it seems to be very restrictive in that you might be supplanting any authority given to the Building Committee for change orders,” she said. “I do think $35,000 is very limiting. If you are to go ahead with that, I would ask for latitude on the part of the building committee so that we don’t have to call a full Building Committee meeting for a change order of $3,000 when clearly the Town Manager has the skill set to be able to approve such a change order.

“I would ask that the 5 percent restriction that is placed certainly be reconsidered to something somewhat more than that. As construction progresses, sometimes you have to make quicker decisions…without calling a full Select Board meeting.”

Select Board Chair Mark Gold disagreed, referring to the speed in which the Select Board was able to approve the two most recent change orders in regards to the asbestos abatement at the site upon which the new DPW facility is being built.

“I think there may be a disconnect in speed of action,” he said, later noting that he “didn’t see 5 percent as being restrictive at all.” He also noted that when it comes to spending decisions accountability is on the Select Board, even if the Building Committee is acting with the best intentions.

“Ultimately it’s the Select Board that has direct accountability to residents because we’re elected officials,” he said.

Select Board member Richard Foster also questioned Bergeron about the tiered change order policy the Building Committee adopted, asking why the Select Board had not been informed about the decision and requesting the Select Board “be in the loop” and “fully briefed” at all times.

“The Building Committee was created for the town by the Select Board,” he said. “The Select Board should be communicated back on policies that a board is developing for change orders.

“It goes beyond just the money,” he added. “To me, it’s communication about what is going on. That’s the most important thing.”

Finance Director Paul Pasterczyk suggested a policy be considered for Building Committee change order approval that limited authority to “x percent” of the contingency fund or “x dollars,” whichever is greater, without the need for Select Board approval, using 5 percent or $50,000 to $100,000 as an example.

Select Board Vice Chair Marie Angelides also said it would be nice to have a policy in place that was “more clearcut by numbers” and suggested appointing a liaison to the Building Committee to help adjust the policy.

The Select Board then unanimously approved Foster as the Building Committee liaison and tabled discussion about the change order policy until the Select Board’s next meeting.

– By Jeff Hanouille