Common use of Cost Overrun Clause in Contracts

Cost Overrun. In cases where all of the following are true: (i) the lowest responsive bid for or proposed total cost of construction of a Covered Project is at least 25% greater than the Public Owner’s pre-bid estimate of construction cost; (ii) the Public Owner’s construction management team receives reasonably reliable indication that application of the Agreement will increase project construction costs beyond the Public Owner’s pre-solicitation estimate by at least 10%; and (iii) the cost increase jeopardizes the ability of the project to move forward within the Public Owner’s established budget parameters or confirmed funding sources; then the Public Owner may reject such bid or proposal and re-solicit the project with revised project terms, including discretion to re-solicit without application of this Agreement, or with revised terms agreed among the Parties.