Common use of Project Contingency Clause in Contracts

Project Contingency. 11.1. The overall Project GMP shall include a contingency amount (the “Project Contingency”) for the use by the CM or Owner as allowed by this Agreement. The Project Contingency in the GMP for the Project is One Hundred and Twenty Nine Thousand, Seven Hundred and Seventy Nine Dollars ($129,779. The Project Contingency may only be used to defray increases in the Cost of the Work caused by the following circumstances (but only after the CM has exhausted all credits, unused allowances and any and all other remedies the CM might have): 11.1.1. After the CM has awarded contracts to its Contractors, to pay any costs incurred by the CM as a result of a Contractor default already under contract with the CM but only to the extent the CM is, after a reasonable effort, unable to recover the costs from the Contractor, Contractor’s surety (if any) or other guarantor or insurer; provided, however, that the Project Contingency may not be used to pay deductibles, retention or copayments incurred pursuant to a subcontractor default insurance policy; 11.1.2. To pay for quality assurance testing, inspections or other investigations that the CM believes are necessary to substantiate that work of the Contractors meets the requirements of the Contract Documents, to the extent, after a reasonable effort, the CM is unable to recover the costs from Contractors, Contractors’ sureties or other guarantors or insurers; 11.1.3. To pay for mediation and legal costs per Article 34 if a suit is initiated against the Owner by any of the CM’s Contractor, to the extent, after a reasonable effort, the CM is unable to recover those costs from the Contractor, the Contractor’s sureties or other guarantors or insurers. 11.1.4. If, in the CM and Owner’s opinion, the use of the Project Contingency is advisable or necessary for the benefit of the Project but only after all possible remedies, aside from increased payment by Owner, have been exhausted. The written request from the CM or Owner must contained specific language as to why the use of the Project Contingency is necessary and beneficial to the Project. These include directives from the AHJ or improvements to the Project which are vital to the function, safety operation or maintenance of the project. The Owner may utilize his portion of the Project Contingency for other purposes with approval of the CM. 11.2. The CM shall consult with the Owner and provide the Owner with reasonable documentation justifying every request for payment of any of the Project Contingency. All expenditures of Project Contingency are conditional upon receipt of such documentation and approval of the expenditure by the Owner and only after available credits and unused allowances are first exhausted. Expenditures of Project Contingency may not be used to reimburse the CM for liquidated damages payable to the Owner, for overruns in agreed sums or rates payable for General Conditions, for costs incurred because of any default by the CM in the performance of its own management services, including unjustifiable overpayments to Contractors, or for any other circumstance not specifically covered in the preceding paragraphs. 11.2.1. If the Project Contingency is not exhausted during the Project, fifty percent (50%) of any unspent portion of the Project Contingency, less amounts of liquidated damages owed to the Owner, will be paid to the CM over and above the Cost of the Work, General Conditions and Fixed Fee otherwise due and payable the CM. The remaining fifty percent (50%) of any unspent portion of the Project Contingency will belong to and remain with the Owner.

Project Contingency. 11.1. The overall Project GMP shall include a contingency amount (the “Project Contingency”) for the use by the CM or Owner as allowed by this Agreement. The Project Contingency in the GMP for the Project is One Hundred and Twenty Nine Thousand, Seven Hundred and Seventy Nine Seventy-Four Thousand Sixty Dollars ($129,77974,060). 11.2. The Project Contingency is not meant to add to the Fixed Fee of the CM. The Project Contingency may only be used to defray increases in the Cost of the Work caused by the following circumstances (but only after the CM has exhausted all credits, unused allowances and any and all other remedies the CM might have): 11.1.111.2.1. After the CM has awarded contracts to its Contractors, to pay any costs incurred by the CM as a result of a Contractor default already under contract with the CM but only to the extent the CM is, after a reasonable effort, unable to recover the costs from the Contractor, Contractor’s surety (if any) or other guarantor or insurer; provided, however, that the Project Contingency may not be used to pay deductibles, retention or copayments incurred pursuant to a subcontractor default insurance policy; 11.1.211.2.2. To pay for quality assurance testing, inspections or other investigations that the CM believes are necessary to substantiate that work of the Contractors meets the requirements of the Contract Documents, to the extent, after a reasonable effort, the CM is unable to recover the costs from Contractors, Contractors’ sureties or other guarantors or insurers; 11.1.311.2.3. To pay for mediation and legal costs per Article 34 if a suit is initiated against the Owner by any of the CM’s Contractor, to the extent, after a reasonable effort, the CM is unable to recover those costs from the Contractor, the Contractor’s sureties or other guarantors or insurers. 11.1.411.2.4. If, in the CM and Owner’s opinion, the use of the Project Contingency is advisable or necessary for the benefit of the Project but only after all possible remedies, aside from increased increase payment by Owner, have been exhausted. The written request from the CM or Owner must contained specific language as to why the use of the Project Contingency is necessary and beneficial to the Project. These include directives from the AHJ or improvements to the Project which are vital to the function, safety operation or maintenance of the project. The Owner may utilize his portion of the Project Contingency for other purposes with approval of the CM. 11.211.3. The CM shall consult with the Owner and provide the Owner with reasonable documentation justifying every request for payment of any of the Project Contingency. All expenditures of Project Contingency are conditional upon receipt of such documentation and approval of the expenditure by the Owner and only after available credits and unused allowances are first exhausted. Expenditures of Project Contingency may not be used to reimburse the CM for liquidated damages payable to the Owner, for overruns in agreed sums or rates payable for General Conditions, for costs incurred because of any default by the CM in the performance of its own management services, including unjustifiable overpayments to Contractors, or for any other circumstance not specifically covered in the preceding paragraphs. 11.2.111.3.1. If the Project Contingency is not exhausted during the Project, fifty percent (50%) of any unspent portion of the Project Contingency, less amounts of liquidated damages owed to the Owner, will be paid to the CM over and above the Cost of the Work, General Conditions and Fixed Fee otherwise due and payable the CM. The remaining fifty percent (50%) of any unspent portion of the Project Contingency will belong to and remain with the Owner.