Change Orders are instructions to revise construction plans after they have been completed. Change orders are common to most projects, and very common with large projects. After the original scope (or contract) is formed, complete with the total price to be paid and the specific work to be completed, a client may decide that the original plans do not best represent his definition for the finished project. Accordingly, the client will suggest an alternate approach.
Common causes for change orders to be created are:
" The project's work was incorrectly estimated;
" The customer or project team discovers obstacles or possible efficiencies that require them to deviate from the original plan;
" The customer or project team are inefficient or incapable of completing their required deliverables within budget, and additional money, time, or resources must be added to the project; and
" During the course of the project, additional features or options are perceived and requested.
Florida Compensation for Change Orders refers to the financial compensation provided to contractors or builders in the state of Florida when there are changes made to the original construction plans or scope of work. This compensation is generally agreed upon prior to the start of a project and helps cover the additional costs incurred due to changes requested by the client or unforeseen circumstances. Change orders are common in the construction industry as they address changes in project requirements, design modifications, and unforeseen circumstances that may arise during the construction process. Florida's compensation for change orders is necessary to ensure that contractors are fairly compensated for any extra work or expenses they incur due to these changes. There are various types of compensation for change orders in Florida, depending on the nature and scope of the changes. Some common types include: 1. Time Extension Compensation: This type of compensation is provided when the change order results in a delay of the project's completion. It reimburses the contractor for any additional time spent on the project beyond the original schedule. 2. Material and Labor Cost Compensation: If the change order requires the use of additional materials or labor that were not originally accounted for in the contract, the contractor is entitled to compensation for these expenses. 3. Overhead and Profit Compensation: Along with direct costs, contractors are typically entitled to overhead and profit compensation for change orders. Overhead costs include expenses such as administrative fees, office rent, and utilities, while profit compensates the contractor for the risk and expertise involved in managing the change order. Builder Allowance Underage in Florida refers to a situation where the cost of materials or labor exceeds the allotted allowance provided by the builder to the homeowner. Builders often offer allowances to homeowners for specific items such as flooring, cabinets, or fixtures, allowing them to choose materials within a predetermined budget. However, if the homeowner exceeds the allowance amount by selecting higher-priced options, they are responsible for paying the difference. This difference is referred to as "underage" and covers the additional costs incurred beyond the builder's allowance. It is important for homeowners to thoroughly understand the allocated allowances and carefully select items within the provided budget. Failure to do so may result in unexpected out-of-pocket expenses if the chosen items exceed the builder's allowance, leading to builder allowance underage. In conclusion, Florida Compensation for Change Orders and Builder Allowance Underage are significant aspects of construction projects in Florida. Contractors should clearly outline provisions for compensation in their contracts to ensure fair and equitable adjustments to the project scope, while homeowners need to be mindful of their selections and adhere to the builder's allowances to avoid any unexpected costs.
