KDOT Contract Administration & Payment 2 — Questions and Answers
Question 1: When a contractor submits a progress payment estimate, what is the primary document the inspector should verify against?
- The contractor's internal invoice
- The approved bid schedule of values and field measurements (Correct answer)
- The project owner's budget spreadsheet
- The subcontractor's billing statement
Correct answer: The approved bid schedule of values and field measurements
Progress payment estimates must be reconciled against the approved bid schedule of values and verified field measurements to ensure quantities are accurate.
Question 2: Under KDOT contract administration, what action must be taken if a contractor performs unauthorized extra work without a change order?
- Pay the contractor at force account rates automatically
- Issue a stop-work notice and deny payment until a change order is executed (Correct answer)
- Allow the work but deduct 10% as a penalty
- Document the work and pay at the lowest bid item rate
Correct answer: Issue a stop-work notice and deny payment until a change order is executed
Unauthorized extra work cannot be paid without an executed change order; a stop-work notice may be required and payment is withheld until proper authorization is obtained.
Question 3: What does the term 'retainage' mean in KDOT construction contracts?
- A fee paid to the engineer for inspection services
- A percentage of each progress payment withheld until project completion (Correct answer)
- Compensation for contractor overhead during delays
- A bonding fee held by the surety company
Correct answer: A percentage of each progress payment withheld until project completion
Retainage is a specified percentage (typically 5–10%) withheld from each progress payment to ensure the contractor completes all work and corrects deficiencies.
Question 4: Which of the following best describes a 'force account' payment method on a KDOT project?
- A fixed lump-sum payment agreed upon before work begins
- Payment based on actual labor, equipment, and material costs plus a markup (Correct answer)
- Payment at the unit price listed in the original bid
- A daily rate paid to the contractor for standby time
Correct answer: Payment based on actual labor, equipment, and material costs plus a markup
Force account payment reimburses the contractor for actual documented costs of labor, equipment, and materials plus an agreed markup, used when work cannot be practically quantified in advance.
Question 5: A KDOT inspector discovers that measured quantities exceed the original contract quantity by more than 25% for a single bid item. What is typically required?
- No action; pay at the original unit price for all quantities
- A change order or supplemental agreement may be required to adjust the unit price (Correct answer)
- The excess quantity is performed at no cost to KDOT
- The contractor must absorb the additional cost
Correct answer: A change order or supplemental agreement may be required to adjust the unit price
KDOT Standard Specifications require a change order or supplemental agreement when quantities deviate significantly from bid quantities, as the original unit price may no longer be equitable.
Question 6: What is the purpose of the 'final estimate' in KDOT contract administration?
- To establish the initial contract amount before construction begins
- To reconcile all contract items and determine the final payment due the contractor (Correct answer)
- To estimate future maintenance costs after project completion
- To calculate the engineer's fee for project oversight
Correct answer: To reconcile all contract items and determine the final payment due the contractor
The final estimate reconciles all measured quantities, change orders, and adjustments to establish the total earned amount and the final payment owed to the contractor.
Question 7: Under KDOT procedures, when a subcontractor performs work, who is legally responsible for payment to the subcontractor?
- KDOT pays subcontractors directly upon request
- The prime contractor is responsible for all subcontractor payments (Correct answer)
- The project engineer approves subcontractor payments independently
- The bonding company makes subcontractor payments directly
Correct answer: The prime contractor is responsible for all subcontractor payments
The prime contractor is legally and contractually responsible for paying all subcontractors; KDOT's contract relationship is solely with the prime contractor.
KDOT Contract Administration & Payment 2
When a contractor submits a progress payment estimate, what is the primary document the inspector should verify against?