1. 14.21 Contract Closeout Procedure Update Notice of Completion, Release of Retention and Punchlist Resolution December 8, 2005

2. Update of Revised guidelines for the closeout of construction contract and the release of retention Training Objective

3. Topics LACOE / LAUSD Decisions Certificate of Substantial Completion Occupancy vs. Substantial Completion Notice of Completion (NOC) Release of Retention Punchlist Resolution (using Alt Contract Methods)

4. LACOE / LAUSD Key Decisions Change Orders may be processed for Approval after NOC Change Order Work must be performed prior to Substantial Completion Payment Applications for Change Orders processed after the NOC has been filed will be paid 100% (no Retention withheld) Undisputed Retention will be released with existence of a Punchlist Punchlist should contain corrective items, NOT unperformed scope

5. Requirements for Substantial Completion 100% Completion of the “Work of Improvement” All Change Order work performed Also includes*, but not limited to: Operation/Maintenance instructions Preliminary Warranties/Guarantees All manuals, spare parts and extra materials Final Cleanup/ Removal of tools, construction equipment,etc. Owner Orientation/Training completed Testing & Inspection of all equipment and systems completed Continuous flushing of the building HVAC system for 14 days following testing and inspection of equipment *See Contract Closeout Checklist

6. Contract Date of Substantial Completion Substantial Completion date establishes the following: (GC Section 14.16) Establishes “Completion” of the “Work of Improvement” 60-day clock start to release Retention Contractor responsibility for site ends (GC Section 7.4.9) Starts OWNER responsibility for the Project End Date for OWNER provided Builder’s Risk Start Date of District insurance Start of Warranty/Guarantee period End Date for Liquidated Damages *After 60 days the District is subject to a 2% penalty per month on improperly withheld Retention

7. Occupancy (or Partial Use) vs. Substantial Completion Substantial Completion NOT necessary to take Occupancy (Partial Use) -OR- Open a School To achieve Occupancy (or Partial Use) OAR/IOR/AOR/Contractor inspect areas to be occupied Record/document status of Completion (i.e. punchlist) OAR Issues Notice of Partial Use / Occupancy to Contractor: interim agreement on responsibilities for safety, security, maintenance, operation, heat, utilities, damage to the Work, insurance, and warranties and guarantees for the areas to be occupied

9. Definition of “Punchlist” Items 1. Items listed on Punchlist are MINOR 2. CORRECTIVE in nature, not unperformed scope 3. Punchlist Items are required to be resolved in the TIMEFRAME established in the Contract and Certificate of Substantial Completion (30 days)

10. Notice of Completion (NOC) NOC must be filed within 10 days of Substantial Completion (California Civil Code section 3093) Fax copy of Certificate of Substantial Completion to: Veronica Villavicencio Facilities Construction Contracts Fax No: (213) 413-4853 (w/ instructions to file the Notice of Completion) FCC prepares Completion of Contract Memo for Director of Contracts signature; files NOC with the County A copy of the NOC can be found online at www.laschools.org

11. What Does Notice of Completion “Trigger” ? 30 day Sub Contractor period to file Stop Notices 120 day period for Contractor to resolve outstanding Stop Notices 180 day period for Labor Claims resolution

12. Release of Retention Release of Retention is initiated by the OAR using the Release of Retention Authorization Form plus required attachments: Copy of the NOC filed Conditional/Unconditional Waiver and Release Form Punchlist (including $ values x 150%) All relevant Withholds/Releases

13. Release of Retention If Contractor invoices for Retention, simply attach the Release of Retention Authorization form and submit both for processing Retention is paid ONE time Remaining monies retained are for specific obligations to withhold (i.e. stop notices, labor claims, etc.)

14. Releases remaining retainage on the Contract; except for specific obligations to withhold Allows withholds for: Potentially Disputed items (after date of SC) Stop Notices Labor Compliance withholds Amount not yet invoiced for by the Contractor Pending Credit Change Orders Release of Retention Authorization form

15. Disputed items to be withheld from Retention release Using the Form!

16. First you calculate what is currently retained Then release Retention while withholding for obligations Revised and Expanded Owner Assessment Summary Using the Form!

18. Withholds Released (After Release of Retention) Utilize the Withhold Release Authorization form for all releases after Retention payment Currently in use by FCS to release Stop Notice and Labor Compliance after NOC has been filed and Retention released OAR should use the Withhold Release Authorization to release monies withheld for resolved Punchlist items and monies assessed

19. Withhold Release Authorization form Screenshot of Withhold Release Authorization form

20. Punchlist Resolution by Alternate Contract Methods Job Order Contracting (JOC) Defined unit prices for most common Punchlist items Contact Facilities Contracts Services Informal Contracts (A&B) For Contracts under $15,000 Contact Facilities Contracts Services M&O Work Orders Coordinate with M&O Contact Facilities Contracts Services

21. NEXT TRAINING January 2006: Contract Closeout Training – Part II Changes to the General Conditions Revised 14.22 Contract Closeout Procedures End of Contract Actions Final Assessment Letter to Contractor Regional Contract Closeout Teams

22. Contract Closeout Procedure Update Questions and Answers

23. EXHIBITS

24. How to get a copy of the NOC online Login to www.laschools.orgwww.laschools.org Click the “Contractor” tab Click the “Construction” link on the “Contractor” tab Click the “Notices of Completion” link Enter the Contract number in the “Search file names for” text box and hit enter All the documents related to the Contract will show up Click the document name starting with “NOC” and you will open the Notice of Completion filed with the County in a.pdf file