Design professionals and contractors were optimistic when Congress passed the American Recovery and Reinvestment Act to stimulate the economy. A portion of the stimulus funds is allocated to federal projects and federally funded or insured projects that could create up to 14,000 jobs in the design and construction industries, according to the American Institute of Architects
(AIA). As the distribution of funds prompts new construction projects, standard contracts will play an integral role in helping professionals efficiently navigate the building process.
Much of the stimulus money is dedicated for both “federal projects” and “federally funded or insured” projects. On a federal project, a U.S. government agency directly enters into a contract with architects or contractors, and the U.S. government is the project owner. These types of projects are governed by federal statutes and complex regulations, such as the Federal Acquisition Regulations
(FAR) or, for military projects, the Defense Federal Acquisition Regulation Supplement
In light of these statutes and regulations, which tend to be multifaceted, voluminous and subject to frequent change, federal agencies have created their own owner-architect and owner-contractor agreements. However, even on these projects, some standard contract documents can be used as the basis for consulting and subcontracting agreements (e.g., the AIA’s A401, Standard Form of Agreement Between Contractor and Subcontractor, and C401, Standard Form of Agreement Between Architect and Consultant).
In addition, forms such as the G702, Application and Certificate for Payment; G703, Continuation Sheet; E201, Digital Data Protocol Exhibit; and E202, Building Information Modeling Protocol Exhibit, also can be used to effectively administer key activities.
For federally funded or insured projects, the federal government provides direct funding or insurance for construction that is performed for state or local governments or private entities, but the federal government is not the owner. These projects do not require use of FAR-based agreements, so standard contract documents that address the unique terms and conditions of these projects can be used for owner-architect and owner-contractor agreements. Many architects and contractors use these standard documents in conjunction with supplemental conditions developed by federal agencies.
An example of a standard contract document for such projects is the newly released AIA Document B108-2009, Standard Form of Agreement Between Owner and Architect for a Federally Funded or Federally Insured Project. This document, which was developed with the assistance of several federal agencies, includes specific provisions related to cost estimating, compensation and other issues tailored to these types of projects.
The document will be useful to owners and architects working on federally funded and federally insured construction projects, including those funded by the recent stimulus package. B108-2009 is coordinated for use with A201-2007, General Conditions of the Contract for Construction. Several federal agencies have developed supplemental conditions for A201.
For contractors, these agencies also have developed supplemental conditions for A101, as well as other AIA standard form agreements, so that these documents can be used on federally funded or federally insured projects.