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Construction
project closeout often is a lengthy and problem-plagued phase of a construction
project. Closeout refers to the completion of all construction contract
specifications following large completion, including punch list items,
delivering documentation such as operations and maintenance manuals, as-built
drawings, contractor’s confirmation forms, resolution of change orders and
claims, final inspections, final payment and owner’s internal resolution of all
accounts and reporting.

The
first step within this sometimes-confusing process is the identification of any
remaining aspects of the work, any defective equipment and technology items,
any defective materials, and any defective workmanship. This is the time to
review any change requests, view all work and go over your first documentation
to ensure you have fulfilled your obligations to your client. If the project in
question were a house then you would need to ensure the building is secure, any
amenities are in perfect working condition, and all additions requested were
done as the contractor wished.

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After
you have completed reviewing the project and evaluating if it meets both the
architect and the client’s standards, you must begin placement on a punch list,
first by the contractor and then by the architect, of all items found that
still need work. You will need to document that all work has been completed as
outlined in the original contract or order; if something is missing, incomplete
or not done correctly, document and take steps to correct. It is also critical
to indicate the time when this occurs and if it falls under Substantial
completion. This is essential because this is the date that triggers retainage
release, retainage is a part of the agreed-upon contract price deliberately withheld
until the work is substantially complete to assure the contractor or
subcontractor will satisfy its obligations and complete a construction project.

After
formulating a punch list and establishing whether the work completed can be
considered Substantial completion and all complications involved in those
areas, you can then begin the startup, testing, and operation of all systems
(HVAC, plumbing, electrical, security, etc.) and placement of any problem items
on a punch list. After forming a punch list of all problem involving these
facilities then you can combine this punch list with the one created within the
last step and continue into the next stage of the closeout.

The
next stage within the closeout is the completion of all things on the newly formed
punch list. The work may include incomplete or incorrect installations or
incidental damage to existing finishes, material and structures. This is vital
because final contractor payment is made when the punch list of items is
completed to meet the project design required by the contract, or some other
mutually agreed resolution for each item is reached. Examples of punch list
items include damaged building components lie repairing shattered windows,
replacing stained wallboard, repairing cracked paving, etc., or problems with
the final installation of building materials or equipment such as reinstalling
peeling carpet, replacing missing roof shingles, testing boiler for fire and
pressure, obtaining elevator use permit, activating security system, etc.

After
completing all work on your punch list your next two steps are the issuance of
the certificate of substantial completion by the architect and rekeying of all
locks for turnover to the owner. The certificate of substantial completion is
an acknowledgment by the architect that the project has reached a stage in the
construction process where the owner can occupy it, even though there may still
be minor items on the punch list to complete. The certificate of substantial
completion will list any remaining punch list items that must be completed. The
importance of procuring the certificate of substantial completion to the
general contractor is that it established the official date for influencing
whether liquidated damages will be assessed. If the date of issuance of the
certificate of substantial completion is on or before the final contracted date
for completion of the project, no liquidated damages can be assessed. Be that
as it may, the certificate of substantial completion comes after the contracted
completion date, damages can become an issue. The rekeying, of course, is done
for security purposes to ensure no harm or vandalism occurs after the
completion date by any of the former workers or their associates.

After
the issuance of the certificate of substantial and rekeying of all locks the
review with the owner of all operator’s manuals and turnover of the manuals
occurs. An operator’s manual also called an instruction manual or a user guide
is an instructional book or booklet that is supplied with almost all
technologically advanced consumer products such as vehicles, home appliances,
and computer peripherals. The information contained in the owner’s manual
typically includes safety instructions; for liability reasons, these can be
extensive, often including warnings against performing operations that are
ill-advised for product longevity or overall user safety reasons. Assembly
instructions; for products that arrive in pieces for easier shipping. Maintenance
instructions. Troubleshooting instructions; for when the product does not work
as expected. Service locations; for when the product requires repair by a
factory authorized technician. Warranty information; sometimes provided on a
separate sheet.

After
the manual turnover, the review with an owner of warranty materials begins. In
contract law, a warranty possesses various meanings but generally means a
guarantee or promise which provides assurance by one party to the other party
that specific facts or conditions are true or will happen. This factual
guarantee may be enforced regardless of materiality which allows for a judicial
remedy if that promise is not true or followed.

Finally,
there are two financial concerns that remain before the completion of the
procedures, the first of which is the remittal of all remaining payments. Which
essentially is to send money to remove an obligation or liability and to pay
for goods and services. The second financial concern and the final step is the
release of any retained funds.

 

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