AUGMENTATIONS TO CAPITAL PROJECTS, AND RECOGNITION OF PROJECT DEFICITS - 6833

(Revised and Renumbered from 6861.)

Augmentations to Capital Projects:  The PWB’s authority to augment capital outlay projects, and the appropriations for those augmentations, is set out in Government Code (GC) Sections 13332.11 (for design-bid-build projects), 13332.19 (for design-build projects) and 16352.  The augmentation authority is limited as follows:

1. Augmentations are limited to 20 percent of the amount appropriated.
2. Any single augmentation or cumulative augmentation exceeding 10 percent of the funds appropriated requires a 20-day notification to the Joint Legislative Budget Committee (JLBC) prior to action by the PWB.
3. Augmentations are calculated based on total capital outlay appropriations for the subject project.

4. Augmentations of less than 10 percent may be treated as a delegated item by PWB staff, and at their discretion may be approved prior to the PWB monthly meeting.  In this case, the augmentation approval will be reported as a “reportable” at the PWB meeting.

Recognition of Project Deficits: Pursuant to GC Sections 13332.11 and 13332.19, if the estimated cost of the total project is in excess of 20 percent of the amount recognized by the Legislature, when the department requests PWB to approve the preliminary plans, performance criteria, or the guaranteed maximum price, it must also seek PWB’s recognition of an anticipated deficit.  Finance notifies the JLBC of the anticipated deficit if it exceeds 20 percent of total project costs.

Agenda Packages for Augmentations or Recognition of Project Deficits:  These agenda packages require the following information:

1. All information requested in Section 6822, including the standard fiscal reporting requirements and the agenda package.
2. A draft legislative notification, if required.
3. A narrative description justifying the need for the request, including any supporting documentation as appropriate, such as efforts at value engineering, bid tabulations, alternative solutions, change order logs, etc.