A GMP has a contractor contingency line item. What governs whether a cost may be charged to that contingency?
Correct Answer
A) The contract's contingency-use terms and required approval process
Use of contingency is governed by the contract's contingency language and required approval or reporting process. Other choices ignore the contract controls for contingency use.
Why This Is the Correct Answer
Use of contingency is governed by the contract's contingency language and required approval or reporting process. Other choices ignore the contract controls for contingency use.
Why the Other Options Are Wrong
Option B: Base the contingency authorization response on any subcontractor request without review
Choice B (Any subcontractor request without review) is rejected because it tries to bypass the Contingency authorization checkpoint.
Option C: Base the contingency authorization response on the bidder's private estimate notes
In procurement and contracting, The bidder's private estimate notes only is the wrong selection for Contingency authorization: it leaves the work at an informal or incomplete stage, while Contingency authorization requires The contract's contingency-use terms and required approval process.
Option D: Use the payment application file as the backup record for contingency authorization
The trap in D is The final punch list regardless of cause. That selection is wrong because the choice would not get the project to The contract's contingency-use terms and required approval process, which is the Contingency authorization result verified by the source; GMP contingency use is controlled by contract terms.
Memory Technique
Make contingency authorization a tabbed card: cite the exact condition, then choose The contract's contingency-use terms and required approval process.
Reference Hint
Open Construction Project Management, 5th Ed. (2022); use the index entry or section for "GMP contingency administration" to confirm that Use of contingency is governed by the contract's contingency language and required approval or reporting process.
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