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Section 2: Claims

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Policy

A claim is an unresolved dispute requiring formal action by the Department's Contract Claim Committee (CCC). All procedures for contract claims resolution are established in accordance with Title 43, Texas Administrative Code §9.2, “Contract Claim Procedure.”

Contract claims may only be filed by the prime contractor. A prime contractor may make a claim on behalf of a subcontractor.

If a contractor does not agree with the District’s decision on the dispute, the contractor may file a detailed report complete with a certification statement and contract claim request with:

If District staff is unsure whether documents received from the contractor constitute a formal claim, forward the documents as received to CST for a determination.

The District must forward all claims to the CCC or CST within 5 business days, in the original condition as received. The CCC will provide the District and the contractor a letter of acknowledgement of acceptance or denial of the claim. CST will provide the District with a copy of the claim, and, if the claim is accepted, the CCC will request that the District submit a detailed report and recommendation within 2 months.

CST will review the claim, consulting with the District and the contractor as necessary to secure any additional information. Responses to CST requests for information associated with the review of the claim must be in writing.

Upon completion of its review, CST will provide a report to the contractor, the District, and the CCC Chairperson containing recommendation(s) for resolution of the claim. The CCC Chairperson will schedule a meeting between the prime contractor and the District in order to afford both sides an opportunity to present their respective stances for the consideration of the Committee.

Until the time of the CCC meeting, the contractor and the District may still pursue the option to settle the claim as a dispute at the District level. In accordance with Article 4.7, notify the CCC through CST in writing of the intent to resume negotiations at the District level and request review of the claim be suspended by the CCC pending the outcome of the negotiations.

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Contract Claim Committee Meeting

The CCC Chairperson will select Committee members at the time the meeting is scheduled, including Division Directors and one or more District Engineers (DEs), with a preference, if possible, for those whose Districts do not have a current contractual relationship with the prime contractor involved in a contract claim.

The informal meeting conducted before the CCC allows both the District and the contractor to discuss the claim without legal counsel. The meeting will be conducted in a cordial, professional, and orderly manner. As dispute negotiation discussions have not resolved the claim, any comments or presentations are to be directed to the CCC. Additional concerns may be brought before the CCC by a contractor, but additional claim issues not submitted in the initial claim or any claim amendments may not be considered for compensation.

After the meeting, the CCC Chairperson will send the contractor written notice of the Committee's proposed disposition of the claim. The contractor must advise the CCC Chairperson in writing within 20 days whether the disposition is acceptable.

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Appeal of Claims

A contractor dissatisfied with the CCC's proposed disposition of the claim may petition the Department's Executive Director for a contested case hearing before the State Office of Administrative Hearings (SOAH). Hearings conducted by SOAH are legal proceedings presided over by an appointed administrative law judge. Coordinate with the General Counsel Division (GCD) to work with the Attorney General’s office in preparation for a scheduled SOAH hearing. The administrative law judge's final decision regarding the claim is forwarded to the department's Executive Director for consideration.

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