Change orders: How much change is too much?

As anyone who has been involved in a construction project knows, construction almost always involves unexpected costs.  The North Carolina General Statutes give local governments the flexibility to address these costs through change orders.  G.S. 143-129(e)(4) says that the bidding laws do not apply to work undertaken “during the progress of” a construction project that was originally bid either formally (under G.S. 143-129) or informally (under G.S. 143-131).  In other words, if a local government bids out a construction or repair project, and then, in the course of the project, discovers an unanticipated problem that will require additional work (and increased cost), the local government does not have to bid out that additional work.  But what are the limits of this exception?  When does the cost or scope of the change order take it outside of this exception?  Is a $1 million change order too much?  Or $500,000 (the formal bidding limit for construction projects)?  Is 50% of the original contract cost too much?  25%?  10%?
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Smoking: What Is A Restaurant?

Shortly after the 2010 New Years’ celebrations have died down, smoking will be prohibited in most restaurants and bars across the state. In addition, local governments will have new authority to regulate smoking in many public places. The new law can be seen here and my summary of it is in this Health Law Bulletin from May 2009.

One of the definitional issues that I have been struggling with recently relates to use of the term “restaurant.” Read more »

Amending the Budget Ordinance—

Anxieties are running high among many local government officials as they await the adoption of the State’s budget to learn the fate of local revenue sources. In fact, according to a July 30, 2009, bulletin update from the North Carolina League of Municipalities, pursuant to State budget negotiations as of that date, counties and municipalities potentially stand to lose at least a portion of their beer and wine tax proceeds, resulting from state excise taxes on beer, fortified wine and unfortified wine. The prospective aggregate loss to local governments is $33 million. The revenue loss to any one local unit may not be substantial. But, because many, if not most, local governments already have adopted their budget ordinances for this fiscal year, local units are going to have to make at least some adjustments. Which raises the question, what are the rules governing if, when, and how a local unit may amend its budget ordinance once it has been adopted? Read more »