Fuel Clause

Southern California Contractors Association Serving the union heavy construction industry for 34 years
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	8/22/05 Fuel Costs We sent the following “Suggested Fuel Cost Adjustment Clause for Grading Contractors” back in May 1996 following its development by an SCCA Committee: May 8, 1996 Re: Suggested Fuel Cost Adjustment Clause for Grading Contractors Due to the current escalation of fuel costs, the following language is suggested for earth moving contractors to keep pace with rising costs. “The contract prices are based upon diesel fuel costing ____ per gallon. Should the cost of fuel increase, the contract amount will be adjusted in the amount of $0.0015 per cubic yards each one cent increase in the fuel cost per gallon multiplied by the sum of the number of cubic yards of all excavation items as of the date of increase. The cost of fuel shall be that price which is in effect as of the date of delivery at the job site for truck and trailer loads.’ This language has been utilized effectively in the past during periods of unstable fuel prices and is provided for your information only. Staff has received several requests for this information. Staff distributed a copy of the May 8, 1996 memo at a recent seminar and asked for input, corrections, etc. Staff suggests that the memo be updated. You may wish to consider “per hour” rates as well. Staff has become aware of situations where jobs have been bid over a year ago and members are experiencing significant cost increases for fuel. Staff has also become aware of situations where some agencies or contracts will permit change orders or other arrangements for increased fuel costs. In some cases contractors are held to the bid and no allowance is made for increased fuel costs. If you have suggestions or comments, please advise.

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