What is a Contract Item, or Pay Item, in regards to Road Construction Contracts?
“Contract items,” or “Pay Items,” have a specific meaning in road construction contracts that can be important when preparing a bid, reviewing individual pieces of an overall project, or negotiating changes to a certain contract.Read more
Notably, individual states have somewhat differing definitions of what they classify as Contract Items, but most likely, a contract item is defined as a specific unit of work for which a specific price is provided in the contract documents. Prices for Contract Items can be provided on a per unit basis, or on a lump sum basis for the totality of a Contract Item.
Moreover, some states’ standard specifications delineate a difference between major contract items and minor contract items. A major contract item is typically defined as an item that makes up more than five percent of the entire contract amount. A minor contract is an item which has a value less than five percent of the contract amount. To be sure, the project’s specifications should be reviewed to determine the actual percentage or amount required, typically this can be found in the “Definitions” section of the specifications.