A JD Supra analysis published Wednesday walks through a clause that costs contractors money every time Washington stalls: the government-directed changes rule on federal and federally funded construction work, and what happens to a contractor who builds ahead of a formal change order during a funding lapse.
The rule is simple to state and easy to get wrong in practice. A contracting officer's informal direction — an email, a verbal okay at a site meeting, a stop-work instruction that never gets paperwork — is not the same as an executed change order, and a contractor who proceeds on the informal version is building at its own financial risk. During a shutdown, the piece notes, contracting officers often go quiet or get furloughed entirely, leaving a contractor holding directions nobody can formally ratify.
For a New York contractor on any federally funded job — a VA medical center roof, a DOT-funded bridge, anything running through an agency like DASNY or the Port Authority with federal dollars mixed in — the lesson is procedural, not dramatic: get directed changes in writing, on the contract's own change-order form, before mobilizing labor or material against them. A verbal "go ahead" from a project officer who then disappears during a lapse in appropriations is not a basis for payment, and disputing it after the fact is slower and costs more than getting the signature first.
This is a contract-administration explainer, not legal advice — a contractor facing an actual payment dispute over directed changes should read its own contract's changes clause and talk to counsel before deciding whether to proceed or stop work.