The Oklahoma Bar Journal October 2026

These requirements protect public funds by ensuring work is properly completed before payment, preserving the municipality’s ability to require corrections, and creating a clear record that reduces disputes, claims, and audit risks.

these limits are exceeded, the munic ipality must readvertise for bids on the remaining incomplete work. Delegation Authority Change orders must be formally approved by the municipality, and the reasons for approval must be recorded in the perma nent records. A municipality may delegate approval authority for change orders of up to $40,000 or 10% of the contract amount, which ever is less, provided that any such approved change orders are reported to the governing body at the next regular meeting. 58 claim procedures are mandatory and help limit disputes, prevent surprise damages, and protect pub lic funds, particularly for change orders and extra work. A contractor who fails to properly submit or itemize claims as required cannot later expand those claims in court. 59 Importance of Detailed Procedures Clear, consistently enforced

supervising architect, engi neer, or designated official that the work complies with project requirements, and no pay ment may be made without it. Interim payments do not waive performance obligations, and final payment requires a sworn contractor certification of full compliance with the contract and specifications. 57 These requirements protect public funds by ensuring work is properly completed before pay ment, preserving the municipali ty’s ability to require corrections, and creating a clear record that reduces disputes, claims, and audit risks.

progressing satisfactorily, retainage must be reduced to 2.5%. A contrac tor may, however, withdraw retained funds by depositing approved secu rity with the municipality. 54 These retainage rules protect the public entity’s interest in proper completion while avoiding unnec essary financial strain on contrac tors, encouraging steady progress, competitive bidding, and timely project completion. Interest on Late Payments Unpaid final payments accrue interest at 1.5% per month. Interest begins 30 days after completion and acceptance for lump-sum con tracts and 60 days after for unit price contracts and is suspended during any dispute over final quantities or payment amounts. 55 completed, the municipality must inspect the work and may approve payment only after the required inspections confirm compliance with the plans and specifications. 56 Invoices for payment must include certification by the Inspections and Certifications Before accepting a project as

CHANGE ORDERS AND CLAIMS

Change Order Caps Change orders are subject to

limits based on the original amount. If the original contract is $1,000,000 or less, total change orders may not exceed a 15% cumulative increase. If the original contract exceeds $1 million, total change orders may not exceed the greater of $150,000 or 10% of the original contract amount. If

Statements or opinions expressed in the Oklahoma Bar Journal are those of the authors and do not necessarily reflect those of the Oklahoma Bar Association, its officers, Board of Governors, Board of Editors or staff.

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THE OKLAHOMA BAR JOURNAL