Agenda Item
a. Capital Project ~ Change Order Request and Budget Reallocation ~ Evergreen Construction - Capital Improvement Project #01530 for Early Learning Center ~ Change Order No. 3 ~ Final Payout (Not to Exceed $140,683.08) ~ Updated 7.8.2026
Summary: Presented by: Mr. Erick Hofstetter, Chief Operating Officer, Division of Operations and
Mr. Darrell Stallings, Chief of Capital Improvements, Division of Capital Improvements
Request: It is requested that the DeKalb County Board of Education approve:
Change Order No. 3 to Evergreen Construction for the Early Learning Center (#01530) HVAC & Controls Replacement Project that will be funded by the budget reallocation.
An E-SPLOST V budget reallocation in the amount not to exceed $140,683.08 from Program Contingency to the Local Capital Project Fund which will allow the proper funds to be allocated to the necessary project cost code for the Evergreen Construction Change Order No. 3.
Why: Approval of the budget reallocation and Change Order No. 3 will provide necessary funds for the settlement and closeout of outstanding Items of Change* (“IOC”) for Early Learning Center HVAC Controls Replacement Project & projects.
*Items of Change: refer to specific, documented alterations to the original project scope,, budget, or schedule, commonly formalized through change orders. These adjustments often result from unforeseen site conditions, design revisions, material substitutions, or owner-driven changes to the project requirements.
Details: At its business meeting on September 11, 2023, the DeKalb County Board of Education approved the award of RFP No. 23-752-026 to Evergreen Construction, for general contractor services for Briarlake Elementary School, Early Learning Center, Montclair Elementary School, Tucker Middle School for the lump sum amount of $31,921,000.
At its business meeting on November 11, 2024, the Dekalb Board of Education approved the Change Order #1 to Evergreen Construction for the Early Learning Center HVAC project in a not to exceed amount of $140,683.08. $344,416.20.
Pursuant to discussions with the Construction Manager and an internal evaluation of project records, DeKalb County School (DCSD) staff conducted a review of outstanding Legacy Change Order* requests associated with the Early Learning Center project. The review focused on (1) contractual entitlement for the work performed and (2) compliance with District authorization and change management procedures.
*Legacy Change Order: older items (change orders) that are unresolved past changes (outstanding or pending) from earlier stages of a project that were not finalized or approved that are essential for documenting adjustments to the project.
The review determined that portions of the work reflected in the CO requests were performed without advance written authorization by the Owner or a duly authorized representative of the DeKalb County School District (DCSD), and in certain instances without a fully executed change order prior to performance. This process deviates from the District’s standard construction contract requirements, which are consistent with AIA A201-2017 General Conditions and require that all changes in the work be applied.
Notwithstanding these procedural deficiencies, District staff’s analysis indicates that limited entitlement exists for certain portions of the work reflected in the IOC requests. To resolve these matters efficiently and in a fiscally responsible manner, staff recommend a negotiated compromise settlement.
These amounts represent a global settlement of all outstanding IOC-related issues for each project and are structured to:
Compensate only those costs for which a limited entitlement exists.
Preserve DCSD contractual rights and expectations for compliance, and avoid additional costs associated with prolonged claims analysis or litigation.
Approval of this settlement will allow the DCSD to close out outstanding IOC matters for these projects, maintain accurate financial records, and reinforce proper change order management practices going forward.
Financial impact: The total amount of $140,683.08 for Evergreen Construction Change Order No. 3 will be allocated from the general contractor cost code (F300CIP.01530.GENCONTR.5068) under the Local Capital Project Fund. A budget reallocation of $140,683.08 from program contingency is required to fund this settlement.
Contact: Mr. Erick Hofstetter, Chief Operating Officer, Division of Operations, 678-676-0168
Mr. Hans Williams, Dir. Planning & E-SPLOST Programming, 678-676-1588
Mr. Artis Johnson, Program Director, 404.790.8985
Effective: Upon Board Approval
Status: Approved by the Office of Legal Affairs
CHRONOLOGY OF THE AGENDA ITEM
Change Order -Settlement
Evergreen Construction
Early Learning Center ES HVAC Projects
Scope:
Approval of the Settlement and Final Payout to Evergreen Company - Change Order
No. 3 – Early Learning Center ES HVAC and Controls Replacement Project 01530
Background:
The following change orders were approved to Evergreen Construction:
• Change Order #1 - Early Learning Center HVAC project-Not to exceed
amount of $140,683.08. (Board approval - November 11, 2024)
• Change Order #2 -Early Learning Center HVAC Project – Not to
exceed $24,482.00
Review
Pursuant to discussions with the Construction Manager and an internal evaluation of
project records, DeKalb County School (DCSD) staff conducted a review of
outstanding Legacy Change Order* requests associated with the Early Learning
Center HVAC project. The review focused on (1) contractual entitlement for the
work performed and (2) compliance with DCSD authorization and Change Order
Management procedures.
Notwithstanding these procedural deficiencies, DCSD staff’s analysis indicates that
limited entitlement exists for certain portions of the work reflected in the IOC*
requests; to resolve these matters efficiently and in a fiscally responsible manner,
staff recommend the following negotiated compromise settlement amounts:
• Early Learning Center HVAC Project: $140,683.08
Resolution
Approval of this settlement will allow DCSD to close out outstanding IOC matters
for these projects, maintain accurate financial records, and reinforce proper Change
Order Management practices going forward.
*Items of Change (IOC): refer to specific, documented alterations to the original
project scope,, budget, or schedule, commonly formalized through change orders.
These adjustments often result from unforeseen site conditions, design revisions,
material substitutions, or owner-driven changes to the project requirements
*Legacy Change Order: older items (change orders) that are unresolved past
changes (outstanding or pending) from earlier stages of a project that were not
finalized or approved that are essential for documenting adjustments to the
project.