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OVERHEAD As percent of direct costs... minimum = 5% <br />average = 13% <br />maximum = 30% <br />OVERHEAD & PROFIT (by project size)... under $100,000 project= 30% <br />$500,000 project= 25% <br />$2,000,000 project= 20% <br />over $10,000,000 project= 15% <br />1. Liability insurance <br />The "General Conditions" section of most government construction contracts requires <br />that the successful bidder obtain adequate public liability insurance. To account for <br />this expense, DMG utilizes data from MEANS Site Work & Landscape Cost Data, <br />Administrative Requirements Section - Project ManagemenVCoordination — Average <br />public liability insurance - expressed as a percentage of job cost. <br />EXAMPLE: In the 2006 edition of MEANS Site Work and Landscape Cost Data, the <br />average public liability insurance expense is listed at 2.02% of job cost. For a <br />reclamation project with an estimated total direct cost of $100,000, the contractor's <br />liability insurance expense will be $2,020. <br />2. Performance bond <br />Although the main objective of preparing a reclamation cost estimate is to determine <br />the total amount of reclamation bondto be held by the regulatory authority, be aware <br />that whenever a reclamation bond is actually forfeited and the agency contracts with a <br />construction company to perform the work, the General Conditions section of the <br />contract usually requires that the contractor obtain a different type of bond known in <br />the construction industry as a performance bond. The performance bond is essentially <br />a guarantee by a bank or bonding company to the project owner (e.g. DMG) that all <br />work will be completed in the event the contractor fails to perform per the terms of the <br />contract. In some cases, a labor & materials payment bond may also be required. <br />To account for this expense, DMG utilizes data from MEANS Site Work & Landscape <br />Cost Data, Administrative Requirements Section - Project ManagemenVCoordination — <br />Performance bond - expressed as a percentage of job cost. <br />EXAMPLE: In the 2006 edition of MEANS Site Work and Landscape Cost Data, the <br />average performance bond expense is listed at a minimum value of 0.62% of job cost <br />and a maximum value of 1.50%. This works out to an average value of 1.06 %. For a <br />reclamation project with an estimated total direct cost of $100,000, the contractor's <br />performance bond expense will be $1,060. <br />3. Job superintendent <br />State & Federal construction contracts often require that the contractor keep a job <br />superintendent on site at all times work is being performed. For small projects <br />involving a simple sequence of tasks where each task can be performed by one piece <br />of equipment, the equipment operator can sometimes double as job superintendent <br />M <br />