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Project Completion and Close-Out

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Tasks and Deliverables

  1. Coordination of Systemwide Insurance Program Coverage
  2. Receive Closeout Documents and Warranties
  3. Achieve Substantial Completion for All Phases of Construction
  4. Removal from the Capital Improvement Program
  5. Disposition of Remaining Funds
  6. Capitalization of Assets
  7. Monitor Defects and Warranties

Tasks and Deliverables

1.    Coordination of Systemwide Insurance Program Coverage (Back to Top)

At least two weeks prior to an anticipated Substantial Completion (including Partial Substantial Completions), notify the Office of Risk Management (ORM) of the pending Substantial Completion milestone to discuss potential Builder’s Risk termination and adding the facility to The UT System’s Comprehensive Property Protection Plan (CPPP) insurance policy.  Be sure to include ORM in the distribution of the issuance of the Certificate of Substantial Completion.

ORM and the Project Manager should discuss options for terminating/extending the BR coverage in light of anticipated project activity, such as amount and nature of work not yet accepted and/or high risk activity at the project site (HVAC, plumbing, electrical, etc.). Upon termination of Builder’s Risk coverage, ORM adds the facility (or portions of the facility) to the Comprehensive Property Protection Program schedule, and responsibility for property insurance on the facility is transferred to the institution.

2.    Receive Closeout Documents and Warranties (Back to Top)

Prior to substantial completion, the institution should receive all required closeout documents and warranties from the contractor as per the contractual agreement.

3.    Achieve Substantial Completion for All Phases of Construction (Back to Top)

Substantial Completion is defined as the date determined and certified by Contractor, A/E, and Owner when the Work, or a designated portion thereof, is sufficiently complete, in accordance with the Contract, so as to be operational and fit for the use intended.  Projects with multiple phases of construction may have multiple Substantial Completion dates related to various scopes defined in the construction contract.  

4.    Removal from the Capital Improvement Program (Back to Top)

Once a project achieves Substantial Completion for the last phase of construction, the project will be removed from the Capital Improvement Program.

5.    Disposition of Remaining Funds (Back to Top)

After reconciliation, the disposition of remaining funds is determined according to the type of funds remaining as outlined in the UT System Capital Expenditure Policy.  Debt funding must be fully expended and/or transferred so that the project can be closed. If remaining RFS or TRB funding is not yet issued, then the authorization simply lapses. However, if remaining RFS or TRB funding is already issued and debt proceeds are on-hand, then those proceeds are either used by the Office of Finance to pay debt service, or they are moved to another fully-authorized Project (with necessary institutional, BOR and/or legislative approval). Remaining PUF funding simply lapses, unless the Chancellor approves moving the funds to another BOR-approved PUF Project. Remaining Institutional Funds are returned to the originating source of the funds.

6.    Capitalization of Assets (Back to Top)

Construction in progress assets are capitalized to the appropriate capital asset categories at the earliest occurrence of

a.    execution of substantial completion contract documents;
b.    occupancy; or
c.    placement of the asset into service.

7.    Monitor Defects and Warranties (Back to Top)

Unless otherwise specified or agreed, standard UT System construction contracts require the contractor to repair all defects in materials, equipment, or workmanship appearing within one year from the date of Substantial Completion of the Work. If Substantial Completion occurs by phase, then the warranty period for the Work performed for each phase begins on the date of Substantial Completion of that phase, or as otherwise stipulated on the Certificate of Substantial Completion for the particular phase.