Brett Henson | Carlton Fields
Effective July 1, 2025, Chapter 2025-140, Laws of Florida, titled an “Act Relating to Construction Regulations,” enacted House Bill 683. This bill makes several changes to Florida’s construction laws, including requirements for “prompt processing” of change orders.
Prompt Processing of Change Orders
Florida’s Local Government Prompt Payment Act, described in Florida Statutes section 218.71, provides prompt payment procedures for local governments and establishes a dispute resolution process for contested payments. Section 2, Chapter 2025-140, Laws of Florida, adds to this statutory scheme by creating Florida Statutes section 218.755, requiring prompt processing of change orders requested by a local government from its contractor.
As context, the doctrine of sovereign immunity, as recognized by the Florida Supreme Court in County of Brevard v. Miorelli Engineering Inc., generally prohibits oral or implied changes to a contract between a governmental entity and a contractor, and instead requires an express, written change order. Consequently, public construction contracts typically include provisions for a public owner or its agent (e.g., architect or engineer) to request written changes in the work via change order. Change order provisions often prescribe the contractor’s method of pricing changes in the work (e.g., lump sum, cost of the work plus an agreed-upon percentage, or unit costs). Owner change order requests may require the contractor to estimate the requested extra work, the pricing of which can involve additional and potentially unreimbursed costs to the contractor. However, most public owner-contractor agreements permit (but do not obligate) a public owner to accept a requested change order if priced by the contractor. Further, even when a contractor has submitted a proposal in response to a change order request, such change orders do not become effective until mutually executed by the public owner and the contractor. Local government bodies may delegate authority to government staff for approval of change orders up to a certain dollar threshold, but absent such delegated authority, approval must occur at a public board meeting.
Against this backdrop, section 218.755 seeks to eliminate the cost burden on contractors for public owner-requested (but unapproved) change order by imposing a change order processing requirement that is analogous to the pay request process under Florida’s Local Government Prompt Payment Act. Local governments are now required to provide written notice to a contractor either approving or denying a price quote meeting all statutory and contractual requirements within 35 days of receipt in response to a requested or issued change order.
If the local governmental entity denies the received price quote, it must specify the alleged deficiencies in the quote and the actions necessary to remedy those deficiencies. Importantly, if the local governmental entity fails to provide the contractor with written notice either approving or denying a received price quote, the price quote and the corresponding change order are deemed approved, and the local governmental entity must pay the contractor the amount stated in the price quote upon completion of the change order work.
Section 218.755 also prohibits local governments from altering, via contract, its prompt processing provisions for change order requests. These provisions apply to contracts for construction services entered into on or after July 1, 2025.
While section 218.755 is situated within the Local Government Prompt Pay Act, its prompt processing provisions differ from the prompt payment provisions in section 218.735 in at least one material respect. Unlike section 218.735(2), which defines the date of receipt for an invoice or payment request as the date on which it is stamped as received, section 218.755 includes no such reference. As such, local governments might consider defining when a price quote is deemed received, either by contract or local ordinance. In doing so, local governments should be careful not to impose any requirements that could be construed to alter (e.g., extend or prolong) the 35-day deadline for acceptance or rejection in section 218.755. As a starting point, local governments might look to their already established procedures “whereby each payment request or invoice received by the local governmental entity is marked as received” to reflect receipt of the price quote, as described in section 218.74(1).
Local governments should also ensure they have an internal process for escalating received price quotes so that any price quotes that exceed the scope of approval authority delegated to government staff (if any), can be considered by the governing board at a duly noticed public meeting. Florida’s Government-in-the-Sunshine Manual recommends providing at least seven business days’ notice for regular meetings and between 24 to 72 hours for emergency or special meetings. If a local governing body is unable to consider a contractor’s price quote at a regular meeting, it should consider convening a special meeting for this purpose.
Finally, in submitting price quotes, contractors should ensure compliance with contractual requirements for change order pricing. For instance, contractors should avoid submitting lump sum price quotes where only cost-plus quotes are permitted, and ensure price quotes based on unit prices correspond with any such amounts stipulated by contract.
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