Feds Bar Retroactive Hikes For Steel Price Increases
Highway contractors slammed by sharp increases in steel prices suffered another blow when the Federal Highway Administration said it cannot approve surcharges on already issued contracts. Some in industry now are looking to Congress for help.
In an April 9 e-mail message to field offices, King Gee, the agencys associate administrator for infrastructure, said FHWAs chief counsels office had determined that "we are legally prohibited from approving the use of federal funds for retroactive price adjustments in existing contracts." Gee added that FHWA does not object to states adding retroactive price clauses if they are using only state funds and their own laws permit it.