Chapter 2 – Fiscal Management

22040.12 Execution of Contract

• A fully executed contract shall have original signatures of the contractor, the CMBSee Office of Business Services (OBS) manager, DGSDepartment of General Services, or other approving authority. Contracts must also be approved and released within the SAP program.

• Under no circumstances can a contractor commence services before a fully approved and executed contract is received by the contractor. However, under an emergency situation work may begin without an executed contract if the contract has been verbally authorized by someone with Department authority to authorize the initiation of an emergency contract. (See DOMDepartment Operations Manual § 22040.5) Backdating of a contract is prohibited.

• The risks associated with a contractor commencing services without an executed contract include:

  • Inability of the State to hold the contractor accountable for poor, insufficient, or incomplete work;

  • Inability to pay the contractor for work performed;

  • A possible 15 percent penalty fee of the total costs of claims filed against the Department with the Victims Compensation Government Claims Board added to the total cost of the claim and charged to the program; and

  • Potential loss of qualified contractors for future work.