Greetings from DCAMM Contractor Certification!
In this tip sheet we will be discussing the how to calculate the Aggregate Work Limit.
Calculating your Aggregate Work Limit
Have you ever wondered how your Aggregate Work Limit is calculated? Here is how it is done.
The Aggregate Work Limit is based on a calculation that takes into account your highest consecutive twelve-month volume of work. The highest consecutive twelve-month volume of work can be verified by a CPA prepared Financial Statement. If the highest twelve-month volume of work does not coincide with a fiscal year, it may be verified by a CPA letter. In order to enable contractors to maintain the highest Aggregate Work Limit possible, DCAMM will allow the highest twelve-month volume of work to start outside of the lookback period, so long as the end date is within the five-year lookback period. Once the highest twelve-month volume of work is verified, a multiplier is applied to calculate the limit. The multiplier is determined by your Overall Numerical Rating (ONR), which is a combination of your Average Project rating and other factors. See page 15 of the Guidelines for full details on the ONR. If your ONR is 80 to 84 you get a 1.3 multiplier. If your ONR is 85 to 100 you get a 1.8 multiplier.
Limits are Subject to Capping
Keep in mind that Aggregate Work Limits are subject to capping.
The Aggregate Work Limit on your bonding letter will cap your calculated Aggregate Work Limit.
Small Prime Contractors have an Aggregate Work Limit that is capped at $1,000,000.
Your Single Project Limit can never be higher than your Aggregate Work Limit. The Single Project Limit will be capped by the Aggregate Work Limit if the Aggregate Work Limit is lower.
Other Factors to Consider
Certificates can be amended to increase your limits at any point during your certification period. In order to increase your Aggregate Work Limit you would have to submit either a higher consecutive twelve-month volume of work as verified by your CPA or a new bonding letter with higher limits if your Aggregate Work Limit is currently capped.
Stay tuned for the next installment...
If you have any questions do not hesitate to contact Certification at 857-204-1305 or certification.DCAMM@mass.gov.
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Reminder: Applications are due 90 days prior to expiration for the current certificate.