What costs can the Contractor include for handling materials or equipment after termination?

The correct answer highlights that the Contractor can include the reasonable cost of handling material or equipment returned to the vendor or disposed of in accordance with the City’s instructions. This option reflects an understanding of what costs are justifiable in the context of contract termination. Specifically, it recognizes that after a termination event, the Contractor must manage the remaining materials and equipment in a way that aligns with the contractual obligations or directives provided by the City.

This involves returning any materials to suppliers or properly disposing of them, which may incur additional costs. Therefore, it’s deemed reasonable for the Contractor to recoup those costs since they are necessary actions for concluding the contract and ensuring compliance with the City’s directives.

In contrast, other options do not meet the criteria of reasonable or necessary costs associated with handling equipment post-termination. For instance, claiming the total cost of all materials purchased during the contract does not take into account the fact that not all materials may need to be returned or disposed of and thus could lead to excessive and unjustifiable claims. Fixed fees for all equipment used in the project may not be applicable after termination, as the equipment might not be relevant anymore, and claiming such fixed costs could result in overbilling. Lastly, costs related to future storage of materials do