Construction Forms & Contracts

Construction Forms and Contracts
by Craig Savage and Karen Jones-Mitchell

Contents (by category)

Accounting Forms

Purchase Order, 16

Fax Purchase Order, 18

Progress Billing, Time and Materials, 20

Progress Billing, Lump Sum Contract, 22

Time and Materials Billing Sheet, 24

Percentage Complete Invoice, 26

Job Invoice, 28

Contractor's Invoice, Pages 1 and 2, 30

Contractor's Invoice, Page 3, 34

Statement of Contract, 36

Statement, 38

Contract Statement, 40

Past Due Notice, 42

Hourly Labor Rates, 44

Cash Paid Out, 46

Project Account Summary, 48

Payroll Employee Summary, 50

Overhead Calculations,

Equipment Ledger Sheet, 54

Expense and Travel Report, 56

Final Payment Release, 58

Time and Material Log, 60

Accounting Adjustments, 62

Profit and Loss Statement, 64

Contracts

Proposal, 70

Remodeling Proposal, 72

Fixed Fee Itemized Proposal, 76

Time and Material Proposal, 78

Time and Material Itemized Proposal, 80

Subcontract Agreement, 82

Subcontract Policy, 84

Prime Construction Contract, 86

Project Management Contract, 88

Cost Plus Percentage Contract, 94

Cost Plus Fixed Fee Contract, 98

Contract Transmittal, 102

Change Order - Generic, 104

Change Order - Running Total, 106

Subcontractor Change Order, 108

Cash Change Order, 110

Fax Change Order, 112

Change Transmittal, 114

Change Order Log, 116

Warranty, 118

Estimating Forms

Plan Log, 122

Bid Log, 124

Job Survey, 126

Quantity Sheet, 128

Quotation, 132

Telephone Quotation, 134

Fax Quotation, 136

Bid Form, 138

Letter - Bid Follow Up, 140

CSI Estimator, 142

Estimate Checklist, 156

Unit Estimate Sheet, 170

Unit Estimate Sheet (Additional), 173

Estimate Recap Sheet, 174

Summary of Estimate, 176

FHA Cost Breakdown, 178

Cost Data Form, 182

Cost Book, 186

Historical Project Cost Sheet, 190

Field Forms

Job Information, 194

Finish Schedule by Room, 198

Specialty Selection Sheet, 200

Schedule Sheet, 202

Job Progress Chart, 204

Daily Construction Report, 206

Daily Work Sheet,

Daily Material Report, 210

Material Requisition, 212

Daily Equipment Report, 214

Weekly Equipment Summary, 216

Tool List, 218

Tool Receipt, 220

Truck Inspection Sheet, 222

Field Problem Report, 226

Field Change Report, 228

Subcontractor Work Order, 230

Delay Notice, 232

Memorandum of Delay, 234

Potential Backcharge Notice, 236

Accident Report by Supervisor, 238

Safety Meeting Report, 240

Job Site Safety Checklist, 242

Safety Agreement, 246

Project Closeout Checklist, 248

Project Closeout Letter, 252

Final Project Punch List, 254

General Office Forms

Interoffice Memo, 258

Memo, 260

Fax Cover Sheet, 262

Transmittal From, 264

Emergency Telephone Directory, 266

Field Directory, 268

Office Directory, 270

First Contact Sheet, 274

Contractor/Supplier Questionnaire, 276

Questionnaire Cover Letter, 278

Subcontractor Insurance Verification Log, 280

Rejection Letter, 282

Deficiency Notice, 284

Time Management Worksheet, 286

Project Startup Checklist, 288

Material Schedule, 292

Job Cost Report, 294

Procurement Schedule, 296

Specification Change, 298

Employee Data Sheet, 300

Driving Record Verification, 302

Employee Evaluation, 304

Employee Time Card, 306

Unit Cost Time Card, 308

Employee Time Sheet, 310

Time Card - Categorized, 312

Time Card Categories, 314

Weekly Time Card, 316

Preliminary Notice, 318

Waiver of Lien (Partial), 320

Material or Labor Waiver of Lien, 322

Nonresponsibility Notice, 324

Thank You Letter, 326

Customer Satisfaction Survey, 328

Company Evaluation, 330

Installation Instruction, 333

Index of Programs, 337

Index, 396

Construction Forms & Contracts
by Craig Savage and Karen Jones-Mitchell

Introduction

Give a contractor three wishes and you'll probably get three requests:

1. Just leave me alone and let me do my work.

2. Pay me when my work is done.

3. Save me from all this paperwork!

Between us, we've got 40 years as contractors under our belts. We know how you feel. And we agree, especially with the third request. Paperwork never built anything. In fact, paperwork keeps you from building. It inflates your overhead, drains away the valuable time of key people and increases the complexity of what's way too complex already.

So, you ask, why would any construction contractor want Construction Forms & Contracts? That's easy. We'll explain.

Think about it for a minute. Exactly why do you hate paperwork?

When we ask that question at seminars and trade shows, we get all the obvious answers. There are probably as many good reasons to hate paperwork as there are construction contractors. But nearly all come down to one point:

It's a waste of time.

So why do it? Glance at the top of this page again. Read the first two requests on every contractor's wish list: Remember "Let me build!" and "Pay me on time!" That's why you do paperwork. You're never going to get either wish until the paperwork is done.

This book addresses Wish 1 and Wish 2 by simplifying and systematizing Wish 3. That's our point in a nutshell. You'll have more time for productive work and get paid sooner if paperwork stops being a burden and becomes a breeze. That's the purpose of this book.

If you don't believe that paperwork can be simplified, keep reading. You're in for some surprises.

True enough, this is a book of forms. Nearly every contract and form you're going to need is here ready for reproduction on your copy machine. We've developed these 125 forms for our own company and have used them for many years. They're good. They're complete. They're going to save you time day after day. By themselves, they're worth the price of the book.

But that's just the beginning if you have:

• A computer with a CD-ROM drive
• A printer.

With that combination and the disk inside the back cover of this book, you're going to be a paperwork wizard. With any of the modem spreadsheet or word processing programs, you can open these forms on your screen and customize them to fit your needs exactly:

• Change the column headings or row widths.
• Add your company name and address.
• Delete what doesn't suit your operation.
• Add whatever you feel is missing.

If you know how to use any of the popular word processing or spreadsheet programs, you'll have no trouble using the forms disk in the envelope in the back of this book. Beginning on page 333 you'll find instructions for loading and using the forms with any of the popular word processing or spreadsheet programs. Even if you don't have a word processing or spreadsheet program, you'll be able to open these forms, make changes on the screen, then print the revised form on your printer.

What's the Advantage to You?

Just like a nail gun automates nailing, this disk is going to automate your paperwork.

Your time will be the biggest saving. But you'll save money, too. The cost of duplicating forms yourself is peanuts compared to the cost of custom-designed forms purchased from a forms vendor. Expect savings of at least several hundred dollars a year.

In short, your company is going to have the most professional, easiest to use, most complete set of accounting, estimating, contracting and field reporting forms available anywhere.

Why You Need Good Forms

Most construction tradesmen learn by watching others. For example, apprentice carpenters learn to set a nail before driving it. But for many, it takes a good whack on the thumb to bring the lesson home. Painful mistakes can be the best teachers.

It's the same way with construction contracting. The most painful lessons are sometimes the best teachers. Verbal change orders are my favorite example. "Do it now at any cost." has a way of becoming "I didn't authorize that change," The lesson? Having the right change order form available at the right time can save you thousands.

Here's another example. Until your first workers' compensation audit, you probably didn't understand the importance of good payroll records. Afterwards, you'll never forget. Another painful lesson learned: Find and use good time cards and payroll ledgers.

We could go on and on. But we're sure you're getting the point. Most mistakes in the construction contracting business teach the same lesson: Either use good forms and keep good records or get out of the business.

Why Care About Forms?

We can think of at least five great reasons to use the forms in this book. Test yourself. See how many of these reasons make sense to you:

1.Good forms protect your company.

For example, collecting for extra work is a sore point with most of the construction contractors we know. Make it your policy that no extra work is started without a signed change order. A signed work order leaves no wiggle room when it comes time to get paid.

Consider making a written purchase order part of your procurement process. That should eliminate bills that exceed the quoted cost.

2. Good forms give your business a professional image.

A good paint job makes your finished product look great. Good forms, embellished with your company logo, give your business a sharper image and a real competitive advantage. They put you in the major leagues with construction professionals who know the importance of making the best, possible presentation.

Some contractors can make a living writing estimates on the back of business cards and scratching out bills on napkins. But you're never going to make it that way with professional business people. It just isn't done. The people you want as clients are accustomed to professional business practice. That means you have to use good quality forms.

Clients who get an estimate, a proposal, a change order and progress billings on forms created in the same style know that you've got your act together. Good professional forms imply a real permanence to your business. Your company is more than a pickup truck and an answering machine. It's a quality, professional operation.

Few clients will ever see your office. But nearly all will see the contracting, estimating or accounting forms you use. Many will judge your competence (at least initially) by the quality of the paperwork you provide. Don't disappoint them.

3. Good forms, used properly, create order where there had been construction chaos.

Forms reduce errors and oversights. They force you to list, schedule, record, deduct, add, and follow procedures and checklists. That creates consistency and accountability. It extends your direct control to everyone in your company. No creativity is required. Just follow instructions on the form and everything will fall into place. Forms make automatic what might otherwise require regular supervision.

4. Forms create a paper trail showing what happened and when.

Your forms create a permanent record that's available weeks, months or even years after the fact. That makes it harder for others to shift blame or legal responsibility onto your shoulders. The higher the value of the work you do and the greater your work volume, the more important good records will become.

5. Finally, good forms level the playing field.

The contract form you use does make a difference. We've seen "standard" contracts so one-sided that no builder could make a dime. There's no reason why every dispute has to be resolved in favor of an owner. Don't get suckered into signing contracts like that. Offer to provide your own contract forms - the forms in this book. They're fair and reasonable.

125 Essential Forms

The forms you find here are those most commonly needed in a construction office. For your convenience, we've divided them into five major categories:

1. Accounting

2. Contracts

3. Estimating

4. Field

5. General Office

Each form is accompanied by a description of how the form should be filled out and used. We feel that this description is just as important as the form itself.

Not every form will be precisely right for every company. In some cases, we've provided several forms that serve the same general purpose. You'll have to decide which form fits your operation the best. For example, there are four time cards. Read the summary that accompanies each time card to determine which one of the four is best for your operation.

Some forms may not apply to your business at all. Others may not be appropriate at this time. Don't feel like you need to use a form just because it's here.

The balance between too much paperwork and too little is a matter of personal preference. Our inclination is to use too many forms rather than too few. If the living room is painted the wrong color and the kitchen is flat instead of gloss, you've got a fight on your hands. That's too late to have a client initial a color schedule for the paint contractor. It's much cheaper and easier to give the right form to a client and then pass that form to your paint subcontractor. Take that little step. Put your form to work. Lock down the colors and textures and save yourself the grief.

Construction Forms on Paper

If you don't have a computer, make form copies with any copy machine. Just slap the form you need down on the copier and copy away. Most forms intended for use out of your office have a place for your company name, address and phone number. Before running off any copies, paste your business card in the place reserved for your name and address.

A thick business card can create a shadow line around the card on each copy. If that happens, copy your business card onto thinner paper and paste that copy on the master. If you still get a shadow line, reduce the copier's contrast adjustment slightly. If that doesn't eliminate the problem, try painting white-out fluid around the edges of the pasted-on piece. Eventually you'll get usable results.

Some of the forms can be partially filled out before they're copied. Enter information that stays constant from job to job before you do any duplication.

The forms in this book should reproduce reasonably well on any good copier. Experiment with the contrast control and alignment to get best results.

Print quality will be better if you cut the form out of this book and give it to an instant printer for duplication. Be sure to add your business name and company logo to the form. Or select a printer who will set type for your company name and address at no cost.

Those forms most likely to be filled out with a typewriter have spacing that works correctly with the standard carriage return on most typewriters. Forms intended for use in the field (such as checklists and time cards) have larger spaces between lines. There's enough room for writing with a carpenter's pencil or keel marker. Fax forms have been stylized for easy reading once they're transmitted.

Once you've made copies of several forms, organization will be important. We suggest dedicating one file drawer for storage of blank forms. Put one manila folder in this drawer for each form you plan to use. Label these file folders with the form name and put the folders in alphabetical order. Storage in a file drawer keeps these forms readily available at all times.

Construction Forms on Disk

If your company is one of the growing majority that have joined the computer revolution, the disk in the envelope inside the back cover will be more valuable than the tree that had to be destroyed to put this sheaf of paper in your hand.

Each of the forms in this book is on the disk - in eight formats. Why put each form on disk eight times? Easy. Because the nerds who write computer programs haven't adopted a uniform method of storing graphics on disk. To be reasonably sure that you can use these forms, our publisher created eight versions of each form. The version you use depends on the word processing or spreadsheet program you prefer. Here are the eight versions you can select from:

• Excel if you use Microsoft Excel, Quattro Pro, or Claris Works for Windows.
• Word for Windows if you use any version of Microsoft Word.
• WordPerfect if you use WordPerfect 5.1 for DOS, WordPerfect for Windows, AmiPro 3 for Windows or Lotus Word Pro for Windows.
• Lotus 1-2-3 if you use Lotus 1-2-3 for Windows.
• Works if you use Works for Windows.
• ASCII if you use DOS and don't have Windows.
• Excel for Mac if you use Microsoft Excel for the Macintosh.
• Word for Mac if you use Microsoft Word for the Macintosh.

You can reproduce these forms (on your printer) just the way they look in the book. Even better, you can customize each form so it meets your needs exactly. Cut out what you don't need and paste in what's required to make the form perfect for your company. The more capable your word processing or spreadsheet program, the more you can do.

You should have no trouble redesigning any of these forms to fit your style of doing business. Try importing your company's logo or letterhead and pasting it on several of the forms - creating instant stationery that's available whenever you need it.

Having the forms on computer means that you can print small quantities when only small quantities are needed. The savings in printing and storage costs will be substantial. When your address or phone number changes, modify the form in a minute or two, not after using up the last of that 5000 print run. And if you want to look like a remodel company to some clients and a custom home builder to others, it's a cinch to change the form and print a few dozen copies of each form type.

Each of the forms is stored on disk as a single file. But you may prefer merging several forms into one larger file that prints as a single document. That's handy when the same forms are needed every time you start a new job. If you have one of the more capable word processing or spreadsheet programs, consider merging the forms on your hard disk in the order you'll need them:

• Preliminary Job Survey first
• Proposals next
• Billings, etc.
• Finally, the client questionnaire that's sent at the end of the job

Using a combination of computerized custom forms and copied standard forms will probably be most efficient. For example, create a customized master time card with your favorite word processing or spreadsheet program. Print one copy with your laser or ink jet printer. Then run off lots more with any copy machine.

You'll print one-of-a-kind forms (such as contracts) only when needed and specifically for a particular job. The same will probably be true for invoices and progress billings.

A Word of Caution

We're not lawyers. We're construction contractors. The forms in this book haven't been reviewed for legal content and may not comply with laws in all states. Your best source of advice on the law will always be legal counsel familiar with the law in the communities where you do business.

Can't Use a CD?

The CD in the back of this book should work perfectly in any computer with a CD-ROM drive - whether that computer is a PC (using Windows or DOS) or a Macintosh. But what if you don't have a CD-ROM drive? One answer is to copy the forms you need from the CD to a disk that fits your computer. All you need is the help of a friend who has a computer with a CD drive. And if that won't work? Call Craftsman at 1-800-829-8123 and ask for the 31/2" disk you need, either for a PC or a Mac. The cost is $10.

Construction Forms and Contracts
by Craig Savage and Karen Jones-Mitchell

Nearly every contract and form you're going to need is here ready for reproduction on your copy machine. The authors are construction contractors and have used these forms for many years. They're good. They're complete. They're going to save you time and money day after day. By themselves, they're worth the price of the book. But that's just the beginning if you have a computer and a printer.

With that combination and the CD inside the back cover of this book, you're going to be a paperwork wizard. You can lay these forms open on your computer screen and customize them to fit your needs exactly:

• Add your company name and address
• Add whatever you feel is missing
• Delete what doesn't suit your operation
• Change the column headings or row widths

If you know how to use any of the popular word processing or spreadsheet programs, you'll have no trouble using the disk included. Even if you don't have a word processing program, you'll be able to use these forms on your computer. Full instructions in the book explain how to open and use any of these forms:

• Estimating forms, checklists, job and equipment logs and time sheets
• Contracts and change orders for remodeling, new construction and T&M jobs
• Progress billing sheets, purchase orders, time and material invoices
• Lien notices, time cards, cover letters, transmittals and memos

The compact disk has a version of all 125 forms exactly right for anyone who uses:

• Ami Pro 3.0 for Windows
• Lotus Word Pro
• WordPerfect 5.1 for DOS, & 6.0
• Claris Works 5.0
• NCU Edit for DOS
• Corel WordPerfect
• Excel for Windows 3.1, 95, NT & 98
• Corel Quattro Pro
• Works 3.0 for Windows 3.1
• Lotus 1-2-3 for Windows 3.1, 95, NT & 98
• Word 6 for Windows 3.1, 95, NT & 98
• Works 4.0 for Windows 95, NT & 98

No Word Processor or Spreadsheet Program Needed

If you don't have any of these programs, there's another version of all 125 forms that will work on any computer that operates on DOS, Windows or Mac systems. If you don't have a CD drive, a 3½" disk is also available.

Craig Savage is a contractor with over 30 years of construction experience and in appreciation for what the computer can do in the builder's office. In this book he draws on these skills to help builders with a marked dislike for paper-shuffling resolve the age-old dilemma of how to achieve the accurate, through records every business requires, while not spending the entire work week doing it.

Karen Jones-Mitchell has 15 years experience as a general contractor and finance consultant. Between her two careers, she's become a seasoned pro in building, in construction accounting, and in computers. Karen knows inside and out the special problems of construction record-keeping and construction offices. In this book she has combined that knowledge to help create the most user-friendly set of forms you've ever seen or used.