Blog Title
Published June 2021, Updated April 2023
Published April 2023, Updated September 2024
USACE Series Part 1: Schedule and Progress Payments
USACE Series Part 1: Schedule and Progress Payments
- USACE Schedule and Payment Requirements
- Role of USACE’s Cost-Loaded Schedule
- Importance of Schedule Compliance
In the first part of this series, we’re exploring the link between U.S. Army Corps of Engineers (USACE) construction schedules and progress payments.
It’s essential to understand this relationship, as non-compliant construction schedules may lead to withholding or retained payments by the government until the contractual requirements are met.
The interplay between progress payments affects both the contractor’s cashflow and the government’s supervision and administration (S&A) charges.
While construction contractors and government employees may have a high-level understanding of this relationship, this article aims to offer a comprehensive explanation and examples of how the schedule and progress payments interact with USACE construction contract administration and project management.
In the sections below, we cover:
- USACE Schedule and Payment Requirements
- Role of USACE’s Cost-Loaded Schedule
- Importance of Schedule Compliance
Published April 2023
USACE Series Part 1: Schedule and Progress Payments
In the first part of this series, we’re exploring the crucial link between U.S. Army Corps of Engineers (USACE) construction schedules and progress payments.
It’s essential to understand this relationship, as non-compliant construction schedules may lead to withholding or retained payments by the government until the contractual requirements are met.
The interplay between progress payments affects both the contractor’s cashflow and the government’s supervision and administration (S&A) charges.
While construction contractors and government employees may have a high-level understanding of this relationship, this article aims to offer a comprehensive explanation and example snapshots of how the schedule and progress payments interact with USACE construction contract administration and project management.
In the sections below, we cover:
In USACE projects, these two tools are combined into one: the cost-loaded project schedule.
The cost-loaded project schedule has costs distributed and assigned to the schedule activities. As the contractor performs the work and statuses the activities, progress payments are calculated based on the status and assigned costs for each activity.
USACE Schedule and Payment Requirements
In private sector projects, it’s common for contractors to use two separate tools for tracking project progress and payments: the schedule of values and the construction schedule.
Schedule of Values: Listing of all the work in the project along with their costs.
Construction Schedule: Activity table and/or network diagram that shows the sequence of work.
UFGS 01 32 17.00 20 Scheduling Specifications
UFGS 01 32 01.00 10 Scheduling Specifications
The cost-loaded schedule serves the following functions:
Determines Progress Payments: As the construction contractor performs the work and statues the schedule activities with government concurrence, the cost-loaded activities add up to total the progress payment amounts.
Provides Placement Projections: The cost-loaded schedule allows the creation of the S-Curve, a chart that captures earnings over time. The S-Curve visually shows the schedule’s overall cost distributions as well as placement projections.
Role of USACE’s Cost-Loaded Schedule
The cost-loaded project schedule serves as the basis for progress payments.
This is defined in the standard UFGS 01 32 01.00 10 (typically USACE) and 01 32 17.00 20 (typically NAVFAC) specifications as shown in the snapshots below.
UFGS 01 32 01.00 10 Scheduling Specifications
The contractor must also understand how the government utilizes Cost Line Item Numbers (CLINs) and how to balance the CLINs in the cost-loaded project schedule. This ensure a smooth schedule upload as a SDEF file into USACE’s Resident Management System (RMS) without issue.
Importance of Schedule Compliance
Since the schedule is tied directly to progress payments, the government can reject payment to the contractor or withhold if the schedule fails to comply with the requirements of the specification and contract.
If the contractor fails to submit a contract-compliant schedule, the government may withhold progress payments until the schedule is submitted, reviewed, and found to be compliant with the contract.
In the first part of this USACE series, we’ve explored the critical link between the construction schedule and progress payments.
- Instead of having a Schedule of Values and Construction Schedule as separate tools, USACE projects combine them into a single tool: the Cost-Loaded Project Schedule.
- The cost-loaded project schedule serves the following functions: 1) determine progress payments, and 2) provide placement (cost) projections.
If the contractor fails to submit a contract-compliant schedule, the government may withhold payment until it’s determined it meets the requirements.
Questions or comments? Reach us at connect@cpm-ss.com.
Thanks for reading.
Go to USACE Series Part 2: Schedule and Quality Control
Related Articles:
How to Balance CLINs in a MILCON Schedule
S-Curve from a Construction Schedule (with Examples)
New to USACE Schedules? 3 Things to Know
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This blog is for general informational purposes only and is not to be considered an official interpretation or enforcement policy of the UFGS standard specifications. As individual project requirements vary, refer to your specific contract. See our Terms and Conditions and Disclaimer for additional information.
This blog is for general informational purposes only and is not to be considered an official interpretation or enforcement policy of the UFGS standard specifications. As individual project requirements vary, refer to your specific contract. See our Terms and Conditions and Disclaimer for additional information.
Whenever you’re ready, there are 3 ways we can help you:
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USACE Series Part 2:
Schedule and Quality Control
USACE Series Part 1:
Schedule and Progress Payments
The Schedule of Values and Construction Schedule are combined into a single Cost-Loaded Project Schedule, used to determine progress payments and provide placement projections...
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