How Do You Know an Architecture Project Is Over Its Fee Before It’s Too Late?

Why construction administration runs past its fee

Construction administration is paid one way and spent another. North Carolina’s standard owner–designer agreement for state projects, form OC-22 revised July 2026, is a public example. It pays 25% of the basic fee during construction, “monthly in proportion to the progress of the work,” and 5% more at closeout. The same form has the designer inspect the work “not less than once per week while work is in progress” and hold a monthly meeting throughout construction. The fee follows the contractor’s progress; the hours follow the calendar. When construction runs slow or long, the weeks keep coming and the fee does not.

The AIA form ties the work to the contractor’s calendar too. Under B101–2017 Section 3.6.1.3, construction-phase services run from the award of the construction contract to the architect’s final Certificate for Payment, a date the contractor’s pace sets. Site visits happen “at intervals appropriate to the stage of construction” unless the agreement sets a number (Section 3.6.2.1).

GAO’s guide calls work tied to the passage of time “level of effort,” a subjective measure of earned value, and says programs that report a high amount of it “are not providing objective data.” Much of construction administration works that way, so a percent complete for CA says little. Counts say more, and the hours land in places like these:

• Construction running past its completion date: more weekly visits, monthly meetings and pay applications.
• Submittals reviewed more times than the fee assumed.
• Requests for information the contractor could have answered from the documents.
• Change orders that need the contractor’s pricing evaluated or the drawings revised.
• Substitutions proposed by the owner or the contractor, and the revisions that follow.
• Closeout: the punch list, record drawings and final paperwork, after the building is occupied.

In the standard B101, Section 4.2.2 treats requests for information of that kind, change orders that need evaluation, substitutions, out-of-sequence submittals and an extensive number of claims as Additional Services the architect provides to avoid delay, with notice to the owner, who may stop them in writing and pays for what was provided before that notice. Owners edit this: the University of Wisconsin System’s public copy of B101–2017 deletes Section 4.2.2 entirely. Which list applies is in the signed agreement.

Budget construction administration from counts, and write the counts into the agreement

A construction administration budget set as whatever is left after design is a guess. Build it from counts before the proposal goes out, then write the counts into the agreement so they become limits someone can watch.

The standard B101–2017 has room for them. Section 4.2.3 leaves blanks for the number of reviews of each submittal, site visits, and inspections for substantial and final completion; work beyond those limits is an Additional Service, and the architect notifies the owner when a limit is reached. Section 4.2.4 sets a date limit: construction-phase services provided more than 60 days after substantial completion, or after the substantial completion date first set in the owner–contractor agreement if that comes earlier, are Additional Services to the extent the architect incurs additional cost, except work still within the Section 4.2.3 counts. On a late job, the clock starts from the date in the construction contract. Section 4.2.5 makes the architect’s services Additional Services once they run past a stated number of months from the agreement’s date, through no fault of the architect.

Public owners write their own versions. North Carolina’s OC-22 lists, among additional services the owner may request in writing, “contract administration and inspection of construction should the construction contract time be extended due to no fault of the Designer.” The University of Wisconsin System’s copy of B101 changes 60 days to 90 and “shall” to “may.” What a clause means on a given project is a question for the firm’s attorney. The counts, each a number times hours:

• Weeks of construction, from the owner’s schedule or the contractor’s bid duration, times site visits per week, times hours per visit with travel and the field report.
• Owner–architect–contractor meetings for the same months, times hours each.
• Monthly pay applications to review and certify.
• Expected submittals, times reviews each, times hours per review; expected requests for information, times hours each.
• Inspections for substantial and final completion, the punch list, closeout documents and record drawings.
• Consultants’ construction-phase fees, from their own proposals.

Illustrative example: a 14-month build, about 60 weeks. One site visit a week at 5 hours is 300 hours; 14 meetings at 4 hours, 56; 14 pay applications at 2 hours, 28; 150 submittals at about 2 hours each including resubmittals, 300; 80 requests for information at 2 hours, 160; inspections, punch list and closeout, 100. That is 944 hours, or $141,600 at a hypothetical $150 an hour. If the fee set aside $120,000 for the phase, the budget was $21,600 short before the contractor mobilized. If construction then runs three months long, 13 more visits, 3 more meetings and 3 more pay applications add about 83 hours, close to $12,450, unpaid unless the agreement says what happens. The numbers are invented.

The weekly report a project manager should see

One page per project, ready Monday morning, built from time posted through Friday. Hours entered two weeks late make the report two weeks late, so the first rule is time entry by the end of each week. The project manager fills in percent complete and the hours to finish; the principal reads the flags. One line per phase:

• Phase fee and hours budget, from the agreement and any signed amendments.
• Hours this week and to date, and fee spent at the rate the fee was built on.
• Percent complete, with its basis in a few words; fee earned; earned minus spent.
• Hours to finish the phase, and the projected total against the phase fee.
• Open additional-service requests and unsigned amendments, with dates and amounts.
• For construction administration: weeks used against weeks assumed, the forecast substantial completion date against the contract date, and visits, submittal reviews and requests for information against the counts in the agreement.

Three flags go to the principal: spent ahead of earned for two weeks running, a projected total over the phase fee, and any construction-phase count past its limit. GAO’s guide calls the ratio of earned to actual the cost performance index, where a value under 1.0 means “the work accomplished cost more than planned,” and notes that negative cost variances “are predictive of a final cost overrun if performance does not change.” In the example above, $33,000 earned on $45,000 spent is about 0.73. A spreadsheet fed by the weekly time export is enough to start.

When a phase is over: change the scope, bill the service, or absorb it on purpose

Find the cause before choosing the answer. Sort the hours over a phase budget into three causes; each has its own next step.

• The client changed something: another option, a program change, a late decision, a new budget. That is a scope change. Under the standard B101, Section 4.2.1 has the architect notify the owner with reasonable promptness and wait for written authorization before proceeding. The guide to additional services done without an amendment covers the log and the request.
• A construction-phase limit in the agreement was passed: more visits, reviews or months than it states. That is an additional service under the agreement’s own terms, and the notice goes out when the limit is reached, not at closeout.
• The firm’s own estimate or work: a phase priced too thin, coordination redone, a staffing choice. That is the firm’s cost. Absorb it, on purpose.

Absorbing on purpose means a written line: the date, the phase, the hours and dollars, the reason, and the name of the principal who decided. Then reset the hours to finish for the remaining phases, so an overrun in design development does not quietly borrow from construction administration. A dispute with a client over any of the three belongs with the firm’s attorney.

Use closed projects to set the next fee

At closeout, add one row per project to a simple record: building type, size, construction cost and client type; fee and actual hours for each phase; construction weeks assumed and actual; visits, submittals, requests for information and change orders; additional services billed and absorbed, with reasons.

After a handful of similar projects, the firm has its own ratios: hours per phase for its kind of work, construction administration hours per week of construction, hours per submittal and per request for information. Those set the next proposal’s phase split and its stated assumptions, with a price for anything beyond them. North Carolina’s 25% for the construction phase is one owner’s payment schedule, and the B101 percentages are blanks. Neither is the firm’s cost. The same record is the evidence at the next QBS fee negotiation, where a public agency arrives with its own estimate built from hours.

Illustrative example: five closed clinic projects show construction administration at 14 to 18 hours per week of construction, against the 12 the last three proposals assumed. The next proposal carries 16, states the 14 months of construction it assumes, and prices each added month. The numbers are invented.

When not to hire anyone, and where the Review fits

If the firm’s project-accounting system already shows earned against spent by phase every week, and someone reads it, the firm has what this guide describes. A principal who runs every project personally may see the burn without a report. A client refusing to pay for construction administration that ran long is a question for the firm’s attorney, not a consultant.

If fee burn is one of several places money slips between the signed agreement and the cleared payment — next to additional services drawn on a verbal yes, phases waiting to bill and invoices paid late — that is where an architecture & engineering business consultant earns a fee, and it is what the Revenue Review counts. It reads time by phase, agreements, invoices and the aging through read-only access, and puts a monthly dollar figure on each leak the records support. It takes two weeks. We are not architects or engineers, and there is no published A/E client case study on this site yet.

If the numbers suggest it, the next step is a free 20-minute call, which says plainly when the arithmetic does not justify the fee.