Schedule of values: how to set it up so every pay app ties out

The schedule of values is the list that breaks the contract price into pieces. Every pay app you send is measured against it. If the schedule is right, the monthly pay apps are simple. If it's wrong, every pay app after it is wrong too, and the GC's reviewer will find it.

The schedule lives on the G703 continuation sheet, in column C: the scheduled value for each line. The total of column C must equal the original contract sum on Line 1 of the G702. If the lines add up to $248,000 and the contract is $250,000, the pay app is already off before a single dollar is billed. That's the first check, and it's the one most often missed.

When you build the schedule, keep these in mind.

Match the contract's breakdown. If the GC or the client gave you a bid breakdown, use it. Lines that don't match the contract are the main reason pay apps come back. Don't invent a new line because it's easier for you to track.

Keep the lines specific enough to measure. "Rough framing" and "finish carpentry" can be measured. "Miscellaneous" can't, and the GC can't check a percent complete on it. Split any large line until someone can look at the site and say how far along it is.

Don't put money into a line you can't finish. A line that's worth $40,000 but is only half done should show half done. Front-loading a schedule, by putting more value into early lines, is a common way to get paid faster, and reviewers notice it.

Keep change work separate. A change order adds to the contract sum on Line 2. It doesn't quietly grow an existing line. If the change adds new work, it gets its own line with its own value. See the guide on change orders for how that flows through the form.

Once the schedule is set, lock it. The original values on column C should not change from one pay app to the next. Any real change goes through a change order, so the original schedule stays on record.

Each month, the check is simple. Column G, the completed and stored to date, should never be more than column C on any line. Column H, the percent complete, should match what you can see on the site. Column I, the balance to finish, should add up to the contract sum less everything billed. If any of those don't hold, fix it before the pay app goes out.

NailMyPay builds the schedule of values with the contract sum, checks that the lines tie to it, and carries each line forward month to month without retyping. A pay app that doesn't tie out is flagged before it can be exported, so the form doesn't leave the building with an error on it. Your first pay app is free, so you can set up a real schedule and see how it ties out before you commit to anything.