Owner billing on GMP jobs

On a lump sum job, you bill the owner for progress against a fixed price, and your costs are your business. On a guaranteed maximum price (GMP) job, the owner pays your actual cost of the work plus a fee, up to a ceiling. Your costs become the owner’s business, and every pay app has to prove them. This page explains how GMP billing is put together and how we plan to build it from the records you already keep.

What makes up a GMP

A GMP is usually built from a handful of buckets. Names and rules vary by contract (AIA A102 / A201, ConsensusDocs and owner-written forms all differ), so treat this as the common shape:

Bucket	What it covers	How it’s billed
Cost of the work	Subcontracts, materials, self-performed labor, equipment	Actual cost, with backup
General conditions	Field staff, temporary facilities, site costs	Actual cost, or a fixed or capped amount, per contract
Contractor contingency	Your risk allowance inside the GMP	Not billed directly; moved into cost lines when used, per contract rules
Allowances	Owner-defined amounts for scope not yet designed	Reconciled to actual; overs and unders adjust the GMP
Fee	Your overhead and profit	A percentage of cost, or a fixed amount
Insurance and bonds	Premiums tied to the work	Per contract, often a rate on cost

How a GMP pay app is built

Many GMP jobs still use AIA-style G702/G703 forms, with SOV lines aligned to the cost buckets, but the amounts billed are driven by cost, not by a percent-complete estimate. A typical monthly cycle:

Worked example

What owners look for

• Cost ties to backup. Every billed dollar traces to an invoice, a payroll record or an equipment charge.
• Contingency log. Every draw, what it covered, who approved it, and what’s left.
• Allowance reconciliation. Each allowance’s budget, committed and actual, with overs and unders flowing to a change order.
• Buyout against the GMP. Committed cost vs the GMP lines, so the owner can see savings or pressure early.
• Savings at the end. If final cost plus fee is under the GMP, savings are returned or shared per the contract. The calculation should be reproducible from the records.

How os.construction will build it (Planned)

Because job cost, commitments, change records and billing are one record, the GMP pay app is planned as a view of cost already coded to the job:

• Cost codes map to GMP lines once, at contract setup.
• Exclusions and caps from the contract are rules on the contract record, applied to every period.
• Backup is linked, not attached. Each billed amount links to the invoices, payroll and equipment records behind it.
• Contingency and allowances are logs with approvals, and their movements flow to the right lines.
• Owner visibility is set per job, so the owner sees the cost detail the contract entitles them to and nothing else.

Related: Pay apps, SOV and retainage, Cost codes and budgets, Owner reporting. Glossary: GMP, cost-plus, contingency, allowance, shared savings.