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Procore

Create Prime Contracts

Objective

To create a single prime contract or multiple prime contracts for a Procore project. 

Background

In Procore, you can create a single prime contract or multiple prime contracts to capture the initial contract data and to later manage updates that occur through the change order process. You can create a single prime contract when the agreement is between a single owner/client and a single general contractor. Creating multiple prime contracts may be necessary if a project is divided into parts and a separate agreement is required for each part.

EXAMPLES

When to Create a Single Prime Contract

A prime contract is a legal agreement between an owner/client (i.e., the party financing a construction project) and a primary contractor (i.e., the party that is being paid to manage the project and has full responsibility for ensuring completion of the work). In Procore, it is common for project teams to create a single prime contract.

When to Create Multiple Prime Contracts

Different funding and project delivery methods might lead a general contractor to create multiple prime contracts:

  • Multiple Funding Sources. A project can have many owners. In some scenarios, the general contractor may also be partially funding the job.
  • Multiple Stages. A project can be portioned into stages. For example, you might require separate prime contracts for pre-construction, course of construction, and aftercare/maintenance.
  • Multiple Phases. A project can be portioned into phases. For example, you might require separate prime contracts for the foundation, plumbing, HVAC, and so on.
  • Guaranteed Maximum Price (GMP) Contracts. A project can be fast-tracked or a phased GMP job. For example, you might require multiple prime contracts for each established scope-of-work package.
  • Construction Manager as Agent (CMa) Delivery Methods. A general contractor operating as a CMa might need to manage multiple prime contracts between an owner and various contractors.

Things to Consider

  • Required User Permissions:
  • Additional Information:
    • Most general contractors use the project's Budget tool to manage costs and contracts with subcontractors. Access to the Budget tool is typically limited to restrict the client or owner financing the project from seeing the budget. 
    • If your project's budget and prime contract are identical (i.e., or if the prime contract is a division-level summary of the budget), you can use your budget to create your prime contract. 
    • You can add multiple line items with the same cost code and cost type assignments. To distinguish between line items, enter descriptive summary in the Description field.
    • If you do not want to enter a cost code for a line item, you can enter 'None.'
  • Limitations:
  • Due to the sensitive nature of a project's prime contract data, Procore does NOT permit you to configure automatic email notifications from the system. To email a contract to another person, you must follow the steps in Email Prime Contract.
  • Additional limitations exist when creating multiple prime contracts. See Are there any system limitations when creating multiple prime contracts?

Steps

In Procore, you have the option to create a single prime contract or multiple prime contracts as described in Create Prime Contracts below. Once the prime, you can then Update the SOV on a Prime Contract

Create Prime Contracts

You can create a single prime contract or multiple prime contracts:

Create a Single Prime Contract

  1. Navigate to the project's Prime Contract tool.
  2. Click Create Prime Contract.

    create-new-prime-contract.png
     
  3. Under General Information, do the following:
    Notes: There are no required fields when creating a new prime contract. If you click Create without completing any data entry, the system saves the contract with your name listed as the creator and places it in the Draft status by default.
    • Sign with DocuSign
      If you are using the Procore + DocuSign integration (see DocuSign), a checkmark appears by default. Clear the box if the prime does NOT require a DocuSign signature. 
    • Contract #
      Accept the default contract number, enter a new number for the prime contract, or create a custom numbering scheme to use.
      Notes
      • If you plan to create multiple prime contracts, Procore increments this number for you by default (e.g., 1, 2, 3, and so on). 
      • To use a custom numbering scheme, you can enter a set of alphanumeric characters (e.g., PC-1 or PC-01 or PC-001) and Procore increments the number on new contracts.
    • Title
      Enter a descriptive name for the prime contract.
    • Owner/Client
      Select the project owner/client from the drop-down list.
    • Architect/Engineer
      Select the lead architect for the project from the drop-down list.
    • Contractor
      Enter the company name of the primary contractor managing the construction project. If you are setting up the prime contract, this will typically be your company's name. 
    • Status
      Select the current status for the prime contract. Options include: Draft, Out for Bid, Out for Signature, Approved, Complete, or Terminated.
      Note: 
      To create change orders and invoices, a prime contract's status must be set to Approved or Complete.
    • Executed
      Place a mark in this check box if the contract has been fully executed.
    • Make this Visible Only to Administrators and the Following Users
      Place a mark in this check box to limit visibility to users with 'Admin' permission and any users designated in the 'Allow These Users to See SOV Items' checkbox.
    • Allow These Users to See SOV Items
      Place a mark in this check box. Then select the names of any users who have been granted 'Standard' or 'Read Only' permissions on the Prime tool from the 'Select a Person' drop-down list.
    • Default Retainage. Specify a default percentage that will automatically be applied to all line item costs for retainage purposes (e.g. 10%).
    • Description
      Enter a descriptive summary to provide more detail about the prime contract.
    • Attachments
      Attach any relevant files to the prime contract. For example, an electronic copy of the signed contract.
  4. Under Contract Dates, do the following:
    Note: A user with 'Admin' permission on the Prime tool can configure the tool to show or hide the fields marked with an asterisk (*) below. See "Configure Settings: Prime Contract" in the See Also section below.
    • Date Created
      Shows the date the contract was created. This cannot be modified.
    • Start Date
      Specify the project's official start date.
    • Estimated Completion Date
      Specify the estimated date for project completion.
    • Substantial Completion Date*
      Select the date from the calendar control. The substantial completion date refers to the date that work is considered sufficiently complete to satisfy contractual requirements. It also indicates the date that the project owner or client can assume occupancy of all or part of a project and the general contractor is entitled to receive contract balance payment (less retainage) until final completion.
      Note: If enabled, the substantial completion date will be updated to each Prime Contract Change Order's Revised Substantial Completion Date once each Prime Contract Change Order has a status of Approved.
    • Actual Completion Date
      Select the date from the calendar control. The actual completion date refers to final payments have been processed and the contract is considered closed.
    • Contract Date*
      Select the date from the calendar control. The contract date is the effective date of the contractual agreement (i.e., the date the contract goes into force). 
    • Signed Contract Received Date
      Select the date from the calendar control. The signed contract received date is the date that the executed contract was received.
    • Execution Date*
      Select the date from the calendar control. The execution date is the date the agreement was signed by all parties. 
    • Issued On Date*
      Select the date from the calendar control. The issued on date is the date the contractual agreement was issued to both parties.
    • Returned Date
      Select the date from the calendar control. 
    • Letter of Intent Date
      Select the date from the calendar control. A letter of intent date is the date the LOI document outlining the agreement between parties is received before the contract is finalized. 
    • Approval Letter Date*
      Select the date from the calendar control. A letter of approval date is the date that compliance with the fees, statements, and disclosures stated in the Letter of Approval (LOA) for the contract was signed into record. 
    • Contract Termination Date
      Select the date from the calendar control. A contract termination date is the date outlined in the prime where all parties have met all contractual obligations and terms.
  5. Under Additional Information, do the following:
    • Inclusions. Specify any agreed-upon inclusions in the contract.
    • Exclusions. Specify any agreed-upon exclusions in the contract 
  6. Choose from these options:
    • If you have not yet created the contract, click Create or Create & Email.
      OR
    • If you are updating an existing contract, click Save or Save & Email.
  7. Click the Schedule of Values (SOV) tab.
  8. Click Edit. There are several different ways to create an SOV.

Create Multiple Prime Contracts

A general contractor may want to create multiple prime contracts for one of the following situations:

  • There are multiple entities funding the job. The project may have many owners, or the general contractor might be partially funding the job themselves.
  • There are contracts established for each stage of construction: pre-construction, course of construction, and aftercare/maintenance.
  • When operating a fast-tracked or phased GMP job, a Prime Contract can be created for each established scope-of-work package.
  • A contractor who is operating as a Construction Manager as Agent (CMa) and needs to manage the contracts that an owner has with the various contractors on a project.
  1. Navigate to the project's Prime Contract tool.
  2. If you have multiple prime contracts created, you will see them listed on the Prime Contract page. Click Create Prime Contract.
  3. Complete steps #3-6 above. 

    Note: There are a few limitations when creating multiple prime contracts. See What are the limitations when creating multiple prime contracts?

Update the SOV on a Prime Contract

There are three (3) ways to update the SOV on a prime contract:

Create the SOV from the Budget Tool

If you created a project budget (using the Budget tool), you can use it to quickly build out a Prime Contract's SOV. There are two options for how to create the Prime Contract SOV from the Budget tool. (Note: You can only perform this action if there are zero line items.)

  1. Navigate to the project's Prime Contract tool. 
    Note: Make sure that the Prime Contract status is set as "Draft" mode under the General tab.
  2. Click the Schedule of Values sub tool.
  3. Click Edit.
  4. You will have the option to perform one of the following actions:
    • Option 1: A line item will be created for each line item on the project budget

      Create_a_Prime_Contract_SOV_by_Line_Item.png
       
    • Option 2: A line item will be created for summaries of each division on the project budget. (Note: Use this option if you prefer to breakdown costs by division instead of by individual line items.)
      Create_a_Prime_Contract_SOV_by_Division_Summary.png
       
  5. ​Click Save to save your changes.

Import the SOV Line Items from a CSV File

If you prefer to upload a CSV to import all line items, please download and populate the provided CSV template instead. Be sure to follow the instructions in the tutorial below to ensure that you add your data to the CSV in the correct format because the uploader enforces very strict syntax requirements. Data must follow the prescribed format to ensure that your data can be successfully uploaded into Procore. For example, CSV rows that only contain a Cost Code Name and Cost Code Number will not produce a new line item.
Note: The Prime Contract must be in 'Draft' status in order for the Import from CSV option to be available. 
For more detailed instructions, see Import a Prime Contract CSV.

​Add Line Items​ to the SOV

To manually add line items to the Schedule of Values:

  1. Navigate to the project's Prime Contract tool.
  2. Click the Schedule of Values tab.
    edit-schedule-of-values2.png
  3. Click Edit
  4. Under Add Line Item, do the following:
    • Change Event Line Item. Select a change event line item from the list. This field only appears if your company has enabled the Change Events tool. See Should I enable the Change Events tool on my existing project?
    • Line Item. Select the prime contract line item or commitment line item from the list. This field only appears if your company has enabled the ERP Integrations tool.
      Notes:
      • The selections that appear in the list depends upon your project's change order tier configuration. See What are the different change order tiers?
      • If you are using a multi-tier change order configuration, you must select a line item on the Prime Potential Change Order (Prime PCO).
      • If you are using a single-tier change order configuration, you must select a line item on the Prime Contract Change Order (PCCO). 
    • Sub Jobs. Select a sub job from the list. This field only appears if you have enabled the Sub Job feature. See Enable Sub Jobs
    • Description. Enter a description in the box. 
    • Cost Code. Select a cost code from the drop-down list. 
    • Cost Type. Choose a cost type from the drop-down list. 
    • Tax Code. Select a tax code from the drop-down list. This field only appears if you have enabled the tax codes feature. See How can I use tax codes on a project?
    • Amount. Enter an amount in this box. 
  5. Click Add
  6. Repeat the steps above to add other line items. 
  7. Choose one of the following:
    • Save & Email. Click this button to save the SOV line item(s) and email the updates to members of the Prime Contract tool's default distribution lists. See Configure Settings: Prime Contract.
    • Save. Click this button to save the SOV line item(s) on the Prime Contract without sending an email. 

See Also