A
- Addenda
- Formal written changes or clarifications issued by the owner, architect, or engineer after bid documents have been released but before the bid is due. Addenda become part of the contract and override any conflicting language in the original drawings or specifications. Always confirm receipt of the latest addendum before submitting — bids based on superseded documents are routinely thrown out.
- Allowance
- A dollar amount included in the bid to cover an item whose scope is known but whose selection has not been finalized — think "light fixture allowance of $12,000." If the actual cost comes in higher, it's a change order; if lower, it's a credit. Allowances move decisions out of the bid but should never be used to paper over missing scope.
- Alternate
- A priced deviation from the base bid that the owner can accept or reject. Alternates might cover upgraded finishes, substituted equipment, or an expanded scope. Each alternate is bid as a delta from the base and evaluated independently, so sloppy alternate pricing is one of the fastest ways to lose — or accidentally win — a job at a bad number.
B
- Base Bid
- The contractor's lump-sum price for the work as defined in the base contract documents, excluding any alternates or allowances. It's the number most often used to rank bidders at the opening, and it's what owners use when comparing apples to apples across competitors.
- BIM Building Information Modeling
- A coordinated 3D model of a building that carries geometry, material data, and metadata across design, construction, and operations. For estimators, BIM is both a gift and a trap — quantities are extractable, but the model's level of development (LOD) determines whether those quantities are bid-ready or just directional.
- BOM Bill of Materials
- A structured list of every material needed for the project, typically broken down by system, size, and quantity. The BOM is the bridge between the takeoff and the purchasing team; bad BOMs cause duplicate orders, shorts, and field RFIs.
- Bonding
- Surety-backed financial guarantees that protect the owner if the contractor fails to perform (performance bond) or fails to pay subs and suppliers (payment bond). Bond capacity is a hard cap on how much work a contractor can have in progress; bid bonds are usually required for public work.
- Buyout
- The phase after award when the GC or contractor converts their bid assumptions into signed subcontracts and purchase orders. Buyout gains — getting a sub in under the estimate — are margin; buyout losses eat fee. Most post-award profit is won or lost here.
C
- CAD Computer-Aided Design
- Software-based drafting and design. In estimating, CAD files (typically DWG or DXF) often accompany the PDF set and are far better inputs for automated takeoff than scanned plans — vector geometry can be measured directly rather than OCR'd.
- Change Order CO
- A written modification to the contract that changes scope, price, schedule, or some combination. COs arise from owner-directed changes, differing site conditions, design errors, or scope omissions. They're negotiated after the fact and are a leading cause of contract disputes.
- CM at Risk CMAR
- A project delivery method in which a construction manager joins the team early for pre-construction and then assumes risk for delivery under a guaranteed maximum price. Unlike pure CM-agent, the CMAR carries trade contracts and shoulders cost-overrun risk above the GMP.
- Conduit Fill
- The percentage of a conduit's cross-sectional area occupied by conductors, regulated by NEC Chapter 9, Tables 1 and 4. For three or more conductors, fill is capped at 40%. Over-fill flags a code violation and typically triggers a conduit upsize or reroute.
- Cost Plus
- A contract structure in which the owner reimburses the contractor for actual costs plus an agreed fee (fixed or percentage). Common on fast-track and negotiated work where scope isn't fully defined; it shifts cost risk to the owner and requires tight cost-code discipline from the contractor.
- Crew Rate
- The fully-loaded hourly cost of a named crew composition — e.g., "one foreman, two journeymen, one apprentice." Crew rates roll labor burden, small tools, and consumables into a single number that multiplies cleanly by labor hours from the estimate.
- Critical Path
- The longest sequence of dependent activities in a project schedule — the chain that determines overall duration. Any slip on a critical-path activity extends the project. Identifying it is the foundation of CPM scheduling and of credible delay claims.
- CSI MasterFormat
- The Construction Specifications Institute's standardized system for organizing project specifications into numbered divisions (01 through 48). It's the lingua franca of American commercial construction specs; most estimating databases and takeoff structures mirror MasterFormat divisions.
D
- Design-Build
- A delivery method where a single entity holds both design and construction contracts. It compresses schedule and gives the owner one throat to choke, but it also shifts design risk to the contractor and changes how estimators scope incomplete documents during pricing.
- Differing Site Conditions
- Physical conditions at the site that differ materially from those indicated in the contract documents (Type 1) or from those normally encountered (Type 2). Properly documented, DSCs are grounds for a change order; failing to document them early typically dooms the claim.
- Direct Costs
- Costs that can be tied to a specific work item — labor, material, equipment, and subcontracts. Direct costs form the backbone of the estimate before overhead, general requirements, and fee are applied on top.
- Duct Gauge
- The sheet-metal thickness of HVAC duct, referenced by gauge number (the higher the gauge, the thinner the metal). SMACNA tables dictate minimum gauge as a function of duct dimension, pressure class, and reinforcement spacing. Get the gauge wrong on takeoff and the weight estimate drifts 10-20%.
E
- Escalation
- A cost increase expected between the bid date and the actual purchase or install date, driven by commodity prices, wage changes, or lead-time pressure. On long-duration jobs, estimators add an escalation factor to material and labor lines; on short-cycle bids, escalation risk is typically absorbed or locked via supplier quotes.
G
- GC General Contractor
- The prime contractor responsible for executing the entire project under contract to the owner. The GC carries the schedule, coordinates subs, and is typically the entity to which subcontractor bids are delivered.
- General Requirements
- Project-wide costs that aren't tied to a specific trade — site supervision, temporary utilities, dumpsters, site safety, cleanup, office trailer. These live in CSI Division 01 and are often under-estimated by trade contractors unfamiliar with self-performing the site logistics.
- GMP Guaranteed Maximum Price
- A ceiling on the total project cost under a cost-plus-style contract, above which the contractor (not the owner) absorbs overruns. Savings below the GMP are sometimes shared. It's a middle ground between lump-sum and pure cost-plus.
H
- Hard Costs
- The tangible construction costs — labor, materials, equipment, and subcontracts — that go into the physical building. Hard costs exclude soft costs like design fees, permits, and financing, which are carried separately on the owner's budget.
I
- IPC 2021 International Plumbing Code
- The 2021 edition of the International Plumbing Code, adopted in various forms by most US jurisdictions. It governs fixture counts, drainage fixture units, venting, and water supply sizing — the numbers plumbing estimators carry through every takeoff.
L
- Labor Burden
- The costs an employer pays on top of base wages — payroll taxes, workers' comp, unemployment insurance, health benefits, retirement, and paid time off. Burden typically runs 25% to 50% of base wage depending on trade, jurisdiction, and benefits package. Estimators carry burden as a multiplier on raw labor hours.
- Labor Unit
- The standard number of hours required to install a given quantity of work — for example, "0.25 hours per receptacle rough-in." Labor units are the atomic building block of a takeoff-to-bid pipeline, typically pulled from published libraries (NECA MLU, RSMeans) or a contractor's own historical data.
- Liquidated Damages LDs
- A pre-agreed daily dollar amount the contractor owes the owner if substantial completion slips past a contract milestone. LDs are meant to approximate actual damages, not penalize — but on public work they can run thousands per day and rapidly eat into thin-margin jobs.
- Lump Sum
- A fixed-price contract in which the contractor delivers the full defined scope for a single price, regardless of actual cost. All cost risk sits with the contractor. It's the classic hard-bid structure and rewards tight estimates and tight execution.
M
- MEP Mechanical, Electrical, Plumbing
- The three core building-systems trades that collectively make a building work. MEP coordination — making sure ducts, conduits, and pipes don't fight for the same ceiling space — is both a design problem and an estimating problem; poor coordination shows up as field rework and RFI-driven change orders.
N
- NEC 2023 National Electrical Code
- The 2023 edition of NFPA 70, the foundational US electrical code. Not all jurisdictions adopt the latest edition immediately — some are still on NEC 2020 or 2017 — so estimators confirm which edition the AHJ has adopted before running conduit fill, ampacity, or demand calcs.
- NECA MLU Manual of Labor Units
- The National Electrical Contractors Association's published labor-unit library — the de facto standard for labor hours on electrical work. MLU values assume "normal" conditions; adjustments are applied for congested spaces, heights above 10 ft, concealed installations, and similar accessibility factors.
P
- Performance Bond
- A surety bond guaranteeing that the contractor will complete the contract as agreed. If the contractor defaults, the surety either funds completion, arranges a replacement contractor, or pays out up to the bond amount. Bond capacity directly limits how much backlog a contractor can hold.
- Plan Room
- A physical or digital space (today almost always digital — iSqFt, BuildingConnected, Dodge) where bid documents are posted for contractor review. Plan rooms host drawings, specs, addenda, and bid invitations; missing an addendum drop in the plan room is a classic cause of under-scoped bids.
- Productivity Factor
- A multiplier applied to base labor units to account for conditions that make the crew faster or slower than "book" rate — weather, congestion, shift work, height, unfamiliarity, or repetitive work. A productivity factor of 1.15 means the work will take 15% longer than the published labor unit suggests.
- Punch List
- The itemized list of incomplete or deficient work identified at substantial completion. Closing out the punch list is the final gate to final payment and release of retention, and the quality of the punch list often determines how painful the closeout phase becomes.
Q
- Quantity Takeoff QTO
- The measurement-and-count process that extracts quantities (linear feet, square feet, each, cubic yards) of every work item from the plans and specs. The QTO is the raw input to pricing; any error here compounds through every downstream labor and material calculation.
R
- Rebar Schedule
- A table on the structural drawings listing every reinforcing bar — mark, size, grade, length, bend configuration, and quantity. The rebar schedule is the estimator's primary source for concrete reinforcing takeoff; missing bar marks or incorrect lap lengths is a common source of tonnage errors.
- Retention
- A percentage (typically 5-10%) of each progress payment withheld by the owner until the contract is satisfactorily completed. Retention is released after punch list closeout and lien-release exchange. It protects the owner but ties up working capital, which is why subs push to reduce retention at 50% completion.
- RFI Request for Information
- A formal written question from contractor to design team seeking clarification on the contract documents. In estimating, RFIs are issued during bid phase to clarify ambiguous details; during construction, they track scope and schedule impact. High RFI counts are a leading indicator of design-document quality.
- RFQ Request for Quote
- A solicitation from a GC or owner asking trade contractors or suppliers to submit pricing on defined scope. Typically less formal than a full bid invitation and often used during preconstruction or for smaller-value scope packages.
S
- Scope Gap
- A piece of work that none of the bidding trades assumed was theirs — the classic example being fire-caulking at penetrations, which electrical, mechanical, and plumbing all think the other guy is doing. Scope gaps surface as change orders after award and are one of the most expensive estimating mistakes to correct.
- Self-Perform
- Work that a contractor executes with their own direct labor rather than subcontracting out. Self-performed scope gives better cost control and schedule predictability but requires the manpower, equipment, and burden to carry it. GCs with strong self-perform capacity typically win more on cost-competitive bids.
- SMACNA
- The Sheet Metal and Air Conditioning Contractors' National Association, whose published standards govern ductwork gauge, reinforcement, hangers, and fittings. SMACNA tables are as fundamental to sheet-metal estimators as NECA MLU is to electrical estimators.
- Soft Costs
- Non-construction costs on the owner's budget — design fees, permits, legal, financing, insurance, FF&E, and testing. Soft costs typically run 15-30% of total project cost on commercial work and are usually carried by the owner or their program manager, not the contractor.
- Submittal
- A document, sample, or product data sheet submitted by the contractor to the design team for approval before procurement. Typical submittals include shop drawings, material samples, equipment cut sheets, and mix designs. Submittal log health is a reliable leading indicator of schedule health.
T
- T&M Time and Material
- A billing structure in which the contractor invoices for actual labor hours and materials, marked up by an agreed percentage. Used for small change-order work and emergency repairs where scope can't be defined in advance. T&M requires granular daily cost capture — loose tracking here guarantees pricing disputes.
U
- Unit Price
- A per-unit price ($/CY, $/LF, $/SF) used on scope where quantities can't be pinned down in advance — earthwork being the classic example. Unit price contracts are paid based on actual measured quantities at the bid-in rate, so measurement disputes are the structural weakness of this contract type.
V
- Value Engineering VE
- A structured process of identifying cost savings by modifying scope, materials, or methods without compromising required function. Proper VE is collaborative and early; "value engineering" in the pejorative sense — late-stage cost cuts that hollow out quality — is how the term ended up with an ambiguous reputation.
W
- WBS Work Breakdown Structure
- A hierarchical decomposition of the total scope into deliverable-oriented work packages. The WBS is the organizing skeleton that the schedule, budget, and cost codes all align against. A clean WBS makes earned-value tracking possible; a messy one makes it nearly impossible.
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