Published August 29, 2026
Affordable housing capital work fails in predictable ways: scope written too loosely, draws that do not match progress, and change orders that arrive after the money is committed. None of that is about construction skill.
Write scope that a funder can audit
A scope of work for a funded project needs to be specific enough that a third party can verify completion without being on site.
Weak: "Repair roof as needed." Auditable: "Remove existing shingles to deck on Buildings A and B (approx. 12,400 sq ft). Replace deteriorated sheathing at $X/sheet, quantity to be documented with photos. Install synthetic underlayment, ice and water shield 6 ft at eaves and all valleys, Class 4 impact-resistant architectural shingles, new pipe boots, new step and counter flashing. Haul and dispose. Permits included."
Quantities, materials, inclusions, exclusions, and unit prices for unknowns. Unit pricing for hidden conditions is what keeps a rotten-sheathing discovery from becoming a negotiation.
Structure the draw schedule to progress
A workable schedule for a mid-size exterior project:
| Draw | Trigger | % |
|---|---|---|
| 1 | Contract execution, permits pulled, materials ordered | 10–20% |
| 2 | Materials delivered and staged | 15–20% |
| 3 | Substantial progress (e.g., Building A complete) | 25–30% |
| 4 | All work complete, inspections passed | 25–30% |
| 5 | Retainage release after punch and closeout docs | 5–10% |
Tie every draw to a verifiable event with photos, not to a calendar date. Retainage should be real and released only on closeout documents — lien waivers, warranty, and final photos.
Change orders
Rules that prevent disputes:
- Nothing proceeds without a written, signed change order — no verbal approvals.
- Every change order states cost, schedule impact, and the reason.
- Hidden-condition changes reference the unit prices already in the contract.
- A running change-order log goes with every draw request.
Contingency of 10 to 15% on rehab and exterior work in Minnesota is realistic; 5% is optimism.
Documentation packet for each draw
- Progress photos, dated, matched to scope line items
- Invoice itemized to the same line items as the contract
- Signed lien waivers from the contractor and any subs paid from the prior draw
- Permit and inspection records
- Change order log
What owners should require of the contractor
- MN license (we hold residential remodeler QC807391) and current certificate of insurance naming the owner as additional insured
- W-9 on file
- Written warranty terms
- Named point of contact and after-hours number
- Willingness to work around residents, including notice, quiet hours, and secured work zones
Occupied-property realities
Funded rehab almost always happens with residents in place. Build the schedule around unit access, notice requirements, parking, and noise windows, and budget for the extra mobilization it causes. Projects that ignore this go over on schedule, then over on cost.
Working with affordable operators
We work with Twin Cities owners and managers on funded exterior and interior projects, provide itemized scopes with unit pricing, and document progress for draw requests.
Call 612-400-8036.
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Frequently asked questions
How should a draw schedule be structured on an affordable housing project?
Tie each draw to a verifiable event — permits and material order, delivery, substantial progress, completion, and retainage release — with dated photos rather than calendar dates.
How much contingency should a rehab project carry?
Ten to fifteen percent on Minnesota exterior and rehab work. Five percent does not cover hidden conditions like deteriorated sheathing or framing.
What paperwork should a contractor provide?
State license, a certificate of insurance naming the owner as additional insured, a W-9, signed lien waivers with each draw, written warranty terms, and change orders in writing before work proceeds.