B101 Cost of the Work and Redesign Obligations (Article 6)

Article 6 of AIA B101-2017 defines 'Cost of the Work,' establishes the architect's obligation versus guarantee regarding the owner's construction budget, and specifies the conditions under which the architect must redesign at no additional cost versus when redesign qualifies as an Additional Service due to unanticipated market conditions.

ARE · Practice Management

Overview

Article 6 of AIA B101-2017 deals with the Cost of the Work. That phrase has a precise contractual meaning, and misunderstanding it is one of the fastest ways to end up in a dispute.

Here is the core tension this article resolves: the owner wants the architect to design within a budget. The architect does not want to guarantee construction costs that depend on market forces, contractor pricing, and material availability. Article 6 draws the line between those two positions.

This matters for the ARE because questions regularly test whether candidates can distinguish between an obligation (the architect must try to design within budget) and a guarantee (the architect promises the project will cost a specific amount). Article 6 creates an obligation, not a guarantee. But it still has teeth. If bids come in over budget, the architect may need to redesign the construction documents at no additional charge, depending on the reason for the overrun.

The article also defines what counts as "Cost of the Work" in the first place. Architect compensation is excluded. Labor, materials, and equipment donated by the owner are included. Detailed cost estimating, if the owner requests it, is an Additional Service.

Article 6 connects directly to the architect's scope under Article 3 (services performed across the five phases), the Additional Services provisions in Article 4, and the owner's budget responsibilities under Article 5. It also ties to A201's change order provisions, since budget overruns during construction often trigger formal contract modifications.

Understanding Article 6 means knowing when the architect absorbs the cost of redesign, when the owner pays for it, and how market conditions shift that balance.

Essential

What "Cost of the Work" Actually Means Article 6 of B101-2017 defines the Cost of the Work as the total cost to the owner of all elements of the project designed or specified by the architect. This definition has specific inclusions and exclusions that the ARE tests. Included in Cost of the Work: - All construction labor, materials, and equipment for the project - The reasonable value of labor, materials, and equipment donated to or furnished by the owner - General conditions costs and contractor overhead attributable to the project Excluded from Cost of the Work: - The architect's compensation and expenses - The cost of land - Rights-of-way and financing costs The inclusion of owner-donated items catches candidates off guard. If an owner donates salvaged brick worth $40,000 to the project, that $40,000 counts toward the Cost of the Work.

Professional

When the Numbers Don't Work: A Schematic Design Reality Check Consider a 45-unit affordable housing project with a construction budget of $18 million. During Schematic Design, the architect provides cost containment services and confirms the design direction fits within the budget. The contractor's preliminary estimate comes in at $17.4 million. Comfortable margin. By the end of Design Development, the updated estimate jumps to $19.8 million. Structural steel prices spiked 22% due to tariff changes that were announced publicly six months before the estimate. The architect was aware of the tariff announcement but did not adjust the design approach. Under Article 6, the architect would likely have to redesign at no additional compensation. The market condition (steel tariff) was publicly known and reasonably anticipatable. The architect's failure to account for it during design means the overrun falls on the architect's side of the line.

TLDR

Cost of the Work = total cost of all project elements the architect designed or specified, including owner-donated labor, materials, and equipment at reasonable value
Architect compensation is excluded from the Cost of the Work
The architect has an obligation to design within the owner's budget, not a guarantee that bids will match it
Detailed cost estimating is an Additional Service under standard B101 unless the contract says otherwise
If bids exceed budget due to unanticipatable market conditions, the owner compensates the architect's redesign as an Additional Service
If the architect should have anticipated the market conditions causing the overrun, redesign is at no additional charge
The architect's maximum liability under Article 6 is modifying the construction documents; the architect never pays the cost difference
The owner's options after a budget overrun: increase budget, rebid, revise scope with the architect, or terminate
Some public contracts include post-bid value engineering (up to a cap, such as 10% of the pre-bid budget) within basic services

ELI5

Imagine you hire a chef to cook a dinner party for $500. The chef promises to plan a menu that should cost around $500 at the grocery store. But the chef does not promise that the grocery store prices will actually be $500 when you go shopping. That is what Article 6 does for architects. The architect promises to design a building that should fit within your construction budget. But the architect is not guaranteeing that contractors will actually bid exactly that amount. Construction prices change based on supply, demand, labor availability, and a hundred other factors the architect does not control. So what happens if the grocery bill comes in higher than expected? If the prices went up because of something nobody could have predicted (say, a freak storm wiped out all the avocado farms overnight), the chef gets paid extra to redesign the menu. Fair enough.

AREPractice Management

B101 Cost of the Work and Redesign Obligations (Article 6)

2 min read273 words

Article 6: Who Bears the Risk When Construction Costs Exceed the Budget?

Article 6 of AIA B101-2017 deals with the Cost of the Work. That phrase has a precise contractual meaning, and misunderstanding it is one of the fastest ways to end up in a dispute.

Understanding Article 6 means knowing when the architect absorbs the cost of redesign, when the owner pays for it, and how market conditions shift that balance.

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