Funds Control
Contract Operations Planning, LLC (COP) is an experienced funds control / escrow company in the construction/ surety industry. We work with Surety Companies and their agents, Property Owners, Municipalities, Lenders, General Contractors, Vendors and Subcontractors to minimize financial risks on Construction projects. COP provides additional protection to its clients by managing the receivables and payables throughout the course of a construction project. Our funds management procedures assure that the project proceeds go only to the intended project. By constantly monitoring actual costs vs. budgeted costs, we can provide early warning of potential financial difficulties. In addition, COP assists small, emerging, and minority construction firms seeking the performance and payment bonds necessary to secure construction contracts.
What is Funds Control?
The Contractor enters into an escrow agreement with COP, LLC whereby the contractor agrees to direct the Obligee to send all earned contract funds directly to COP.  COP works with the Contractor to issue and disburse proper payments on each draw. COP is essentially providing back-office support to the contractor on a job specific basis with the ultimate goal of utilizing all earned/paid contract proceeds for costs on the job for which they were intended thereby minimizing claims for non-payment.
When is Funds Control used?
Here are a few situations that may warrant the use of escrow:
  • New client
  • Thin financials/past payment problems
  • Larger than normal project
  • Small contractor with little or no back-office support
  • Numerous subcontractors/suppliers
  • Specialty work (cost to find/hire a replacement contractor may be prohibitive)
  • Different type of work (i.e. a HVAC contractor now working as a General Contractor)
  • As a way to potentially reduce collateral
  • In some cases, when a bond cannot be obtained, funds control may be used in lieu of a bond
Types of Escrow
  • Standard
A Letter of Direction is sent to the Obligee, funds are sent by Obligee directly to escrow, each draw is processed in accordance with approved payment application/budget
  • Holdback
Same as standard, EXCEPT an additional amount (either a percentage amount per each draw or a flat amount) is held back from each draw as a build up account/cash collateral
  • Funded
Principal is required to deposit cash into the escrow that may or may not be used for job related costs based on the underwriter's instructions. If funds are allowed to be used for job costs, the funded amount can be reimbursed from draws as required by surety and held in account as cash collateral.
Getting Started  (simply fill in the form below as best you can and hit submit)
SPECIAL INSTRUCTIONS (e.g holdback/funded/silent)
Clear Form
  1. How do I get started?
    First you will need to fill out the form provided above. This worksheet will provide us with the information needed to prepare your escrow agreement. Once the escrow agreement is prepared it can be sent to you via email, fax, overnight service or regular mail.
  2. How quickly can an escrow be established?
    In as little as a few hours. All documents can be emailed; however, the escrow will not be considered “in place” until such time as COP has received the required signed documents.
  3. What is the expected "turn-a-round" time?
    It depends on how payments are received. For deposits made by wire transfer or ACH – checks can be turned around within 24 hours. If the Owner/Obligee pays by check, the typical turn-around time is 3 business days. All turn-a-round times are contingent upon receipt of the required draw paperwork.
  4. How much will it cost?
    COP charges a set-up fee of $500.00 and an escrow processing fee of 1% (one percent) of the final contract price. The set-up fee is to be submitted with the signed escrow agreement and is non-refundable. The processing fee can either be paid directly from the contractor or will be automatically taken from the first contract draw. We are able to negotiate rates based on the project facts, time schedule, type of work, etc.
  5. Are funds co-mingled?
    Absolutely not! We set up a separate bank account in the contractor's name under their tax id for which we are the signers on the account. Each account receives its own bank statement and reconciliation report on a monthly basis.
  6. Can you escrow a federal contract?
    YES! Under the FAR regs the federal government is prohibited from signing a letter of direction that would direct the funds to escrow. However, we do offer a "Silent" escrow option. This would be where the Obligee is not required to sign our document; however, the principal would change the ACH deposit instructions with the government to reflect the account number for the escrow account.