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Strategies for Work Zone Transportation Management Plans (2020)

Chapter: Chapter 8 - Alternative Contracting and Construction Strategies

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Suggested Citation:"Chapter 8 - Alternative Contracting and Construction Strategies." National Academies of Sciences, Engineering, and Medicine. 2020. Strategies for Work Zone Transportation Management Plans. Washington, DC: The National Academies Press. doi: 10.17226/25929.
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Suggested Citation:"Chapter 8 - Alternative Contracting and Construction Strategies." National Academies of Sciences, Engineering, and Medicine. 2020. Strategies for Work Zone Transportation Management Plans. Washington, DC: The National Academies Press. doi: 10.17226/25929.
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Suggested Citation:"Chapter 8 - Alternative Contracting and Construction Strategies." National Academies of Sciences, Engineering, and Medicine. 2020. Strategies for Work Zone Transportation Management Plans. Washington, DC: The National Academies Press. doi: 10.17226/25929.
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Suggested Citation:"Chapter 8 - Alternative Contracting and Construction Strategies." National Academies of Sciences, Engineering, and Medicine. 2020. Strategies for Work Zone Transportation Management Plans. Washington, DC: The National Academies Press. doi: 10.17226/25929.
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Suggested Citation:"Chapter 8 - Alternative Contracting and Construction Strategies." National Academies of Sciences, Engineering, and Medicine. 2020. Strategies for Work Zone Transportation Management Plans. Washington, DC: The National Academies Press. doi: 10.17226/25929.
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133 Contracting strategies refer to the contractual agreements used to accelerate construction completion of transportation projects. A contracting strategy is the combination of the delivery method, the procurement procedure, and the payment provision. The traditional strategy, and in most cases the ideal choice, to contract a project is the design–bid–build (DBB) delivery method, a low-bid procurement procedure, and a unit-price payment provision. However, this traditional approach may not provide the best value for all project types, especially for traffic-critical projects that require a quick changeover from the design into the construction stages. In such instances, state DOTs have started implementing alternative contracting methods (ACMs) to yield time savings during the procurement or construction phases (or both). This section discusses the following ACMs: • Design–build • Construction manager/general contractor • Cost-plus-time (A+B) bidding selection method • Incentive/disincentive clauses • No-excuse incentives • Lane rental • Value engineering • Accelerated bridge construction Accelerated construction is the use of special materials and techniques to reduce the time it takes to rehabilitate or reconstruct a roadway. Examples of accelerated construction strategies include the following: • Precast modular concrete road panels and bridge elements (e.g., culverts, bridge deck slabs, pavement slabs). • High early-strength concrete. • Self-propelled modular transports (SPMTs) to quickly replace an existing bridge with one fabricated completely off site. • Hot in-place asphalt recycling. Accelerated bridge construction (ABC) is presently the most common form of project-level accelerated construction and is also discussed in this section. 8.1 Design–Build Contracting Method 8.1.1 Description Design–build (D-B) is a delivery method in which one entity (the design–builder) is awarded a single contract for design and construction services. In this method of project delivery, C H A P T E R 8 Alternative Contracting and Construction Strategies

134 Strategies for Work Zone Transportation Management Plans the design is often broken into packages or segments, allowing construction to begin on portions of the project while other elements are still being designed. 8.1.2 When to Use The D-B method is not suited for every project. This method works best for • Projects that need to be “fast-tracked” or expedited; • Projects that allow for innovation in design and construction; • Projects with funding deadlines that traditional DBB delivery may not be able to meet; • Emergency projects; • Projects with a clearly defined scope, design basis, and performance requirements; • Projects with low possibility for significant change during all phases of work; • Projects with low risk of unforeseen conditions; • Projects with a complete National Environmental Policy Act process; • Projects that require minimal or no ROW acquisition and limited utility relocation; and • Projects that can use best-value procurement or other methods tailored to benefit the specific needs of a project. CDOT and WSDOT have developed formal guidance on how to select a project-delivery method from the three common delivery methods of DBB, D-B, and CM/GC. CDOT and the University of Colorado developed the Project Delivery Selection Matrix (PDSM) to provide a risk-based and objective selection approach to comparing and choosing the most suitable project-delivery method. Use of the PDSM is expanding throughout the transportation industry, as it is increasingly being used by other state DOTs. More information on the PDSM can be found in Section 12.4 of this guidebook. The PDSM, a list of CDOT projects that used the PDSM, and the project comparison results are provided on the CDOT PDSM web page (https://www.codot.gov/business/designsupport/adp-db-cmgc/pdsm). Using CDOT’s PDSM as a foundation, WSDOT developed the Project Delivery Method Selection Guidance (PDMSG). The PDMSG is available at https://www.wsdot.wa.gov/ construction-planning/project-delivery/method-selection-guidance. More information on the PDMSG can be found in Section 12.6. 8.1.3 Benefits The main benefit of D-B is that it allows the design and construction phases to overlap, thereby reducing project completion time. Other advantages of the D-B method include the following: • Allows for greater innovation in selecting design, materials, and construction methods. • Reduces claims resulting from design errors. • Allows for a single contract that addresses quality, costs, and schedule from design through construction. • Offers price certainty, as construction cost is known and fixed during design. • Allows for a shortened project-delivery time that can reduce user costs. • Requires less DOT expertise and fewer resources. 8.1.4 Expected Effectiveness Multiple studies have evaluated the effectiveness of D-B as a delivery method. However, because of variations in project scope and difficulty in identifying comparable DBB projects for use as baselines, these studies produced highly variable results.

Alternative Contracting and Construction Strategies 135 The results of an internal FDOT study conducted in March 2014 indicated that using the D-B approach to deliver a $55 million and 814-day project resulted in a cost savings of $6,457,345 and total time savings of 656 days compared with using DBB (https://www.fdot.gov/construction/ DesignBuild/DBGeneral/GeneralInfoMain.shtm). A 2006 FHWA study on D-B projects, completed under Special Experimental Project No. 14, Alternative Contracting (SEP-14), reported the following: • Average 14 percent time savings for D-B projects when compared with DBB schedule estimates and a 3 percent reduction in total cost (based on survey respondent estimates). • Average reduction of 1 percent between planned and actual construction duration based on actual data for the surveyed D-B projects. In contrast, comparable DBB projects showed an average increase of more than 11 percent in actual construction duration. In 2007, FDOT conducted a comprehensive evaluation of its ACMs (Ellis et al. 2007). FDOT obtained performance data for all its constructed projects completed between January 1998 and March 2006. The project database included 3,130 projects, of which 1,160 used ACMs. The evaluation compared the performance of each ACM to the traditional DBB contracting performance. Project performance evaluation focused on four key areas: (1) cost, (2) time, (3) contractor performance, and (4) value contribution. The following are the most significant findings of this evaluation: • Cost. Average cost growth for projects using ACMs was 8.04 percent compared with 9.36 percent for traditional DBB projects (excluding incentive costs). D-B projects had a cost growth of 4.45 percent. • Time. Average time growth for projects using ACMs was 4.13 percent compared with 16.47 percent for traditional DBB projects. 8.1.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.1.6 Implementation Considerations D-B projects can utilize either a one-step or two-step selection process. In a one-step process, a request for proposal (RFP) is issued to a number of participants, and any and all parties can respond to this RFP with a proposal. In the two-step D-B process, a request for qualifications (RFQ) is first issued to a number of participants. Those participants then respond with a statement of qualifications explaining their experience and their capability to perform the work. From the statements of qualifications, a short list of the three to five most qualified respondents is determined. The RFP is then issued only to the short-listed firms, which then develop a full proposal including cost, schedule, and technical responses to the RFP. The proposal most advantageous to the project owner from both cost and technical aspects is then awarded, using either a “low-bid” or a “best-value” selection process. For a low-bid selection, the D-B contract is awarded to the lowest responsive and competent bidder. Best- value selection permits the consideration of additional factors, such as experience, qualifications, innovation, technical approach, quality-control methods, and project management. A D-B project requires extensive work to develop an RFQ and RFP. Typically, state DOTs have hired consultants to assist in this effort.

136 Strategies for Work Zone Transportation Management Plans 8.1.7 Design Features and Requirements Sufficient preliminary engineering (30 percent) needs to be performed before an agency can execute a D-B contract. Project scope needs to be clearly defined. ROW limits and acqui- sition processes are required to be well under way to minimize delays to the contract. Another standard practice is to require the agency to complete environmental processes, such as those mandated under the National Environmental Policy Act, before moving into the RFP stage of procurement. 8.1.8 State of the Practice According to the Design–Build Institute of America, as of January 2019, D-B is a limited option in only seven states—Alabama, Iowa, New Jersey, New York, North Dakota, Pennsylvania, and Wisconsin. D-B is widely permitted in the rest of the states and the District of Columbia. D-B is institutionalized and extensively used by state DOTs of Colorado, California, Florida, Michigan, Minnesota, Ohio, Utah, and Washington. Examples of D-B projects are widely available on the state DOT websites and are not repeated here to avoid duplication. Instead, readers are requested to refer to the following state web pages for more information on D-B case studies. • The CDOT Alternative Delivery Program web page (https://www.codot.gov/business/ designsupport/adp-db-cmgc) includes summaries of active and completed projects that were delivered using D-B or CM/GC. The web page also includes lessons learned from D-B and CM/GC projects. • The Caltrans D-B Program web page (https://dot.ca.gov/programs/design/design-build- program) provides example summaries of two projects that were delivered using D-B. The reasons for selecting the D-B approach are also listed as part of the project summaries. • The FDOT Construction web page (https://www.fdot.gov/construction/DesignBuild/AllSites/ DesignBuildSites.shtm) provides information on current and planned D-B projects. Also included is a summary of D-B projects, which is updated quarterly. • The MDOT Innovative Contracting web page (https://www.michigan.gov/mdot/0,4616,7- 151-9625_21539_53226---,00.html) lists future, active, and completed projects that will be delivered using either D-B or CM/GC. • The MnDOT D-B web page (https://www.dot.state.mn.us/designbuild/index.html) provides information on completed, active, and future projects delivered using the D-B approach. • The ODOT Alternative Project-Delivery web page (http://www.dot.state.oh.us/Divisions/ ConstructionMgt/design-build/Pages/Design_Build.aspx) provides information on upcoming D-B projects, as well as examples of past D-B projects that were awarded using both least cost and best value. • The UDOT Innovative Contracting web page (https://www.udot.utah.gov/main/f?p=100: pg:0::::V,T:,4552) provides information on completed and future D-B and CM/GC projects. Additional information such as laws, rules, policies, guidelines, and RFP templates can also be found on this web page. In addition, the FHWA ACMs Library web page (https://www.fhwa.dot.gov/construction/ contracts/acm/) provides several D-B resources including state DOT legislation, state DOT D-B project website links, manuals of instruction, and proposal templates. Case studies of D-B projects can be found on the FHWA SEP-14 Active Project List (https://www.fhwa.dot. gov/programadmin/contracts/sep14list.cfm) and on the FHWA Center for Innovative Finance Support D-B web page (https://www.fhwa.dot.gov/ipd/alternative_project_delivery/defined/ new_build_facilities/design_build.aspx).

Alternative Contracting and Construction Strategies 137 8.1.9 Cost D-B is a planning strategy and there is no separate cost for its implementation. The costs associated relate to in-house or consultant-staffing resources to develop and manage a project. 8.1.10 Resources and References Caltrans. Alternative Procurement Guide, California Department of Transportation, April 2008. Ellis, R., J.-H. Pyeon, Z. Herbsman, E. Minchin, and K. Molenaar. Evaluation of Alternative Contracting Techniques on FDOT Construction Projects, Final Report, Florida Department of Transportation, July 2007. FDOT. Design–Build and Design–Bid–Build: Comparison of Overall Cost and Time, Internal FDOT Study, March 2014. FHWA. Design-Build Effectiveness Study, As Required by TEA-21 Section 1307(f), January 2006. MDOT. Innovative Construction Contracting Guide, Michigan Department of Transportation, September 5, 2014. Minchin, E., L. Ptschelinzew, G. C. Migliaccio, U. Gatti, K. Atkins, T. Warn, G. Hostetler, and S. Asiamah. NCHRP Report 787: Guide for Design Management on Design-Build and Construction Manager/General Contractor Projects. Transportation Research Board of the National Academies, Washington, D.C., 2014. Turner-Fairbank Highway Research Center. Alternative Contracting Method Performance in U.S. Highway Construction, FHWA-HRT-17-100, FHWA, U.S. DOT, April 2018. UDOT. Alternative Contracting Process, SEP-14 Construction Manager General Contractor, Annual Report 2011, Utah Department of Transportation, February 2012. UDOT. Best Value Design-Build Selection Manual of Instruction, Utah Department of Transportation, October 2017. 8.2 Construction Manager/General Contractor 8.2.1 Description The construction manager/general contractor (CM/GC) project-delivery method allows an owner to engage a construction manager (CM) during the design process to provide construc- tability input. The design firm and the CM are contractually required to work together during the design phase to create a project that is potentially less expensive and is quicker and easier to construct. Some state laws refer to the CM/GC delivery method as the construction-manager- at-risk method. 8.2.2 When to Use Projects best suited for the CM/GC process include complex components that require innovation, or “thinking out of the box,” and are typically located in urban areas. Other projects that are a good fit for the CM/GC process are projects that have public involvement or include ROW or utility issues that affect the overall schedule. The CM/GC is less suitable for straightforward projects, projects with an easily defined scope and low risk, and projects that lack schedule sensitivity. CDOT and WSDOT have developed formal guidance on how to select a project-delivery method from the three common delivery methods of DBB, D-B, and CM/GC. CDOT and the University of Colorado developed the PDSM to provide a risk-based and objective selection approach to comparing and choosing the most suitable project-delivery method. Use of the PDSM is expanding throughout the transportation industry, as it is increasingly being used by other state DOTs. More information on the PDSM can be found in Section 12.4 of this guidebook. The PDSM, a list of CDOT projects that used the PDSM, and the project comparison results are provided on the CDOT PDSM web page (https://www.codot.gov/business/ designsupport/adp-db-cmgc/pdsm).

138 Strategies for Work Zone Transportation Management Plans Using CDOT’s PDSM as a foundation, WSDOT developed the PDMSG. The PDMSG is available at https://www.wsdot.wa.gov/construction-planning/project-delivery/method-selection- guidance. More information on the PDMSG can be found in Section 12.6. 8.2.3 Benefits The CM/GC method is based on team building and cooperation between the project owner, the design firm, and the CM from the beginning of the project’s conceptual design through final construction. CMs can reduce occurrences of change orders, project construction delays, and increased project costs by preventing these obstacles in the design phase instead of dealing with them in the construction phase. The CM will thus need the ability to input constructability reviews, construction phasing, material availability, and cost estimating throughout the design process. Use of the CM/GC delivery method provides the following benefits: • Allows fast-tracking of design and construction activities, resulting in time savings. • Allows for innovation and constructability recommendations during design, but the agency retains significant control over the design. • Enables the CM/GC to invest more in cost engineering and constructability reviews once guaranteed maximum price (GMP) is established, thus minimizing risks. • Fixes project costs and completion responsibility. • Reduces design costs by reducing the amount of detail required and by focusing the pre- construction early design effort on constructible solutions. 8.2.4 Expected Effectiveness Caltrans has reported $80 million in cost avoidance by using CM/GC for five projects in FY 2017–18 (Table 8.1). Project Name Work Description Construction Capital Cost at Contract Award Project Savings Highway Facility Rehabilitation, Reconstruction, or Replacement Projects Implemented by Caltrans SBD 58 Kramer Junction Innovation: Earthwork and landscape changes Highway Realignment $165,245,000 $41,266,000 SBD 215 Barton Rd IC Innovation: Project staging, temporary facility changes, and elimination of items Interchange Reconstruction $47,401,000 $3,203,000 Subtotal for projects implemented by Caltrans $212,646,000 $44,469,000 Nonrehabilitation, Reconstruction, or Replacement Projects Implemented by Others ALA 80 Bay Bridge Innovation: Revised pile and concrete requirements Foundation Removal $44,079,000 $4,388,000 SD 5 North Coast Corridor, package 2 Innovation: Earthwork, use of on-site material plants and material recycling plants HOV Lanes $93,821,000 $31,050,000 SD 5 North Coast Corridor, package 3 Innovation: Changed aesthetic treatment and fencing HOV Lanes $5,330,000 $818,000 Subtotal for projects implemented by others $143,230,000 $36,256,000 Totals for all Transportation Projects $355,876,000 $80,725,000 NOTE: CM/GC = construction manager/general contractor. Table 8.1. Caltrans CM/GC projects for FY 2017–18.

Alternative Contracting and Construction Strategies 139 8.2.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.2.6 Implementation Considerations The selection of the design firm is the initial step during the early stages of the project. The design firm is typically contracted through project completion, which includes site investi- gations, alternative analyses, cost estimates, detailed design, construction bid documents, and department-related construction-management services. The CM is selected on the basis of qualifications, past experience, or best value. The owner advertises an RFP when the scope and schedule are known, typically before the preliminary design (i.e., 30 percent) is complete. The CM submits a response to the department’s RFP. The CM is contracted for the design phase to provide input regarding construction phasing, constructability reviews, cost estimating, scheduling, and other feedback. At substantial design completion (≥60 percent), the owner and the CM negotiate a GMP to construct the project based on the defined scope and schedule. If this price is acceptable to both parties, they execute a contract for construction services, and the CM becomes the general contractor. Major risks and disadvantages of a CM/GC delivery method include the following: • The project price is negotiated with a CM and not competitively bid. • A designer may not include CM/GC. • Use of GMP may lead to a large contingency to cover uncertainties and incomplete design elements. • Use of GMP can lead to disputes over the completeness of the design and contract changes. • CM/GC design input does not necessarily translate into better design quality. 8.2.7 Design Features and Requirements Under the CM/GC delivery method, the project owner selects a CM/GC firm to perform preconstruction and construction-management services. During the design phase, the CM/GC firm acts in an advisory or management role. The firm provides constructability reviews, value engineering suggestions, construction estimates, and other construction-related recommenda- tions. At some point on or before design reaches 100 percent completion, the agency and the CM/GC firm negotiate a GMP, which is primarily based on the partially completed design and includes the CM/GC cost estimate for the remaining design elements. Once the GMP is established, the CM/GC firm starts the construction phase, thus allowing the design and construction phases to overlap. During construction, the CM/GC firm acts as a general contractor and performs contractually obligated work. The contractor holds the construction contract and risk for any construction costs that exceed the GMP. 8.2.8 State of the Practice CM/GC is frequently used by the state DOTs of Colorado, California, Michigan, Minnesota, and Utah. Examples of CM/GC projects are widely available on the state DOT websites and

140 Strategies for Work Zone Transportation Management Plans are not repeated here to avoid duplication. Instead, readers are requested to refer the following state web pages for more information on CM/GC case studies: • The CDOT Alternative Delivery Program web page (https://www.codot.gov/business/design support/adp-db-cmgc) includes summaries of active and completed projects that were delivered using D-B or CM/GC. The web page also includes lessons learned from D-B and CM/GC projects. CDOT began using CM/GC in 2009 and has, as of this writing, used CM/GC to deliver more than 15 projects. • The Caltrans CM/GC Program web page (https://dot.ca.gov/programs/design/contract- manager-general-contractor) provides example summaries of projects delivered using a CM/GC approach. The reasons for selecting CM/GC are also listed as part of the project summaries. • The MDOT Innovative Contracting web page (https://www.michigan.gov/mdot/0,4616,7- 151-9625_21539_53226---,00.html) lists future, active, and completed projects that will be delivered using either D-B or CM/GC. • The MnDOT CM/GC web page (http://www.dot.state.mn.us/const/tools/const-manager- general-contractor.html) provides information on completed, active, and future projects delivered using the CM/GC approach. • The UDOT Innovative Contracting web page (https://www.udot.utah.gov/main/f?p=100:pg: 0::::V,T:,4552) provides information on completed and future D-B and CM/GC projects. Additional information such as laws, rules, policies, guidelines, and RFP templates can also be found on this web page. In addition, the FHWA ACMs Library web page (https://www.fhwa.dot.gov/construction/ contracts/acm/) provides CM/GC resources, including state DOT legislation, state manuals of instruction, and proposal templates. Case studies of CM/GC projects can be found on the FHWA SEP-14 Active Project web page (https://www.fhwa.dot.gov/programadmin/contracts/sep14list.cfm). 8.2.9 Cost CM/GC is a planning strategy and there is no separate cost for its implementation. The costs associated relate to in-house or consultant-staffing resources to develop and manage a project. 8.2.10 Resources and References ADOT. Construction Manager at Risk (CMAR). Intermodal Transportation Division, Arizona Department of Transportation, September 2010. AASHTO. Primer on Contracting for the Twenty-First Century, 5th ed., AASHTO Subcommittee on Construction, Washington, D.C., 2006. Anderson, S. D., and I. Damnjanovic. NCHRP Synthesis 379: Selection and Evaluation of Alternative Contract- ing Methods to Accelerate Project Completion. Transportation Research Board of the National Academies, Washington, D.C., 2008. Caltrans. Alternative Procurement Guide, California Department of Transportation, 2008. Harper, C. M., D. Tran, T. McGuire, and K. Molenaar. Selecting a Procurement Procedure for Highway Con- struction Projects. Presented at 93rd Annual Meeting of the Transportation Research Board, Washington, D.C., 2014. MDOT. Innovative Construction Contracting, Michigan Department of Transportation, April 2013. Minchin, E., L. Ptschelinzew, G. C. Migliaccio, U. Gatti, K. Atkins, T. Warn, G. Hostetler, and S. Asiamah. NCHRP Report 787: Guide for Design Management on Design-Build and Construction Manager/General Contractor Projects. Transportation Research Board of the National Academies, Washington, D.C., 2014. MnDOT. Innovative Contracting Guidelines, Office of Construction and Innovative Contracting, Minnesota Department of Transportation, Saint Paul, December 2008.

Alternative Contracting and Construction Strategies 141 UDOT. Alternative Contracting Process: SEP-14 Construction Manager General Contractor. Utah Department of Transportation Annual Report 2011, February 2012. UDOT. Benefits of Contract Manager/General Contractor (CM/GC), Utah Department of Transportation, February 2009. UDOT. Construction Manager General Contractor Selection: Manual of Instruction, Utah Department of Transportation, June 2015. 8.3 Cost-Plus-Time (A+B) Bidding Selection Method 8.3.1 Description Cost-plus-time, or A+B, bidding uses a cost parameter (A) and a time parameter (B) to deter- mine a bid value. The cost component (A) is the traditional bid for the contract items and is the dollar amount for work performed under the contract. The time component (B) is the total number of calendar days required to complete the project, as estimated by the bidder, multiplied by an agency-determined daily RUC to translate time into dollars. The bid for award consideration is based on a combination of the bid for the contract items and the associated cost of the time according to the following formula: A + (B × RUC/Day) = Total Bid This formula is only used to determine the lowest responsible bidder for award and is not used to determine payment to the contractor. 8.3.2 When to Use A+B procurement is best suited for highway projects in urban settings with high volumes of road users. Also, it is suitable for projects that severely affect local businesses during the construction and for projects with a tightly constrained end date. Many state agencies use A+B bidding with incentive/disincentive (I/D) provisions as an additional motivation for contractors to save time. Examples of projects that could be considered for A+B bidding include the following: • Widening projects for which permanent traffic control is to be set up for an extended period of time. • Projects that have multiple activities occurring, which don’t necessarily have to be done sequentially. • Projects for which the contractor’s presence or activities will affect traffic, regardless of whether traffic control is set up. • Projects that allow alternate solutions, when one solution may take significantly less time to construct but designers are hesitant to specify a proprietary solution. • Projects in which innovative solutions by the contractor are sought (i.e., specialty work), which may be beyond the designer’s expertise. CDOT and the University of Colorado have jointly developed a Procurement Procedures Selection Matrix (PPSM) to provide a risk-based and objective selection approach to choosing a procurement procedure from the three common procurement criteria of low bid, best value, and best qualified. The PPSM is available on the CDOT website at https://www.colorado.edu/ tcm/procurement-procedure-selection-matrix. More information on the PPSM can be found in Section 12.5.

142 Strategies for Work Zone Transportation Management Plans 8.3.3 Benefits The use of A+B contracting provides the following benefits: • Reduces construction-induced congestion and delays. • Encourages bidders to develop more detailed and well thought out plans. • Encourages contractors to develop innovative means of reducing overall construction time at the lowest cost. • Encourages contractors to schedule construction operations in a manner that maximizes the efficiencies of crews and equipment. • Encourages the contractor to find ways to make up for days lost to weather. • Reduces complaints related to congestion from road users and local communities. • Lessens environmental impacts and reduces pollution related to construction. 8.3.4 Expected Effectiveness Kent (2008) summarized the performance results of 120 NYSDOT A+B bidding projects worth almost $2 billion: • On average, contractors bid 32 percent less than the agency’s estimated time and completed ahead of schedule. • NYSDOT awarded 90 of the 120 contracts to the low A portion bidder (i.e., the bidder with lowest A+B total also had the lowest A portion contract amount). The agency awarded the other 30 contracts to a bidder with a higher A cost and a shorter B duration. The added A cost of these 30 contracts was less than 1 percent. • 103 contractors earned incentives and shared total incentive payments of $49,069,174. Total incentives paid were approximately 2.5 percent of original contract value for these 103 contracts. • The agency fined 8 contractors for not completing projects on time (i.e., disincentive). The total cost of fines was $592,000. • 59 contractors asked for and received adjustments to the B portion of the contract because of circumstances outside of their control. • Cost saving was estimated to be $246 million. • Construction time saved was estimated to be 20,000 days. The Iowa DOT used A+B bidding—in combination with other strategies—to reduce con- struction time from 2 years to 1 year on the 24th Street-I-29/80 Interchange Bridge replacement project in Council Bluffs in 2009. A+B was selected to reduce the project-delivery time and open all lanes on the new bridge within one construction season (April–October). 8.3.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.3.6 Implementation Considerations An issue to consider with A+B bidding is the potential for project costs to increase. State agencies will need to consider that shortening the duration of a project will cost a premium related to acceleration, aggressive management of subcontractors, the use of specialty equipment, or a combination of any of the three. For example, a bidding firm may see an opportunity to reduce the total effects on a project with a shorter duration solution that increases the primary

Alternative Contracting and Construction Strategies 143 cost items, but in return would reduce the impact on overall traffic control cost. However, a bidding firm would not likely bid the shorter duration, as savings associated with traffic control are not shared with the firm. To avoid this situation, state DOTs may implement incentive/ disincentive clauses. 8.3.7 Design Features and Requirements According to Caltrans (2002), other than a few specific exceptions, projects that agencies should consider for A+B bidding are those having an estimated cost of $5 million or more and a daily RUC of $5,000 or more. Once the agency establishes these parameters, the project engi- neers establish a maximum number of construction days for bids to be considered responsive. Any bids that exceed this amount are considered unresponsive and are discarded. Next, the project engineers determine the daily RUC for the time portion of the bids. To evaluate the proposals, the agency will multiply the estimated duration of construction by the RUC to create the time portion of the bid. This B value is added to the project cost (the A portion) to generate the total bid. Caltrans will award the contract to the firm with the lowest total A+B. 8.3.8 State of the Practice Under SEP-14, 29 States (Arkansas, California, Colorado, Delaware, Georgia, Idaho, Indiana, Iowa, Kentucky, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New York, North Carolina, North Dakota, Oklahoma, Pennsylvania, South Carolina, Texas, Utah, Vermont, Virginia, Washington, and Wisconsin) and the District of Columbia have used the A+B method. The FHWA Highways for Life Demonstration Program web page (https://www.fhwa.dot.gov/ hfl/projects/) provides a list of projects that used the A+B approach. 8.3.9 Cost A+B is a planning strategy and there is no separate cost for its implementation. The costs associated relate to in-house staffing resources to develop or manage a project, or both. 8.3.10 Resources and References Anderson, S. D., and J. S. Russell. NCHRP Report 451: Guidelines for Warranty, Multi Parameter, and Best Value Contracting. TRB, National Research Council, Washington, D.C., 2001. Caltrans. Guidelines for Use of A+B Bidding Provision, California Department of Transportation, September 2002. Kent, D. Innovative Contracting Techniques That Consider Driver Impact, Use of A+B Bidding, New York State Department of Transportation, 2008. Mallela, J., and S. Sadasivam. Work Zone Road User Costs: Concepts and Applications, FHWA-HOP-12-005, FHWA, U.S. DOT, 2011. WSDOT. A+B Bidding, Washington Department of Transportation, 2014. 8.4 Incentive/Disincentive Clauses 8.4.1 Description An incentive is a contracting provision that compensates the contractor a specific amount of money for each day that critical work is completed ahead of schedule or for achieving set goals. A disincentive assesses a fee for each day identified that the contractor overruns the

144 Strategies for Work Zone Transportation Management Plans specified time or for failing to achieve set goals. Contracts may pair these two provisions in an incentive/disincentive (I/D) clause. 8.4.2 When to Use Preferred candidate projects for I/D use are the following: • Projects on high traffic-volume facilities, generally in urban areas. • Major reconstruction or rehabilitation that will severely disrupt traffic on a facility. • Projects with lengthy detours. • Projects with critical completion dates. • Projects that involve nighttime construction. • Projects with significant road-user delay costs or community or local business impacts. I/D use is not suitable for • Projects with open-to-traffic constraints, such as weekends to accommodate seasonal peak volumes or extended periods for special events, which significantly limit the number of work hours or days per week. • Projects with third-party coordination concerns, such as utility relocations. Pyeon and Lee (2012) developed a systematic procedure to determine appropriate I/D dollar amounts using the Construction Analysis for Pavement Rehabilitation Strategies (CA4PRS) scheduling tool. The procedure is shown in Figure 8.1 and briefly summarized in the follow- ing steps: • Step 1. Set up a schedule baseline based on CA4PRS schedule analysis. • Step 2. Evaluate the impact of the work zone on the traveling public, especially RUC based on CA4PRS traffic analysis. • Step 3. Estimate the contractor’s cost for additional resources for I/D acceleration and the contractor’s savings from schedule compression. Also, estimate the contractor’s savings in field-operation cost by using project duration reduction results from the schedule acceleration. • Step 4. Estimate the agency’s cost savings from schedule compression. • Step 5. Use sensitivity analysis to determine the reasonable value of discount factors to split I/D benefits and costs between the contractor and the agency. • Step 6. Make a decision on the I/D implementation based on the comparison of savings for the contractor (i.e., additional acceleration cost savings and field-operation cost savings) and benefits to road users and the agency from schedule compression. • Step 7. Set up a daily incentive amount and a maximum incentive amount based on Steps 1–6, as well as project budget constraints. • Step 8. Set up a daily disincentive amount and a maximum disincentive amount based on the previously described procedure and parameters. 8.4.3 Benefits The use of I/D clauses provides the following benefits: • Earlier project completion or open-to-traffic date. • Minimizes impacts to motorists and the community. • Improves worker safety. • Reduces road-user delay costs. • Encourages contractor efficiency and productivity. • Provides disincentives for failing to meet contract completion or open-to-traffic date.

Alternative Contracting and Construction Strategies 145 Figure 8.1. Flowchart of systematic procedures for determination of I/D dollar amount.

146 Strategies for Work Zone Transportation Management Plans 8.4.4 Expected Effectiveness Sun, Edara, and Mackley (2012) examined the effectiveness of 20 MoDOT I/D contracts from 2008 to 2011 and evaluated the extent to which they mitigated work zone traffic effects. In considering an average project, the percentage of RUC savings was around 13 percent of the total contract amount, or $444,389 of $3,464,620. The net RUC savings were about $7.2 million after subtracting the approximately $1.7 million paid in incentives. In other words, every dollar paid in incentives resulted in approximately $5.30 of RUC savings. Ellis et al. (2007) performed a comprehensive quantitative evaluation on FDOT construction projects. A total of 144 I/D projects were evaluated and compared with traditional DBB, non-I/D contracting projects. The quantitative project cost and time evaluation results indicated that I/D projects showed average time savings of 16.5 percent but average cost overruns of 3.3 percent. Arditi, Khisty, and Yasamis (1997) studied several projects for IDOT and found that 93.3 percent of projects that used I/D provisions finished on time or ahead of schedule compared with 41.4 percent that did not use I/D provisions. 8.4.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.4.6 Implementation Considerations All I/D provisions are used in conjunction with liquidated damages. In other words, the disincentive portion of an I/D provision consists of more than just the minimum agreed-to daily engineering construction costs that will be recovered if a milestone or project is completed late. RUC is the most common item included in both the incentive and disincentive rates for a highway project. The total incentive amount available needs to be included in both the project estimate and the programming, and the amount should be less than or equal to the associated RUC (or a maximum of 5% of the estimated construction costs). The I/D assessment must be large enough to motivate the contractor to work an accelerated schedule. Agency costs can be higher for I/Ds because staffing hours will be increased to monitor contract time and impacts associated with excusable delays. Critical path–method scheduling should be considered to facilitate tracking of time adjustments. Time adjustments from change orders or delays can become a major source of dispute on projects with I/D provisions. Calendar days should be used to avoid any potential for controversy, with exceptions for weather and legal holidays. 8.4.7 Design Features and Requirements As I/D is a contract provision, design features and requirements are not applicable to this strategy. 8.4.8 State of the Practice NCHRP Report 652: Time-Related Incentive and Disincentive Provisions in Highway Construc- tion Contracts (Fick et al. 2010) states that at least 46 states have had experience with contracts involving some variation of I/D provisions.

Alternative Contracting and Construction Strategies 147 8.4.9 Cost I/D is a planning strategy and there is no separate cost for its implementation. The costs associated relate to in-house or consultant-staffing resources to develop and manage a project. However, agency costs for projects with I/D provisions can be higher because staffing hours will be increased to monitor contract time and impacts associated with excusable delays. 8.4.10 Resources and References Arditi, D., J. Khisty, and F. Yasamis. Incentive/Disincentive Provisions in Highway Contracts, Journal of Construc- tion Engineering and Management, 123, 1997, pp. 302–307. Ellis, R., J. Pyeon, Z. Herbsman, E. Minchin, and K. Molenaar. Evaluation of Alternative Contracting Techniques on FDOT Construction Projects, Final Report, Florida Department of Transportation, July 2007. Fick, G., E. T. Cackler, S. Trost, and L. Vanzler. NCHRP Report 652: Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Transportation Research Board of the National Academies, Washington, D.C., 2010. Pyeon, J.-H., and E. B. Lee. Systematic Procedures to Determine Incentive/Disincentive Dollar Amounts for Highway Transportation Construction Projects, California Department of Transportation, CA-MTI-12-2908, June 2012. Sillars, S. N. Establishing Guidelines for Incentive/Disincentive Contracting at Oregon DOT, FHWA-OR-RD-07-07, Oregon Department of Transportation, 2007. Sun, C., P. Edara, and A. Mackley. Use of Incentive/Disincentive Contracting to Mitigate Work Zone Traffic Impacts, Midwest Smart Work Zone Deployment Initiative, InTrans Project 06-277, November 2012. 8.5 No-Excuse Incentives 8.5.1 Description A no-excuse incentive (NEI) is a monetary incentive for early completion, for which the contractor receives the bonus by completing the work on or before a drop-dead date that cannot be adjusted for any reason. The contractor receives the full incentive payment for work completed on or in advance of this date. There are no excuses for adjusting this date, including utilities, permitting, change orders, weather, site conditions, or any other cause short of a natural catastrophe. Conversely, the contractor is not assessed disincentives, aside from normal liqui- dated damages, for not meeting the completion date. The incentive amount is based on RUC and other costs that reflect the value to the agency and the public for finishing the project by a certain date. NEI is also known as a locked incentive date or a no-excuse bonus. 8.5.2 When to Use An NEI should be considered for use under the following situations: • Projects for which finishing early would provide some benefit but finishing late would cause severe damages (e.g., projects with an arrangement of multiple construction contracts for which finishing late would cause collateral effects to subsequent contractors, a road opening to accommodate major traffic events). • Projects with critical completion dates, such as a major sporting event. • Projects with high RUC, impacts to the local and business communities, or both. 8.5.3 Benefits The use of an NEI provides the following benefits: • Enables an earlier project completion or open-to-traffic date. • Minimizes impacts to motorists or the community.

148 Strategies for Work Zone Transportation Management Plans • Improves worker safety. • Reduces road-user delay costs. • Encourages contractor efficiency and productivity. 8.5.4 Expected Effectiveness In 2010, MnDOT successfully used the NEI specification on six projects to deliver them within the anticipated project schedule. MnDOT reported that NEIs motivated contractors to complete the work instead of asking for time extensions, eliminated claims, and improved the working relationship with MnDOT. Affected stakeholders were satisfied that MnDOT was able to meet construction commitment dates and reduce construction impacts. 8.5.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.5.6 Implementation Considerations An NEI provision remains as a nontraditional contracting technique under SEP-14 and requires FHWA approval before being used. The total incentive amount available needs to be included within both the project estimate and the programming, and it should be less than or equal to the associated RUC (or a maximum of 5 percent of the estimated construction costs). The bonus can be tied to milestones, a final completion date, or both. An effective NEI provision will clearly state the incentive amount, all the relevant work items, a substantial completion definition, the unit of time used, and the no-excuse completion date. The owner and the contractor need well-defined time limits for submittals, reviews, and any other administrative issues within the contract and the project schedule. Ambiguities will complicate contract administration. Utility schedules are crucial, requiring the utility companies to also increase staffing or work overtime. Contractors may commit to sharing bonuses with utility companies, subs, and others to get these companies or groups to commit to working toward a bonus. Alternatively, the owner may establish contingency funds to cover the increased workload. 8.5.7 Design Features and Requirements As NEIs are a contract provision, design features and requirements are not applicable to this strategy. 8.5.8 State of the Practice About 13 state DOTs (Alabama, Florida, Georgia, Iowa, Massachusetts, Minnesota, Missouri, North Carolina, Pennsylvania, South Carolina, Virginia, Wisconsin, and Wyoming) use NEI provisions. Florida and Minnesota have used this provision to a greater extent than other states. Case studies of NEI projects can be found on the FHWA SEP-14 Active Project web page (https://www.fhwa.dot.gov/programadmin/contracts/sep14list.cfm). 8.5.9 Cost This strategy is an innovative contracting strategy and there is no additional cost to implement this strategy.

Alternative Contracting and Construction Strategies 149 8.5.10 Resources and References AASHTO. No Excuse Incentive Provisions Survey, AASHTO Subcommittee on Construction, Contract Adminis- tration Section, Washington, D.C., May 2010. MnDOT. Locked Incentive Date (LID) Evaluation Report, Minnesota Department of Transportation, December 2010. 8.6 Lane Rental 8.6.1 Description Lane rental is a payment provision used by agencies to minimize the effects of a project on the traveling public. It is a method of transferring roadway user costs to the contractor. The contractor must rent a lane to close it. This creates a monetary incentive for the contractor to be innovative and minimize the duration of lane closures. The contractor makes decisions that consider the roadway user costs, both during the bid and as the contract progresses. The contractor’s bid consists of a combination of the cost to perform the work (component A) with the cost of the impact to the public (component B) to provide the lowest cost to the public. By providing a more aggressive scheduling package, a contractor may be able to gain a competitive advantage by decreasing the overall effect to the traveling public and thereby reducing the amount for bid consideration. 8.6.2 When to Use Lane-rental provisions are adequate in projects with long, unavailable, or impractical detours, and when peak hour traffic is adversely affected. Agencies should use lane-rental provisions in projects that include multiple roads and high traffic volumes, as well as some flexibility for intermittent or temporary lane closures, significant RUC, and high community and local business impacts. According to the MnDOT Innovative Contracting Guidelines (2008) and NCHRP Report 652, good candidates for the use of these provisions include projects that involve the following features: • Bituminous mill and overlay, • Grading, • Full-depth patching, • Diamond grinding, • Full-depth reclamation, • Cold recycle, • Guardrail projects (replacement and installation), • Sign upgrades, • Pavement marking, • Crack sealing, and • Signal systems. 8.6.3 Benefits The use of lane rental provides the following benefits: • Helpful for contractors scheduling work to minimize traffic restrictions in duration and lane closures. • Ideal for projects that significantly affect the traveling public (i.e., reduces RUC). • Useful in major urban area projects and rural projects with flagging operations.

150 Strategies for Work Zone Transportation Management Plans 8.6.4 Expected Effectiveness According to the MDOT Innovative Construction Contracting Guide (2015), lane-rental provi- sions encourage contractors to set work schedules that keep lane closures to a minimum. FHWA report Work Zone Road User Costs: Concepts and Applications (Mallela and Sadasivam 2011) recognizes that lane rental can accomplish the following: • Reduce work zone RUC. • Positively affect work zone safety. • Encourage contract efficiency and productivity. • Better accommodate local traffic flow. 8.6.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.6.6 Implementation Considerations FHWA report Work Zone Road User Costs—Concepts and Applications identifies the following disadvantages of lane-rental provisions: • Contractors are likely to plan work at night, which may reduce worker safety. • Project completion time does not necessarily decrease. • Additional agency resources are required. • Contract change negotiations become more difficult. • Additional documentation and coordination are required. The following factors are important when selecting lane rental for a project: • Traffic restrictions or lane closures with no (or limited) alternate routes result in a high user cost. • The project is free of third-party conflicts outside the control of the contract (e.g., right- of-way, utility, environmental). • There is a high degree of confidence that design uncertainties have been addressed in the plans. • A reasonable contractor can accurately schedule (and bid) the necessary lane closures to complete the work as described. • “Closures” can be well defined. • Opportunities exist to reduce closure times. • User fees are substantial enough to offset the cost of the effort to reduce the closure time. Safety needs to be addressed with every lane-rental project. Plans and specifications should identify cases when lane closures will be required, decreasing the chance that contractors will take safety risks to reduce lane-rental charges. 8.6.7 Design Features and Requirements Lane-rental fee rates depend on the number and type of lanes closed and can vary for different hours of the day. For example, the peak hour periods of 6:00 to 9:00 a.m. and 3:00 to 6:00 p.m. could have an hourly rental fee of $2,000 for closing one lane, while a lane closed at any other time could have a rental fee of $500 per hour. The incentive for lane rental is limited to a maximum of 5 percent of the estimated construc- tion cost. The maximum incentive is determined and listed in the special provision for lane rental as “Lane Rental, Incentive.” The incentive payment will be determined by subtracting

Alternative Contracting and Construction Strategies 151 from the contract lane-rental lump sum bid by the contractor the total lane-rental assessments, which cannot exceed the maximum. For example, if a contractor bids $1 million (lump sum) for lane rental and the total of the lane-rental assessments is $900,000 based on 900 hours at $1,000 per hour, then the lane-rental incentive equals $100,000, provided it does not exceed the maximum incentive listed in the special provision. 8.6.8 State of the Practice Arizona, Colorado, Indiana, Maine, New York, North Carolina, Oklahoma, and Washington have experimented with or implemented the use of lane-rental provisions. 8.6.9 Cost Lane rental can increase construction cost. On a standard project, a contractor may see an opportunity to reduce total impacts. A shorter-duration solution may increase the primary item cost but reduce lane rental and overall traffic control costs. The contractor will try to determine the most advantageous bid while balancing the potential overrun in lane-rental costs. 8.6.10 Resources and References FDOT. Contract Duration and Alternative Contracting Techniques, Florida Department of Transportation, Tallahassee, March 2012. Fick, G., E. Cackler, S. Trost, and L. Vanzler. NCHRP Report 652: Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Transportation Research Board of the National Academies, Washington, D.C., 2010. Mallela, J., and S. Sadasivam. Work Zone Road User Costs: Concepts and Applications, FHWA, U.S. DOT, Washington, D.C., 2011. MDOT. Innovative Construction Contracting Guide, Michigan Department of Transportation, 2015. MnDOT. Innovative Contracting Guidelines, Office of Construction and Innovative Contracting, Minnesota Department of Transportation, December 2008. UDOT. Lane Rental Guidelines, Utah Department of Transportation, April 2010. WSDOT. Lane Rental, Washington State Department of Transportation, 2013. 8.7 Value Engineering 8.7.1 Description Value engineering (VE) is defined as a systematic process of review and analysis of a project, during the concept and design phases, conducted by a multidisciplinary team of persons not involved in the project. 8.7.2 When to Use VE studies can occur at one or more stages of project development. • VEs can be conducted at the scoping (conceptual) stage before commencing design activity. • VEs can occur at the preliminary field inspection stage, or when approximately 30 percent of the design is complete. At this point, the project design is at a stage when the team can make recommendations on its alignment and overall design without concern that changes will affect the project schedule. • VE study is also appropriate when approximately 60 percent of the design is completed. At this stage, the VE team has access to more complete project information, including most of the specific items to be included in the completed roadway. Cost estimates are more likely to be complete at this stage. On federal-aid highway projects, the FHWA can withhold federal-aid highway funds from any eligible project that did not receive a VE study.

152 Strategies for Work Zone Transportation Management Plans 8.7.3 Benefits A VE program provides a definitive tool to improve value in any project, product, or process. Cost savings, reduced risk, improved schedule, enhanced design, and quality have been common outcomes of VE studies. Additional benefits include review of design and construction standards to improve quality and reduce project completion time. 8.7.4 Expected Effectiveness FHWA and state DOTs have recognized tens of millions of dollars in project cost savings from completed VE studies. These savings represent a return on investment of over 100:1 when considering the cost of conducting the VE studies. FHWA annually collects information on VE accomplishments achieved within the Federal- Aid Highway Program, including for the projects administered by Federal Lands Highway. For VE studies conducted during the preconstruction phase, FHWA tracks the number of studies conducted, proposed and implemented recommendations, and the value of the implemented recommendations. Table 8.2 summarizes recent savings realized by conducting VE studies. MnDOT has recognized tens of millions of dollars in project cost savings from completed VE studies. These savings represent a return on investment of 84:1 when considering the cost of conducting the VE studies. Table 8.3 is a summary of 5 years of VE studies from October 1, 2012 to June 30, 2018. Caltrans realized cost savings of $62 million on nine projects that completed VE studies during FY 2017–18. The VE recommendations, in most cases, reduced the cost of the project. However, in a few cases the recommendations resulted in an increase to the cost of the project but resulted in improved project performance. Table 8.4 identifies the value of the alternative per project. 8.7.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.7.6 Implementation Considerations Large, complex projects must have at least two VE studies, first at a scoping or corridor level, followed up with a second study later in the project-development phase. Measure FY 2019 FY 2018 FY 2017 FY 2016 FY 2015 FY 2014 Number of VE Studies 246 175 160 198 135 215 Cost to Conduct VE Studies and Program Administration $12.5 M $7.3 M $6.6 M $7.3 M $6.4 M $8.7 M Estimated Construction Cost of Projects Studied $32 B $22.7 B $20.8 B $13.9 B $14.1 B $20.9 B Total Number of Proposed Recommendations 2,310 1,376 1,451 1,565 1,233 1,664 Total Value of Proposed Recommendations $5.5 B $3.1 B $2.8 B $2.6 B $2.5 B $3.0 B Number of Approved Recommendations 801 578 636 579 504 697 Value of Approved Recommendations $3.1 B $1.1 B $1.1 B $868 M $831 M $1.73 B Project Cost Saved (%) 10.00 5.00 5.00 6.20 5.90 8.32 Return on Investment 247:1 157:1 159:1 119:1 129:1 200:1 NOTE: B = billion; M = million; VE = value engineering. Table 8.2. Summary of past VE savings on Federal-Aid and Federal Lands Highway Programs.

Alternative Contracting and Construction Strategies 153 Project Name VE Study Construction Cost VE Study Savings Associated Costs Project Savings Sac 5 HOV Lanes and Rehab Improvement: Combined two nearby projects and adjusted work windows to allow for precast slab replacement $168,000,000 $1,534,000 $72,000 $1,462,000 Sac 5 HOV Lanes and Rehab Project combined with the previous project $165,000,000 $2,751,000 $52,000 $2,699,000 Mon 101 Pavement Rehab, PM 36.9 to 47.7 Improvement: Increased ramp closures to allow for pavement curing in lieu of precast slabs $49,800,000 $ 6,445,000 $42,000 $6,403,000 Mon 101 Seismic Retrofit The results of the geotechnical studies eliminated the need for cast-in-steel-shell piles. Another alternative was eliminated after a project scope reduction. $29,800,000 $0 $46,000 ($46,000) Mon 101 PM 87.3 to PM 91.5 None of the study alternatives was accepted because of geometric concerns. $35,200,000 $0 $49,000 ($49,000) Ker 99 Roadway Rehab None of the study alternatives was implemented because they did not add value . $79,000,000 $0 $52,000 ($52,000) LA 60 Pavement Rehab The VE study identified user benefits that outweighed the slight increase in cost. $109,000,000 ($1,080,000) $52,000 ($1,132,000) Riv 10 Pavement Replacement Improvement: Changed pavement type because of median rebuild and saved Thrie-beam barrier verses replacement $239,000,000 $47,200,000 $47,000 $47,153,000 SBD 60 Pavement Replacement Improvement: Changed pavement type because of lane closure time frames $92,000,000 $5,200,000 $48,000 $5,152,000 Total $ 966,800,000 $62,050,000 $460,000 $61,590,000 NOTE: HOV = high-occupancy vehicle; VE = value engineering. Table 8.4. Caltrans VE studies for FY 2017–18. Measure 10/1/2012– 6/30/2014 7/1/2014– 6/30/2015 7/1/2015– 6/30/2016 7/1/2016– 6/30/2017 7/1/2017– 6/30/2018 Number of VE Studies 13 10 16 4 5 Cost of Conducting VE Study $634,000 $463,000 $865,000 $252,908 $286,579 Estimated Total Project Cost $ 923 M $ 397 M $ 817 M $122 M $447 M No. of Proposed VE Recommendations 107 58 128 27 32 No. of Approved Recommendations 72 43 95 15 14 Recommendation Acceptance Rate (%) 67 74 74 56 44 Total Value of Proposed VE Savings $191.7 M $38.8 M $123.5 M $11.7 M $79.5 M Savings from Approved Recommendations $60.1 M $17.29 M $78.36 M $9.9 M $44.8 M Total value of approved recommendations $210.45 M Total cost to hold the VE studies $2.5 M ROI = value of approved recommendations divided by cost to conduct VE studies 84:1 Total number of VE studies over 10 years 48 NOTE: M = million; MnDOT = Minnesota Department of Transportation; ROI = return on investment; VE = value engineering. Table 8.3. Summary of MnDOT VE savings.

154 Strategies for Work Zone Transportation Management Plans It is important to hold the VE study early enough during the project-development phase to incorporate acceptable VE recommendations. The letting may be delayed if there is not enough time to incorporate recommendations into the plans. Per industry best practice, the ideal time to do a VE study is in or near the scoping and preliminary design phase or near the time when design alternatives are being examined and the public is fully engaged. Enough engineering must have taken place such that the design framework is sufficient to operate from, but it is best if significant commitments have not been made. VE studies are strongly suggested to be a minimum of 4 days, with 5 days most desirable. Teams typically are multidisciplinary and consist of 5 to 8 individuals who are not personally involved in the design of the project. Depending on the size and complexity of the project, the number of members in a VE team may exceed that range. However, a minimum of 5 individuals is required, as a team of fewer than 5 tends to limit the amount and variety of creative input. 8.7.7 Design Features and Requirements As VE is a project management strategy, the parameters of each study will depend upon the project and the team involved. 8.7.8 State of the Practice FHWA collects information annually on VE accomplishments achieved within the Federal- Aid Highway Program, including the projects administered by Federal Lands Highway. For VE studies conducted during the preconstruction phase, the FHWA tracks the number of studies conducted, proposed and implemented recommendations, and the value of the implemented recommendations. Additionally, similar information is compiled for the VE change proposals submitted by contractors during the construction of the projects. This information is available in the Federal-Aid Value Engineering Summary Reports at https://www.fhwa.dot.gov/ve/ vereport.cfm. In FY 2018, 175 VE studies were conducted by all the state DOTs. States with the most VE studies conducted are California (20), Florida (23), Michigan (10), North Carolina (10), and Texas (28). 8.7.9 Cost The cost to conduct a VE study varies depending on the complexity of the project and can range anywhere from $15,000 to over $1 million. 8.7.10 Resources and References AASHTO. Guidelines for Value Engineering, 3rd edition, 2010. California Department of Transportation (Caltrans). Annual Efficiencies Report to the California Transportation Commission: Fiscal Year 2017–2018, n.d. 8.8 Accelerated Bridge Construction 8.8.1 Description According to FHWA, ABC uses innovative planning, design, materials, and construction methods in a safe and cost-effective manner to reduce the on-site construction time that occurs when building new bridges or replacing and rehabilitating existing ones.

Alternative Contracting and Construction Strategies 155 The use of prefabricated bridge elements and systems (PBES) and SPMTs are typical in ABC projects. PBES are structural components of a bridge (e.g., footings, piers, pier caps, abutments, bridge decks, railings) that are built off site or adjacent to the alignment. An SPMT is a platform vehicle used for transporting massive objects, such as bridges, large bridge sections, and other objects too big or heavy for trucks. SPMTs are used to expedite bridge superstructure removal and construction. After the bridge is removed with the SPMT, the PBESs are transported into position and placed using the SPMT. 8.8.2 When to Use ABC is applicable for critical or high-volume facilities for which the societal costs of closure or loss of mobility are considered significant. To provide a rational and consistent method of selecting appropriate ABC projects, FHWA and some states developed the following decision-making tools. The first ABC decision-making approach was developed by FHWA in 2005 based on a frame- work for PBES decision-making. In this framework, a flowchart and matrix incorporating decision criteria are used to help decision makers choose between conventional and ABC alter- natives. The flowchart assists the users in making a high-level decision on whether a prefabricated bridge might be an economical and effective choice for the specific bridge under consideration (Figure 8.2). The matrix provides users with additional details and may provide additional assistance in making a high-level decision about the type of construction and approach to apply to a particular project. A number of state DOTs have developed their own ABC decision-making tools as they work to implement ABC in their states. Foremost in this effort is the 2012 pooled-fund project led by the Oregon DOT to develop a decision tool to help determine whether a project is a good candidate for ABC. This software, the ABC Decision Tool, is being used in several states.13 UDOT developed an Excel-based ABC rating procedure and decision flowchart in 2010, with an update in 2014. This tool assesses the project under consideration against eight main factors: ADT, delay/detour time, bridge classification, user costs, economy of scale, use of typical details, safety, and railroad impacts.14 Similarly, in 2017 MnDOT developed a three-stage process to assist in determining which bridges are best suited for ABC. Complete details for each of the three stages are included on the Bridge Office ABC website at http://www.dot.state.mn.us/bridge/abc/. 8.8.3 Benefits According to FHWA EDC-2, benefits to employing ABC include the following: • Reduced construction time. Decreasing construction time directly benefits the public by significantly reducing traffic delays and road closures. • Reduced agency costs. ABC can be the most cost-effective means of construction, especially when total project costs, including ROW acquisition, project administration, maintenance of traffic, environmental mitigation utility relocation, and escalation or railroad-flagging costs are considered. 13 The user manual for the Oregon DOT ABC decision-making software is found at https://www.fhwa.dot.gov/bridge/abc/ dmtool/software_manual.cfm. 14 The UDOT ABC Decision Making Process tool can be downloaded at https://www.udot.utah.gov/main/f?p=100:pg:0:::1: T,V:4356,.

156 Strategies for Work Zone Transportation Management Plans Figure 8.2. Flowchart for high-level decision on whether a prefabricated bridge should be used in a certain project (Credit: FHWA). • Reduced user costs. ABC dramatically reduces work zone RUC associated with bridge construction projects on existing roadways. • Improved motorist and worker safety. Limiting the duration of traffic impacts reduces the exposure to work zone crashes, increasing safety for both construction workers and the traveling public. • An effective solution to environmentally sensitive areas. ABC technologies may also be an effective solution or alternative in areas where construction may be constrained or delayed by environmental considerations or limitations. 8.8.4 Expected Effectiveness ABC projects have reported significant reductions in construction time, thereby reducing road-user delays and reducing workers’ exposure. The FHWA Highways for Life Demonstration

Alternative Contracting and Construction Strategies 157 Projects web page (https://www.fhwa.dot.gov/hfl/projects/) provides a list of projects constructed using the ABC technique. A review of example projects indicates that ABC had the following advantages: • Reduced construction time by more than 2 months, preventing an estimated 58 crashes (reconstruction of I-25 Bronco Arch Bridge, Denver, Colorado, July 2015). • Reduced construction time by 8 months resulting in user cost savings of approximately $2.24 million, preventing an estimated 15 crashes (I-70 bridge replacement, Denver, Colorado, October 2014). • Reduced construction time by 39 months, resulting in user cost savings of approximately $136 million (reconstruction of Fourteen Bridges on I-93, Medford, Massachusetts, October 2014). 8.8.5 Crash Modification Factor A CMF is not applicable; however, alternative contracting and construction strategies reduce construction time and impact to motorists and workers, which improves overall work zone safety. 8.8.6 Implementation Considerations Acceleration of construction should not sacrifice the quality of construction or design. Any process performed too quickly has the potential to sacrifice quality. This is particularly true in the application of prefabricated materials. Such materials can often be constructed off site and out of the presence of construction inspectors. Thus, careful inspection of the respective materials is extremely important. Plant inspection agreements and fabrication certifications can be established to ensure this careful inspection. It is important that the values for incentives and for penalties established for the contract be properly balanced. Furthermore, agencies need to be able to accurately estimate reasonable completion dates and critical milestones. Finally, the work needs to be carefully planned, with appropriate safety precautions incorporated, to ensure production pressures do not lead to shortcuts that reduce safety or increase risk to workers. 8.8.7 Design Features and Requirements The majority of the design and construction specification needs for an ABC project are contained in the AASHTO Load and Resistance Factor Design Bridge Design Specifications and the AASHTO Load and Resistance Factor Design Bridge Construction Specifications. 8.8.8 State of the Practice California, Colorado, Florida, Iowa, Minnesota, Oregon, Utah, and Washington are examples of state DOTs that frequently use an ABC approach. Examples of ABC projects are widely available on state DOT websites and are not repeated here to avoid duplication. Instead, readers are requested to refer to the web pages discussed below for more information on ABC. UDOT has championed and widely implemented ABC, the use of ABC is now common practice throughout the state, and Utah is seen as a national leader for ABC. Since 2010, UDOT has used ABC on more than 200 bridges. Examples of ABC projects implemented by UDOT can be found on their Project Highlights web page at https://www.udot.utah.gov/main/f?p= 100:pg:0:::1:T,V:2125,.

158 Strategies for Work Zone Transportation Management Plans In 2013, RITA (under U.S. DOT) provided funding to establish and operate the ABC Univer- sity Transportation Center (ABCUTC) at Florida International University. ABCUTC includes detailed documents on ABC/PBES projects that have been successfully built within the United States. The detailed information includes plans, schedule, photos, and a project summary report. The list of ABC projects can be found at http://utcdb.fiu.edu/search?. The FHWA Highway for Life Demonstration Project web page (https://www.fhwa.dot.gov/ hfl/projects/) provides a list of projects constructed using the ABC technique. The FHWA EDC initiative has assisted in the development of many projects employing ABC technologies. In 2010, the EDC-1 bridge innovations were PBES and geosynthetic reinforced soil-integrated bridge systems (GRS-IBS). In 2011–2012, more than 1,000 bridges were built in an accelerated manner using some form of PBES technology. In 2012, the EDC-2 bridge innovations were PBES, GRS-IBS, and lateral-slide technologies. In 2013–2014, the number of bridges built with PBES technologies increased significantly. In 2014, the 11 EDC-3 innovations include GRS-IBS and ultra high performance concrete connections for prefabricated bridge elements. 8.8.9 Cost The costs for accelerated construction depend on the project characteristics. However, projects reviewed indicated that construction time is reduced, resulting in savings in RUC and an overall safer project. 8.8.10 Resources and References Anderson, S. D., and I. Damnjanovic. NCHRP Synthesis 379: Selection and Evaluation of Alternative Contracting Methods to Accelerate Project Completion. Transportation Research Board of the National Academies, Washington, D.C., 2016. https://doi.org/10.17226/23075. Culmo, M. P. Accelerated Bridge Construction: Experience in Design, Fabrication and Erection of Prefabricated Bridge Elements and Systems, FHWA-HIF-12-013, FHWA, U.S. DOT, November 2011. Doolen, T., A. Saeedi, and S. Emami. Accelerated Bridge Construction (ABC) Decision Making and Economic Modeling Tool, Federal Highway Administration, FHWA-OR-TPF-12-06, December 2011. Lee, J. H., and B. McCullouch. Review Construction Techniques for Accelerated Construction and Cost Implications, Project No. C-36-67 WWWW, Purdue University, West Lafayette, Ind., August 2009. NCHRP Project 20-68A, Scan 07-02, “Best Practices in Accelerated Construction Techniques.” National Cooperative Highway Research Program, Transportation Research Board. Washington, D.C., 2009. Pyeon, J., and E. B. Lee. Systematic Procedures to Determine Incentive/Disincentive Dollar Amounts for Highway Transportation Construction Projects, California Department of Transportation, CA-MTI-12-2908, June 2012. WisDOT. Transportation Synthesis Reports: Accelerated Construction Techniques, Wisconsin Department of Transportation, October 22, 2004.

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One of the ways a state department of transportation or other transportation agency can address work zone safety and other impacts is to develop and implement a transportation management plan (TMP).

The TRB National Cooperative Highway Research Program's NCHRP Research Report 945: Strategies for Work Zone Transportation Management Plans provides a practitioner-ready guidebook on how to select and implement strategies that improve safety and traffic operations in roadway construction work zones.

Supplemental materials to the report include NCHRP Web-Only Document 276: Evaluating Strategies for Work Zone Transportation Management Plans; fact sheets on ramp meters, reversible lanes, and truck restrictions; and guidebook appendices.

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