Managing Enhanced Risk in the Mega Project Era (2022)

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Background State highway departments and transportation agen- cies have a continuing need to keep abreast of operat- ing practices and legal elements of specic problems in highway law. e NCHRP Legal Research Digest and the Selected Studies in Transportation Law (SSTL) series are intended to keep departments up-to-date on laws that will aect their operations. Foreword Mitigating and controlling risks is necessary for ensuring the successful construction of highway mega projects. is legal digest addresses the change in risk proles of larger transportation projects in terms of size, project delivery methods, and legislation. It examines the man- ner in which standard contract provisions must be mod- ied to allocate risks, in accordance with the enhanced scope of the project. is is presented through example excerpts of contract provisions used on mega projects. e digest is categorized following the construction project phases, starting from planning to pre-award, and then to post award. e planning stage include risks related to government approvals, environmental requirements, funding, hazardous materials manage- ment, and agreements with third parties (including rights-of-way, utilities, and railroad agreements). e pre-award stage includes risks related to procurement and selection procedures, insurance, bonding, and war- ranty requirements, contract payment, and incentive/ disincentive terms. e nal post award stage includes risks related to design defects, types of damages, pro- visions limiting damages, changes (including diering site conditions, force majeure events, changes in law, discovery of archaeological, paleontological, or cultural resources, and discovery of threatened and endangered species), dispute resolution provisions, suspensions and terminations, and nally, operations and maintenance. is digest updates earlier digests and other litera- ture on risk management strategies. is digest will be helpful to all involved in the development, construction, and management of mega projects, including engineers, insurance providers, attorneys, state and federal person- nel, consultants, contractors, and students. Managing Enhanced Risk in the Mega Project Era This digest was prepared under NCHRP Project 20-06, “Legal Problems Arising Out of Highway Programs,” for which the Transportation Research Board (TRB) is the agency coordinating the research. Under Topic 25-03, Ghada M. Gad, Hajer Dawoody, and Omar Shabana, California State Polytechnic University, Pomona, CA; Christine Ryan and Patricia M. de la Peña, Nossaman LLP, Austin, Texas; Edmund Caplicki, Nossaman LLP, Los Angeles, CA; and Edward Minchin, Celia Planeta, and Wren Weber, University of Florida, Gainesville, FL, prepared this digest. The opinions and conclusions expressed or implied in this digest are those of the researchers who performed the research and are not necessarily those of the Transportation Research Board; the National Academies of Sciences, Engineering, and Medicine; or the program sponsors. The responsible program officer is Gwen Chisholm Smith. AUGUST 2022 NATIONAL COOPERATIVE HIGHWAY RESEARCH PROGRAM NCHRPLRD 86 LEGAL RESEARCH DIGEST A01207--NCHRP LRD 86 cover aug17.indd 1 8/17/22 7:35 PM