A Synthesis of Highway Practice

A Synthesi

s of Highway Practice

Preliminary Results Presentation

Value EngineeringApplications in Transportation

David C. Wilson, P.Eng., CVS2004 Government VM Conference Montreal, QC

This Presentation…This Presentation…

Five Aspects:

• VE in Transportation – History Lesson

• Study Objectives

• Survey Approach and Literature Review

• Key Observations • Future Directions and Needs

History LessonHistory Lesson

1940’s – VE development in manufacturing1950’s – US Government (Bureau of Ships)1960’s – Incentives in construction contracts1970’s

– 1970, Federal-aid Highway Act required VE– 1973, FHWA appointed VE Coordinator; encourages VE

– 1975, FHWA/NHI VE training program initiated

1980’s – AASHTO recognizes VE; Guidelines

History LessonHistory Lesson

1990’s– 1991, ISTEA permitted FHWA to revisit VE

requirement (encourage vs. require)– 1993, OMB Circular A-131 VE requirement– 1995, National Highway Designation Act

$25M threshold on federal-aid NHS projects

– 1997, FHWA Regulation 23 CFR Part 627 response– 1999, AASHTO Guidelines revised

2000’s– 2002, Final ruling on D/B VE requirements

History LessonHistory Lesson

NCHRP 78 (1981)– VE primarily on standards and specifications– Few DOT’s active at the time– DOT VE Pioneers

California – 1969 Idaho and Virginia – 1973 Minnesota – 1975Florida – 1976 New Mexico – 1977 Oregon and Pennsylvania - 1979

NCHRP 35-04 Study Objectives/ApproachNCHRP 35-04 Study Objectives/Approach

Summarize current practices/programsFocus

– Policies, guidelines, project selection– Education and awareness– Applications– Implementation– Monitoring– Future Needs

Approach– Extensive DOT survey– Literature Review

SurveySurvey

46 question survey developedDistribution

– NCHRP sent survey to 52 DOTs in United States– TAC sent survey to Canadian DOTs and Cities– Toll Authorities not included– Federal Lands recently received survey

Response– 37 US DOTs; 4 Canadian DOT’s– 3 Cities (New York; Ottawa; Winnipeg)

SurveySurvey

Did not respondto survey

Note: Puerto Rico did not respond (not shown)

US DOT Responses Still Required

The Top Ten – 5 Year SummaryThe Top Ten – 5 Year Summary

> 200 Studies

100 - 200 Studies

< 100 Studies

Source: FHWA

Literature ReviewLiterature Review

Scope– North America

Primary Sources– AASHTO– FHWA– Miles Foundation– Conference Proceedings– Journals– Universities

Key ObservationsKey Observations

Developing policy and guidelines– FHWA VE Regulation serves as basis in US– No common federal requirement in Canada– Selected DOTs

Developed specific guidelines Developed manuals

– Separate manuals

– Chapters within Design Manuals

Key ObservationsKey Observations

Selecting Projects– Generally US DOTs use $25M threshold– Some variation examples

Nevada - $10M (if policy enacted) Pennsylvania, Ohio - $20M New Hampshire - $50M Virginia, Alaska, Ontario - $10M

– Rarely on small projects– Build stakeholders consensus– Validate project scope or resolve issues– “Because we have to!”

Key ObservationsKey Observations

Comparative benchmarks– 1981 (NCHRP Synthesis 78)

Primarily on standards and specifications Rarely projects

– 2004 (NCHRP Synthesis - New) Rarely standards and specifications Primarily on projects

Key ObservationsKey Observations

Team Leaders– Majority require CVS as Team Leader– AVS and VMP generally not permitted– Most require a PE as a leader

Job Plans– Generally similar to SAVE Job Plan– Variations generally expand basic steps

Caltrans has 13 step job plan

Key ObservationsKey Observations

Education and Awareness– Training

FHWA/NHI; Consultants; SAVE Conference

– 70% of DOTs do not have a formal program– 19 DOT’s with training programs in place (5-10 yrs)

California – 1,200 staff Virginia – 2,300 (1,500 still with VDOT) Washington, New Jersey, Ontario – 350 each Michigan, North Carolina, Arizona - < 20 each

– Budget constraints have impacted training

Key ObservationsKey Observations

VE Related Tools– Most Popular

Cost models FAST diagrams Evaluation matrices

– Emerging Project Performance Measures Risk registers Cause-Effect (Wishbone diagram) Choosing By Advantages (long term opportunity)

Key ObservationsKey Observations

Study Duration– Typically 3-5 days; sometimes split workshops– DOT Motivation

Staff availability VE study costs

– Pressures on VE Team Selecting ideas Evaluating ideas

– Results/quality may be affected if not enough time allocated to workshop

Key ObservationsKey Observations

Evaluating/Shortlisting Ideas - Criteria– Project cost– Constructability– Road safety– Traffic staging– Schedule impacts

Right-of-way Environmental

Key ObservationsKey Observations

Emerging Evaluation Approaches– User delay

During construction Post-construction

– Road safety Explicit consideration of crash costs Human factors reviews

Reaching consensus– 60% of DOTs use open discussions to reach

agreement

Key ObservationsKey Observations

Acceptance of VE Proposals– ± 60% of DOTs have form of implementation

strategy or meeting in place Michigan, Ontario, California have meetings

New York permits Regional Offices to decide on VE proposals

– VE Organization Reporting Relationship Primarily part of Design Branch Some report to Financial Branch

– New York City

– Virginia

Monitoring VE Performance– FHWA reporting requirements typically govern

Focused on ROI– Construction costs

– Study costs

– Savings (design or construction – VECP)

– Performance Improvement California Florida Virginia New Mexico Washington

Key ObservationsKey Observations

Key ObservationsKey Observations$8

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$2,0

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1000

2000

3000

4000

5000

6000

7000

8000

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CALIFORNIA FLORIDA VIRGINIA NEW YORK MICHIGAN WISCONSIN MARYLAND TEXAS NEW JERSEY COLORADO

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Source: FHWA

FHWA Program ReportTop 10 States – VE Expenditures

Key ObservationsKey Observations

Value Engineering Performace Measures 2001-2003

0%10%20%30%40%50%60%70%80%

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FY 2001FY 2002FY 2003

FY 01 Net project Savings $57.2 millionFY 02 Net Project Savings $71.0 millionFY 03 Net Project Savings $41.3 million

Source: WSDOT

Threats and OpportunitiesThreats and Opportunities

Education– Refresh knowledgeable workforce

DOT staff attrition or promotion Consultant demographics

– SAVE Module I and II Training courses need to evolve Permit more diverse VE-related tools

– NHI Courses Maintain access to DOTs

Project Scope and Selection– Opportunities to expand VE

Smaller projects (lower thresholds) Non-NHS federal-aid projects (non-mandated) Standards and specifications

Measuring Performance– Consider project performance improvement

Project performance measures Tracking database (racing forms)

Threats and OpportunitiesThreats and Opportunities

Threats and OpportunitiesThreats and Opportunities

Stakeholder Involvement– Value planning– Value-based design charettes

VE Acceptance– Defining implementation process

Detailed responses Due Diligence

– Declaring a “Champion” Managing the VE proposals Managing the decision-making system

Research Needs/ChallengesResearch Needs/Challenges

Key Challenges– How can we improve the readiness of the VE

community?– How can safety, risk, user delay and other user

costs be effectively considered? – What is the most appropriate method to measure

project performance?– What role will emerging evaluation techniques

play in future decision-making?– How can links be forged with other assessment

tools?

Summary…Summary…

Five Aspects:

• VE in Transportation – History Lesson

• Study Objectives

• Survey Approach and Literature Review

• Key Observations • Future Directions and Needs

A Synthesi

s of Highway Practice

Preliminary Results Presentation

Value EngineeringApplications in Transportation

David C. Wilson, P.Eng., CVS2004 Government VM Conference Montreal, QC

ContactContact

David C. Wilson, P.Eng., CVSVice PresidentNCE Limited

2800 Fourteenth Avenue, Suite 206Markham, ON, L3R 0E4T (905) 943-4443F (905) 943-4449

david.wilson@nceltd.com