Value Engineering Study and Risk Assessment

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Value Engineering Study and Risk Assessment
Highway 7 New - Kitchener to Guelph
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Presentation Outline

• Project Background
• Value Engineering and Cost Risk Analysis
• Study Outcomes

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Key Plan
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Highway 7 Background

• Highway 7 is a congested 2-lane
• highway (AADT 21,000 - 32,000)
• Planning study commenced in 1989
• Individual EA submitted in 1997
• EA resubmitted in 2002
• Individual EA approval obtained in March 2007 for
  an 18 km long, 4-lane freeway, following a new
  alignment generally north of and parallel to
  existing Highway 7

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Value Engineering Study

• Largest single VE study ever undertaken by MTO
• VE Team jointly lead by Marshall Macklin Monaghan
  (MMM Group) and iTrans
• Additional members from FaithfulGould, MACTEC,
  Davis-Langdon, WCS, Thurber, Human Factors North,
  HCi, and MTO
• Site visit and information meeting was held April
  2007
• Safety Audit of base case undertaken pre-study.
• Value Engineering Study completed in Kitchener
  April 30 to May 4, 2007.
• VE Team presentation to MTO Senior Management
  held May 15, 2007.
• Focused 5 days on workshop. Split pre/post
  activities as concerned over maximizing time for
  workshop.

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VE Scope

• The EA approved alignment was assessed
• The Study Team generated 212 ideas (of which 56
  were developed) in eight Target Areas and
  evaluated using seven Performance Measures

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Value Target Areas

• Team identified 8 Target Areas
• Kitchener-Waterloo Freeway to Freeway Interchange
• Grand River Bridge and Bridge Street
• Regional Road 17 Interchange
• Regional Road 30 Interchange
• County Road 86 Interchange
• Highway 6 Interchange
• Sideroads
• Mainline

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Performance Measures

• Team Developed 7 Performance Measures
• Weight
• Safety (collisions) 22
• Human Factors (predictability, signs, geometry)
  17
• Traffic Operations (v/c, weaving, queuing) 19
• Access (interchange access, local road across)
  13
• Sustainability (environmental, growth) 12
• Constructability (staging complexity, resources,
  access) 8
• Maintainability (structures, roadway
  cross-section) 8

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VE Ideas
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VE Scenarios

• Of the 56 ideas evaluated in detail, 29 were
  developed into VE alternatives.
• The VE Team grouped these alternatives into 5
  Scenarios based on function or impact.
• Scenario 1 - Minimal Improvements
• Scenario 2 - Minimal Improvements with various
  interchanges deferred
• Scenario 3 - Moderate Improvements with
  Roundabouts
• Scenario 4 - Moderate Improvements
• Scenario 5 - Reduced Expenditure / Constrained
  Funding

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VE Conclusions

• Scenarios 1-5 had performance benefits over the
  base case.
• 29 VE Proposals were used to develop numerous
  other scenarios.
• 30 VE Design Suggestions were generated for
  consideration during preliminary and detail
  design.

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Implementation Plan

• VE team developed 29 individual alternatives and
  packaged them into an Implementation Plan to
  Senior Management.
• Implementation of some alternatives are
  considered a substantive change to the approved
  EA.
• It will be necessary to prepare an addendum to
  the TESR to document the changes and obtain
  environmental approval from MOE.
• The alternatives from the VE Study that were
  recommended for implementation are currently
  being evaluated for performance and cost
  benefits.

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Risk Assessment

• No construction project is risk free. Risk can
  be managed, minimized, shared, transferred, or
  simply accepted, but it can not be ignored.
• C.R.I. Clayton, 2001. Managing Risk

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Cost Risk Analysis

• Objectives
• Review MTO concept base construction estimate
• Incorporate latest property estimate
• Review schedule
• Identify constraints to schedule
• Quantify risks as to likelihood of occurrence and
  impact in terms of and extended project
  duration
• Discuss possible mitigation reduce, avoid and /
  or transfer risks

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Process

• Risk identification (completed concurrently with
  the VE Study)
• Pre workshop Top Risk questionnaire issued to
  VE team
• Risk analyst compiled draft risk register
• Risk analyst built schedule and cost model base
  case working with VE / MTO team
• Risk analyst identified constraints to schedule
  with VE team
• Draft risk register circulated to VE team for
  confirmation / comments on risks identified
  risk register updated
• Production of risk analysis, summary and report

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Cost Risk Analysis

• Greatest Risks to Projects Cost and Schedule
• Grand River Bridge Issues
• Material price volatility
• Market forces/number of bidders
• Escalation
• Environmental Mitigation
• Relocation of Utilities
• Variability in earthwork quantities
• Complex KWE structures

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Project Schedule Constraints

• Key Project Constraints identified as
• In-water timing restrictions
• Bird nesting season impacts tree clearance in
  wetlands
• Winter work impacts paving and influences
  structure and earthworks construction
• Wetlands clearance requires special protective
  measures and consultation
• River crossings requires detailed consultation
  with First Nations
• Funding Availability impacts phasing of project
  
• Minimizing traffic impact during construction
• Reducing Rail impact CN under-bridge
  construction

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Top Risks from Risk Register
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Top Risks from Risk Register
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Study Outcomes - Where are we now?

• Implementation Plan endorsed by MTO Sr. Mgmt.
• 2 engineering assignments currently underway.
• MMM Group developing VE recommendations within a
  Preliminary Design/Detail Design assignment.
• Thurber Engineering undertaking a Foundation and
  Pavement Field investigation.
• Property Request to be available in early 2009.

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Study Benefits

• New perspective on study
• New PM had no ownership
• Risk analysis (cost/schedule)