NCHRP 35-04 Preliminary Results Pres 06-04

1
A Synthesis of Highway Practice
Value Engineering Applications in Transportation
Preliminary Results Presentation
2
This Presentation

• Five Aspects

• VE in Transportation History Lesson

• Study Objectives

• Survey Approach and Literature Review

• Key Observations

• Future Directions and Needs

3
History Lesson

• 1940s VE development in manufacturing
• 1950s US Government (Bureau of Ships)
• 1960s Incentives in construction contracts
• 1970s
• 1970, Federal-aid Highway Act required VE
• 1973, FHWA appointed VE Coordinator encourages
  VE
• 1975, FHWA/NHI VE training program initiated
• 1980s AASHTO recognizes VE Guidelines

4
History Lesson

• 1990s
• 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
• 2000s
• 2002, Final ruling on D/B VE requirements

5
History Lesson

• NCHRP 78 (1981)
• VE primarily on standards and specifications
• Few DOTs active at the time
• DOT VE Pioneers
• California 1969
• Idaho and Virginia 1973
• Minnesota 1975
• Florida 1976
• New Mexico 1977
• Oregon and Pennsylvania - 1979

6
NCHRP 35-04 Study Objectives/Approach

• Summarize current practices/programs
• Focus
• Policies, guidelines, project selection
• Education and awareness
• Applications
• Implementation
• Monitoring
• Future Needs
• Approach
• Extensive DOT survey
• Literature Review

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Survey

• 46 question survey developed
• Distribution
• 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 DOTs
• 3 Cities (New York Ottawa Winnipeg)

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Survey
US DOT Responses Still Required
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The Top Ten 5 Year Summary
Source FHWA
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Literature Review

• Scope
• North America
• Primary Sources
• AASHTO
• FHWA
• Miles Foundation
• Conference Proceedings
• Journals
• Universities

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Key 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

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Key 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!

13
Key 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

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Key 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

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Key Observations

• Education and Awareness
• Training
• FHWA/NHI Consultants SAVE Conference
• 70 of DOTs do not have a formal program
• 19 DOTs 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 - lt 20 each
• Budget constraints have impacted training

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Key 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)

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Key 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

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Key Observations

• Evaluating/Shortlisting Ideas - Criteria
• Project cost
• Constructability
• Road safety
• Traffic staging
• Schedule impacts
• Right-of-way
• Environmental

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Key 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

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Key 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

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Key Observations

• 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

22
Key Observations
FHWA Program Report Top 10 States VE
Expenditures
Source FHWA
23
Key Observations
Source WSDOT
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Threats 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

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Threats and Opportunities

• 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)

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Threats 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

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Research 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?

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Summary

• Five Aspects

• VE in Transportation History Lesson

• Study Objectives

• Survey Approach and Literature Review

• Key Observations

• Future Directions and Needs

29
A Synthesis of Highway Practice
Value Engineering Applications in Transportation
Preliminary Results Presentation
30
Contact
David C. Wilson, P.Eng., CVS Vice President NCE
Limited 2800 Fourteenth Avenue, Suite
206 Markham, ON, L3R 0E4 T [phone] F (905)
943-4449 david.wilson_at_nceltd.com