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Accelerating Innovation

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Economic Analysis

A key aspect of HfL demonstration projects is quantifying, as much as possible, the value of the innovations deployed. This entails comparing the benefits and costs associated with the innovative project delivery approach adopted on an HfL project with those from a more traditional delivery approach on a project of similar size and scope. The latter type of project is referred to as a baseline case and is an important component of the economic analysis.

Construction Time

ADOT believes that overlapping design and construction and using alternate project delivery, incentive/disincentive contract clauses, and innovative accelerated construction technologies enabled it to dramatically reduce the duration and impact of construction activities on residents, businesses, and roadway users. Although it took several months to complete the construction of the substructure and superstructure for the pedestrian overpass and the new Oak Creek Bridge, the as-built construction impact on users was minimal.

Construction Costs

Table 4 presents the summary of the planned and actual costs for the as-built alternative. Table 5 provides the detailed breakdown of the actual costs. As noted in table 4, the as-built construction cost was about four times the budgeted cost of the project.

Assuming that the baseline alternative is to construct a standard, four-lane divided highway, a reasonable comparison of cost estimates for the as-built and baseline alternatives could not be made. The as-built alternative took longer to develop through the NBIP process, incurred higher construction costs, and provided more challenges in phasing construction, while the baseline case could have been cheaper. However, intangible benefits were realized through project development with the NBIP process with a higher quality project that fits within the context of the community and environment.

Table 4. Original versus current budget.
Original Budget $14,680,000.00
Current Budget $54,989,036.35
Total Charges $53,875,389.22

Table 5. Detailed breakdown of the actual projects.
Contractor Pay $44,262,350.62
Other Construction $225,300.21
Public Relations $11,545.43
Direct Construction Engineering $1,549,771.63
Other Construction Engineering $758,865.96
Construction Administration $0.00
Rent-A-Tech $4,094,368.23
Total Construction Estimate $6,403,005.83
Postdesign $2,609,720.30
Department of Public Safety $350,347.36
Joint Project Agreements $13,119.47
Utilities $0.00

User Costs

Several major innovations were implemented in this project to mitigate the construction impacts and improve mobility and safety during construction. The major innovations included roundabout phasing, increased use of law enforcement, use of prefabricated bridge elements, use of a lane rental contract provision, and enhanced public outreach.

As noted earlier, the crash frequencies during construction were generally lower than the preconstruction frequencies. Considering that the same number of lanes that existed before construction was maintained during construction, no major impacts were observed except for some delays observed at the north end of the project. Also, the observed work zone speeds ranged between 13 and 30 mi/h.

Because construction costs of the as-built and the baseline scenarios were not compared, user costs also were not computed. Furthermore, the intangible road user and community benefits realized with the NBIP process cannot be readily monetized with available methods.

Page last modified on July 12, 2013.
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Federal Highway Administration | 1200 New Jersey Avenue, SE | Washington, DC 20590 | 202-366-4000