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Federal Highway Administration > Publications > Focus > March 2008 > New Training on Cost Estimating for Today's Highway Projects
March 2008Publication Number: FHWA-HRT-08-011

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New Training on Cost Estimating for Today's Highway Projects

“Addressing Uncertainty in Cost Estimating” is the goal of a new 2-day course being introduced by the Federal Highway Administration’s (FHWA) National Highway Institute (NHI). The course provides participants with an overview of current cost estimating practices for highway projects, including consideration of risk and uncertainty in project cost estimates, and an appreciation of the importance of cost estimating. It will compare and contrast deterministic (single number) and probabilistic (range of numbers) methods of cost estimating, including looking at which method is most appropriate to use during the various phases of project development. “Upon completion of the course, participants will be able to select the most appropriate methodology based upon the project’s characteristics and phase of development,” says Jim Sinnette of FHWA. While the course specifically addresses cost estimating for large and complex projects, the concepts presented are applicable to developing estimates for all types of transportation projects.

Two pilot courses were held in partnership with the Virginia Department of Transportation (VDOT) in Richmond, Virginia, in July 2007 and the California Department of Transportation (Caltrans) in Los Angeles, California, in October 2007. During the pilot courses, participants gained hands-on experience through the use of case studies and various exercises targeted toward understanding how to account for risk and uncertainty in an estimate. “Going through the exercises and looking at historical data and applying it to what we’re currently trying to accomplish was a truly effective part of the course,” says John Rieger, Project Manager at Caltrans.

Other pilot course participants noted the course’s value in applying theories to real-life transportation projects and explaining the fundamentals of cost estimating, as well as using pertinent anecdotes to illustrate concepts and exercises.

The course provides participants with an overview of current cost estimating practices for highway projects, including consideration of risk and uncertainty in project cost estimates, and an appreciation of the importance of cost estimating.

Course participants will gain the skills to assist more experienced estimators at various stages of the cost estimating process, including the ability to explain the principles of probabilistic estimating, decide when it is appropriate to use a deterministic or probabilistic approach or a combination of methods, quantify the likelihood of occurrence and consequences of risk events, and determine how the results from a risk-based estimate can be applied to project development. Participants will also learn how to analyze and evaluate the process of creating a cost estimate to determine if it is consistent with the FHWA Major Project Guidance and report cost and schedule estimates accurately and comprehensively to stakeholders.

The course is available to Federal and State transportation department personnel, local Government staff, metropolitan planning organizations, design consultants, and engineers and planners. Participants’ job responsibilities should include preparing, analyzing, or approving cost and schedule estimates; conducting preconstruction or early cost estimating that will be carried through the life of the project; and identifying risks or obstacles that could trigger a cost increase or delay in a project.

Figure 9. Photo. A view of a four-lane highway. Traffic is traveling in both directions on the highway.
The new NHI course applies theories to real-life transportation projects and explains the fundamentals of cost estimating.

The course fee is $270 per person, with a minimum of 20 participants and a maximum of 30. For more information on “Addressing Uncertainty in Cost Estimating” (Course No. FHWA-NHI-134068), contact Jim Sinnette at FHWA, 202-366-0479 (email: james.sinnette@fhwa.dot.gov). The course will be available for scheduling through NHI’s Web site (www.nhi.fhwa.dot.gov) starting this spring. The FHWA Major Project Guidance is available online at www.fhwa.dot.gov/programadmin/mega/mpguide.cfm.

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Updated: 04/07/2011

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