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Design-Build E ffectiveness Study

As Required by TEA-21 Section 1307(f)
Final Report
Prepared for:
USDOT - Federal Highway Administration
January 2006

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This chapter summarizes the lessons learned by survey respondents and changes planned for their agencies' design-build programs. The chapter also presents the conclusions of the research team regarding the prospective use of design-build project delivery and the team's recommendations for improving the use of design-build contracting in the nation's highway development program.


In responding to the study surveys, the design-build project managers shared their thoughts regarding lessons learned during the SEP-14 program. The research team also received numerous comments and suggestions regarding changes the surveyed agencies have made in their design-build programs and suggestions to further improve these programs, based in part on these lessons learned. This section summarizes the comments and suggestions for improvement.

Design-Build Program Lessons Learned Based on Project Surveys

The project managers who completed design-build project surveys noted many lessons learned from these projects. Key lessons included:

The full digest of "lessons learned" comments is provided in Exhibit V.1.

Design-Build Program Improvements Based on Program Surveys

Design-build project managers responding to the surveys reported having undertaken or proposed several major changes to improve the effectiveness of their agencies' design-build programs. Changes included amending quality assurance and quality control, better defining program guidelines, and working more closely with design and construction contractors to craft a better program. Several agencies reported that their design-build program was reassessed on an ongoing basis as projects moved through the process. Florida DOT's response was typical:

Actual changes that have already been undertaken as reported in the program surveys are summarized in Exhibit V.2, and those that are proposed are summarized in Exhibit V.3.

Exhibit V.1: Summary of Lessons Learned from Design-Build Projects

GuidelinesCooperation with Industry
  • Performance criteria in lieu of prescribed specifications is key to efficiency of the designbuild process
  • Project criteria should state project goals
  • Process works best with experienced contractors and designers
  • Contracting community requires education on conceptual estimating practices, especially the subcontracting community
Project SelectionProject Phasing
  • It is relatively simple to use design-build to replace existing similar construction
  • May not be well-suited for small projects such as small bridges
  • May be better suited for roadway construction rather than ITS projects
  • Ideal method for road widening under traffic
  • Right-of-way acquisition required prior to letting design-build contract
  • Permitting and geotechnical borings prior to letting place contractors at ease and facilitate process
Project ManagementPreliminary Engineering
  • Co-locating project team for the entire duration of project facilitates coordination
  • Establish and maintain open communications channels, including regular progress meetings
  • Establish expectations of all parties prior to beginning work
  • Facilitate cooperative working relationship between contracting agency and design-build team
  • Recognize criticality of schedule
  • Provide efficient management structure
  • Establish meaningful incentives and penalties
  • Development of original documents may have stifled contractor creativity and innovation
  • Carefully consider the appropriate level of design to complete prior to letting contract
  • Over-prescribing design details or construction techniques may stifle potential innovation
  • Focus technical scoring of proposals on areas that the agency values
Third-PartiesOwner Participation
  • Effort and time to tie down third party (railroads, utilities, local agencies) commitments prior to project award is essential
  • There is major effort required of the project contracting agency, so design-build should be used only when it provides the most effective delivery means
  • Successful management of designbuild may require a new approach to project administration by the contracting agency
Contract Language and DefinitionsChange Orders
  • To ensure the contracting agency receives the expected product within budget, clear and concise performance specifications are essential to the success of a design-build contract
  • Establish funding responsibility for any unforeseen changes required in project design and construction
Risk AllocationProcurement
  • Allocate risks where they are best managed
  • Design-build is not well suited to lowbid selection method

Source: D-B project survey: Q18, 49 responses

Exhibit V.2: Summary of Actual Design-Build Program Changes

Quality Assurance/Quality ControlCooperation with Industry
  • Better define quality control and who provides it. Third-party contracting of quality assurance
  • Change in QA/QC responsibility, with contracting agency responsible for quality assurance and contractor responsible for quality control, in lieu of previous arrangement in which contractor had responsibility for QA and QC and contracting agency had discretionary sampling and testing privileges
  • Agency periodically conducts design-build workshops with industry partners, contractors and designers to refine delivery processes. Recent successes include continuity of agency selection team, debriefing process, agreement to include alternate technical concept, and one-on-one communication process during RFP stage.
Project SelectionProcurement Regulations
  • Streamlining selection process
  • Changed state statutes to permit bestvalue approach
  • Achieved regulatory authority to implement design-build
Preliminary EngineeringStipends
  • Reduce level of preliminary engineering and transfer this work to design-build contractors
  • Use of stipends to offset cost of preliminary design for unsuccessful proposers
Environmental MonitoringUtilities
  • Placement of environmental monitors (agents of the state) on environmentally sensitive projects to ensure compliance with permit requirements of the contractor
  • Incorporation of utilities design and construction into contract documents, making it a requirement of the designbuild team
Contract Language and DefinitionsBaseline Information
  • Standardized contract language for design-build procurement, including general and project-specific requirements
  • Refinements of project scope definitions and standard specifications
  • Providing upfront information such as soils, geotechnical, permit, and right-of-way information
  • Standardization of plan package content based on 30 percent plan details, including line, grade, and typical section for roadway and/or type, size, and location for structures
Risk Allocation 
  • DOT works closely with AGC and ACEC to develop more focused risk allocation, used by agency to develop initial plans as well as proposal

Source: D-B program survey: Q24, 27 responses

Exhibit V.3: Summary of Proposed Design-Build Program Changes

Quality Assurance/Quality ControlCooperation with Industry
  • Continued refinement of QA/QC plan
  • Re-establishing partnership efforts with DOT, FHWA, contractors, and consulting engineers
Project SelectionProcurement Regulations
  • Improved guidance for when to utilize innovative contracting methods
  • Incorporate more structures into program, and evaluate use of designbuild on mega-projects, smaller projects, and bridge and ITS projects
  • Considering deleting the Federal statutory definition of a "qualified project" so that SEP-14 will no longer be necessary for design-build projects that comply with FHWA's regulation.
Project ManagementStipends
  • Bring construction engineering management in-house
  • Development of a formal process for stipend determination
Contract Language and DefinitionsRisk Allocation
  • Clarifying third-party and quality assurance requirements
  • Refinement of contract language based on feedback from the contracting industry, consultants, FHWA, and DOT personnel
  • Revise program documents to make easier to use
  • Continued refinement of contract template
  • Move all responsibility for project decisions, quality control, engineering, and inspection to the contractor, who would hold a comprehensive warranty to cover workmanship repairs and defects. Contractor would be held accountable for the entire project (i.e. no shared responsibilities). Difficult to accomplish within the culture of the transportation and insurance industries

Source: D-B program survey: Q25, 25 responses

Among project survey respondents, 33 percent reported that their projects could have been more successful with what they know now about the design-build process. Suggestions for further improving the design-build process included:


Based upon the results of this study, the following conclusions are offered regarding the future disposition of design-build as an alternative method for delivering highway projects, relative to the areas of interest defined by Section 1307 (f) of TEA-21, which mandated this study:

Impacts on Project Timeliness

Impacts on Project Cost

Impacts on Project Quality

Level of Design Completed Prior to Design-Build Contract

Impacts on Small Business

Subjectivity of Design-Build Contracting

Other Considerations


Based upon the results of this study, the following recommendations are offered to improve the use of design-build for delivering highway projects.


The changing nature of the nation's highway infrastructure development program and resources, at the federal, state, and local levels, is placing increasing burdens on the public sector's ability to meet the growing needs for renewed and expanded system capacity. Innovative techniques like design-build have been shown to offer significant potential to help transportation agencies better serve these needs by doing things faster and more cost-effectively. While many of the conditions that spawned the promulgation of highly restrictive contracting laws and procedures early in the twentieth century are no longer in evidence, care must be taken to prevent a repeat of these conditions. This is why the use of techniques like design-build contracting must be viewed and entered into with the understanding that the public and private participants in the process have a shared interest and liability for the results of the process, and are each held accountable for the results.

Design-build contracting represents a collaborative effort that integrates the various resources involved in the development of a highway project and provides incentives for a high level of technical performance and consistency with contractual budget and schedule terms. It has the potential to produce a more cost-effective project in less time than a process that contractually insulates the project participants while leaving the contracting agency with most of the project risk. The following quotes reflect the views of many of the respondents to the design-build surveys:


  1. 23 CFR part 636

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