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Value Engineering Final Rule
The Value Engineering Final Rule (pdf) was published on September 5, 2014. (Docket No. FHWA-2013-0039).
This Final Rule modifies Federal regulation, Title 23 Code of Federal Regulation (CFR) part 627, to reflect the revisions made in Federal law (Section 1503(a)(3) of Moving Ahead for Progress in the 21st Century Act, MAP-21). The changes to the regulation are:
Value Engineering (VE) is defined as a systematic process of review and analysis of a project, during the concept and design phases, by a multidiscipline team of persons not involved in the project, that is conducted to provide recommendations for:
The successful application of the VE process can contribute measurable benefits to the quality of the surface transportation improvement projects and to the effective delivery of the overall Federal-Aid Highway Program.
This web site describes the FHWA's VE program; discusses many subjects crucial to the administration of a successful VE program; and attests to the program's benefits through the compilation of annual accomplishment reports and descriptions of successful practices and VE analyses. The web site also addresses a series of Frequently Asked Questions on VE and the Federal VE requirements.
Background. The FHWA's VE program applies to the Federal-aid program under which the funds authorized in Federal-aid highway acts are distributed to States for projects developed and administered by State Departments of Transportation (DOT). This program is designed to:
History of VE in the Federal-aid Program. VE has long been applied both within the Federal Government and in the transportation industry. The Federal-aid Act of 1970 required VE and cost reduction analyses on Federal-aid projects. The Office of Management and Budget (OMB) Circular A-131 http://www.whitehouse.gov/omb/circulars/a131/a131.html, issued in May 1993, required all Federal agencies to use VE and report on VE practices on an annual basis.
In late 1995, Congress passed the National Highway System (NHS) Designation Act which included a provision requiring the Secretary to establish a program that would require States to carry out a VE analysis for all Federal-aid highway funded projects with an estimated total cost of $25 million or more. On February 14, 1997, the FHWA published its VE regulation in part 627 of title 23 of the Code of Federal Regulations (23 CFR 627) that formally established the program.
After the FHWA published the final rule establishing regulations for the design-build project delivery method in December 2002, the VE regulations in 23 CFR 627 were amended accordingly to require VE on qualifying design-build projects.
In 2005, the language contained in Section 1904 of the SAFETEA-LU authorizing legislation brought further changes. In addition to the requirements previously established for projects requiring studies (which now reference the Federal-aid System), VE studies were additionally required for:
In 2012, VE requirements were further changed under the Moving Ahead for Progress in the 21st Century (MAP-21) act. The following outlines the major VE requirements under MAP-21 which became effective for any new construction contract authorized after October 1, 2012.
FHWA Divisions may require additional VE analysis beyond the Federally required minimum thresholds if they determine the project may benefit from a VE analysis.
On August 28, 2013, the FHWA updated its VE Policy to:
Incorporate the provisions made in MAP-21 (Moving Ahead for Progress in the 21st Century). See the above VE Notice of Proposed Rule Making for specific MAP-21 changes.
This Policy also incorporates the following program improvements.
Savings Achieved with VE. The FHWA annually collects information on VE accomplishments achieved within the Federal-aid and Federal Lands Highway Programs. The following table summarizes recent savings realized by conducting VE. Additional details are available by reviewing the complete versions of the FHWA VE Summary Reports.
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