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Major Projects


Summary of Lessons Learned from Recent Major Projects

FHWA now has the benefit of having gone through several Major projects in which "lessons learned" can be drawn. Construction of the Central Artery/Tunnel (CA/T) project in Boston, Massachusetts is now over 75% complete, and is often referred to as "the largest public works project in American history." The Woodrow Wilson Bridge (WWB) project in Maryland/Virginia/District of Columbia began construction in October 2000, and underwent extensive coordination and a rigorous review of the Initial Financial Plan and Ownership Agreement. The I-15 reconstruction project in Salt Lake City, Utah was a huge success in being completed well ahead of schedule for the 2002 Winter Olympic Games. Many other FHWA Major projects are ongoing throughout the country.

Because the CA/T project was by far the largest Major project overseen by FHWA, with just about every type of major civil/structural construction included, it will be the focus of this chapter. In the future, this chapter will be revised to include lessons learned from other Major projects. The CA/T is being constructed by the Massachusetts Turnpike Authority (MTA) as part of their responsibility for the Metropolitan Highway System in Boston and is making use of some of the world's most advanced technologies and innovations. While the project has had many success stories, it has also been the subject of controversies. When initially approved in 1985, the project was estimated to cost $2.6 billion. When the first construction project was authorized in 1991, the total cost of the project was estimated to be $5.8 billion. The project costs have risen through the years to the current estimate of over $14.5 billion. Federal funds for the project have now been capped at $8.549 billion. The major reasons for the cost increases were scope of work changes, an array of unanticipated underground conditions (poor soils, utilities, other old structures and obstructions), underestimated complexity of design and construction, unanticipated third-party costs, and not properly taking inflation into account. In addition, there have been issues with the funding of the Owner Controlled Insurance Program (OCIP), the project cost and schedule tracking and reporting, and other project management issues.

FHWA has a long history of relying on the Federal/State "partnership" in carrying out its oversight role, due to the unique Federal-aid highway program in which the States are responsible for managing and developing their own projects, subject to Federal oversight. Probably the biggest lesson learned from the CA/T project is for the need for FHWA personnel to maintain an independent enough relationship with the State in order to adequately fulfill the oversight role. The need to independently review and verify the State's management, administration, and delivery of the project is paramount to protecting the Federal investment in the project and in ensuring that Federal funds are used properly and efficiently. This project, along with other projects such as FTA's Seattle Central Link light rail project, reinforce the need to ensure that the project sponsors have a reasonable and credible plan to finance the project at the start of construction. Major projects can no longer be financed on the "pay-as-you-go" basis.

Federal Task Force on the CA/T Project

The Secretary of Transportation and the Federal Highway Administrator commissioned a Federal Task Force in early 2000. The Federal Task Force on the Boston Central Artery/Tunnel Project report was issued on March 31, 2000, and can be accessed at https://www.fhwa.dot.gov/reports/tunnel.htm. The Task Force was charged with assessing the circumstances that lead to a recently announced $1.4 billion potential cost increase, evaluating the effectiveness of the Financial Plan for addressing such costs, and reviewing the overall management and oversight processes. The report ultimately made thirty-four (34) recommendations (see Insert VIIA). A summary of the recommendations are as follows:

  • Project Leadership. Changes to key MTA and FHWA leadership positions were made.
  • Financial Plan. Seventeen (17) of the thirty-four (34) recommendations dealt with items concerning the preparation of the Financial Plan. These items included establishing a national policy on the preparation and review of Financial Plans for major projects; providing an independent cost estimate of the project by FHWA on an annual basis; providing an independent certification of the Financial Plan information by another state agency; and including contingency plans to cover potential revenue shortfalls or cost overruns. The Financial Plan Guidance for major projects was issued by FHWA on May 23, 2000, and incorporated these recommendations.
  • Balanced Statewide Program. The Task Force recommended that the Massachusetts Highway Department (MHD) reach agreement with local officials to obtain a balanced statewide program. The need for funding equity between the CA/T project and the Statewide road and bridge program was therefore addressed through a Memorandum of Understanding (MOU), executed between MHD and twelve of its thirteen Metropolitan Planning Organizations. The MOU established the types of construction and related transportation activities that will count toward the $400 million Statewide road and bridge program expenditure target.
  • Oversight. Several of the recommendations addressed the need for more open communications, availability of information to oversight agencies and the public, a stronger role by FHWA and the State in independent analyses of cost, and monitoring the factors affecting cost. As a result of these recommendations, the CA/T changed their Project Management Monthly (PMM) Report and Quarterly Report formats to include more cost and schedule information, and information on speculative issues that may affect project cost. The oversight agencies and the press are invited to the monthly presentations of the PMM report to the MTA Chairman. The Quarterly Report now updates and details the status of revenue forecasts, including borrowing and investment interests.
  • Owner Controlled Insurance Programs. The Task Force recommended the establishment of a national policy on Owner Controlled Insurance Programs (OCIPs). FHWA has hired a consultant to help develop the policy, with final issuance anticipated early 2003.

Other findings from the report included:

  • The need for all key Division personnel (Financial Specialist, Right-of-way Specialist, Engineering Technical Specialists, and Planning) to review the adequacy of Financial Plans and updates.
  • The need to continually ensure that cost containment measures and mitigation of delays and conflicts remain a high-priority focus. Included in this would be rigorous controls to prevent scope change, assurance of value engineering and constructability reviews throughout the design and construction process, inclusion of items such as fuel-price adjustments in contracts to minimize bid increases due to risk, and recovery of costs associated with consultant design errors and omissions.
  • The need for FHWA to receive copies of all independent audits and validations, and to objectively review this information.
  • The need for FHWA and State personnel to realize that, once Federal funds are used for a project, that by law all project records and information must be made available for audit purposes.

Office of Inspector General Reports on the CA/T Project

The DOT Office of Inspector General (OIG) has conducted approximately 13 audits on the CA/T project. Report No. TR-2000-050 issued on February 10, 2000, and Report No. TR-2000-088, issued on June 7, 2000, have particular relevance to FHWA Oversight Managers, and should be carefully reviewed at https://www.oig.dot.gov/. In addition, the Commonwealth of Massachusetts Office of Inspector General issued a report in March, 2001, concerning the history of project finances on the CA/T project. This report can be viewed at http://www.mass.gov/ig/publications/reports-and-recommendations/central-artery-big-dig/history-central-artery-tunnel-project-finances-1994-2001-march-2001.html.

The essence of these reports gets back to the need for FHWA personnel to continuously and independently review and verify the State's management practices, costs, schedules, financial data, and project delivery. FHWA personnel must proactively seek to keep abreast of the progress and status of the project, and not just wait for problems to emerge before acting. In addition, it is essential that State and FHWA project personnel be forthright in revealing the most up-to-date and best known costs, schedules, financial information, potential exposures to costs, etc., and to fully disclose this information at regularly scheduled progress meetings or sooner if necessary. FHWA upper management must be kept informed on significant issues that may have an impact on Congress, other key Government offices or organizations, the public, or the media.

The OIG reports also identify the need to review and take action on any audits, whether the audits are conducted by the OIG, FHWA personnel, or another outside agency. The audits should not just be viewed as criticism, but rather as a means to help improve the oversight and management of the project. On the CA/T project, for example, the OIG correctly identified potential construction cost increases prior to the $1.4 billion cost increase announced in February, 2000.

Modules on Lessons Learned from the CA/T Project

The Massachusetts Division Office has compiled modules on Lessons Learned from the CA/T project. The modules are Power Point slides, and require a moderator to explain each slide. Mr. Daniel Wood, 617-494-2462, is the current contact in the Division Office to view individual modules. The following modules are available:

  • Overview Presentation. The overview module describes the CA/T project's Innovations and Advancements program, and provides a general summary of each of the 12 individual "lessons".
  • Project Management "Lessons":
    • Lesson 1. Project Director Management Issues. Provides a broad discussion on the scope and management context of the CA/T project. Experiences are shared by upper management, with detailed recommendations for management systems and process development.
    • Lesson 2. Financial Planning and Management. Discusses the Financial Management Plan for the project. Because of its size and duration, the CA/T project was the first highway project in the Nation to formally utilize a "dynamic" finance plan.
    • Lesson 3. Cost and Schedule Tracking Systems. Describes the comprehensive, monthly cost and schedule tracking system used on the project. Discusses the "early indicator" system in which items that may benefit the project are flagged for early implementation, and items that may have negative impacts are rigorously studied and corrected at the earliest possible time.
    • Lesson 4. "Day-to-Day" Management. Describes the day-to-day management of the design and construction, including the "area team" organization, partnering, interagency coordination, public outreach, use of outside consultants, delegation and single-point accountability, and the systems/process development.
  • Operations "Lessons":
    • Lesson 5. "Wrap-up" Insurance. The Owner Controlled Insurance Program (OCIP) replaced the need for individual design and construction companies to obtain their own insurance policies. OCIP's had previously been used in the building industry, but never before on a highway construction project prior to the CA/T. Included are details on the conditions and implementation of safety programs that lead to substantial cost savings.
    • Lesson 6. Innovative Contracting. A number of innovative practices were implemented, resulting in reduced cost growth through contracting arrangements. The most notable is the "Design-to-cost" program, in which project designers contractually commit to a construction cost budget.
    • Lesson 7. Cost Containment Programs. Discusses many cost containment ideas and strategies, including the value engineering experience on a Major project scale.
    • Lesson 8. Environmental and Construction Mitigation Activities. The CA/T project's commitment to keep the city of Boston open throughout the 14 years of construction meant businesses operating normally, residents experiencing minimal disruptions, and traffic moving as well or better than before construction began. Describes the mitigation program including commitments incorporated during the preliminary and design stages, monitoring of these commitments, and modifications to suit changing and unanticipated conditions during construction.
  • Technology "Lessons":
    • Lesson 9. Urban Application of Slurry Wall Technology. In confined urban settings, this technique of tunnel wall construction and stabilization will be used much more extensively in the future. It allows work to progress in tight quarters while maintaining continuous traffic movement during excavation. The CA/T project is a valuable source of information with one of the largest applications of slurry wall construction in the world.
    • Lesson 10. Soil Improvement Techniques. Due to the extremely poor soil conditions in key tunneling areas, innovative soil improvement applications including soil mixing and ground freezing were used. The concentrated, side-by-side use of soil mixing, ground freezing, tunnel jacking, and immersed tube tunnel construction presented several challenges to overcome. Describes the various soil stabilization techniques and how they were modified to accommodate specific project site conditions.
    • Lesson 11. ITS/Traffic Simulation Model. In a complex tunnel and traffic system, a reliable traffic management system is essential. The CA/T project's integrated project control system, which was developed with the help of the Massachusetts Institute of Technology, will help the completed highway system carry higher volumes of traffic more efficiently, enhance incident response, and inform motorists about highway conditions.
    • Lesson 12. Tunnel Fireproofing and Ventilation System. One of the most significant successes of the project, the Memorial Tunnel Fire Ventilation Test Program's (MTFVTP) background, methodology, and results will be described. The MTFVTP, a full-scale tunnel fire test program, was an industry-first and has improved tunnel safety around the world. This system has also helped save costs on other projects by helping designers specify cost-effective and safe ventilation systems.

Cost Estimating:

  • Cost estimates must be prepared in year-of-expenditure dollars, inflated to the midpoint of construction, with some allowance for schedule slippage taken into account. Reporting the costs in year-of-expenditure dollars will greatly reduce the media and public perception of "cost growth".
  • Reasonable contingencies should be built into the total project cost estimate. It is suggested that the following contingencies be included: 1) a Construction contingency for cost growth during construction; 2) a Design contingency based on different levels of design completion; 3) an overall Management contingency for third-party and other unanticipated changes; and 4) other contingencies for areas that may show a high potential for risk and change, i.e., environmental mitigation, utilities, highly specialized designs, etc.
  • Cost estimates should consider the economic impact of the Major project on the local geographical area. For example, material manufacturers that would normally compete with one another may be "forced" to team together in order to meet the demand of the Major project. Extremely large construction packages also have the potential to reduce the amount of contractors that have the capability of bidding on the project, and may need to be broken up into smaller contracts to attract additional competition. Bid options (simultaneous procurements of similar scopes with options to award) should also be considered for potential cost savings resulting from economies of scale and reduced mobilization. A Value Analysis should be performed on the project to determine the most economical and advantageous way of packaging the contracts for advertisement.

Cost, Schedule, and Status Reporting:

  • Cost, Schedule, and Status reporting should be done on a periodic basis (at least monthly), and must be as accurate and upfront as possible concerning cost changes, schedule delays, and other significant project issues. It is essential that open communications and close coordination between the State Transportation Agency (STA), the FHWA, consultants, local agencies, and the media be maintained at all times throughout the life of the project.
  • Periodic reporting should include reasons for cost and schedule deviations from the approved budget and schedule, impacts resulting from the deviations, and initiatives being analyzed or implemented in order to recover any cost overruns or schedule delays. Transfer of costs to and from contingency line items should also be reported, including reasons supporting the transfers.
  • Periodic reporting should include speculative cost changes that may potentially develop in the future, a quantified dollar range for each potential cost change, and the current status of the speculative change. Also, a comparison analysis to the available contingency amounts should be included, showing that reasonable and sufficient amounts of contingency remain to keep the project within the latest approved budget.
  • Areas and reasons for cost growth should be tracked and reported, for analysis in improving future cost estimates on Major projects.
  • The master program schedule for Major projects should be integrated, i.e., the individual contract milestones tied to each other, such that delays occurring in one activity will be reflected throughout the entire program schedule, with a realistic completion date being reported.

Cost Containment:

  • Decisions as to what design stage to perform Value Engineering reviews, Value Analyses, and constructability reviews should be made during the early stages of preliminary engineering, and funding for each review set up. Timely completion and implementation of these reviews can eliminate having to repackage contracts after advertisement due to a lack of competition, thereby delaying schedules. Timely analyses and reviews will also help maximize the total cost savings for the entire Major project.
  • The contract documents must be clear and unambiguous. The responsibilities of the contractors, owners, and third parties must be clearly understood by all involved parties.
  • Contractors should be brought into the project early via contractor outreach meetings, so that they can participate in the design process; provide input into the constructibility of specialized designs; and become familiar with the scope of work, design details, and special site conditions.
  • A reasonable and credible plan to finance the entire Major project must be in place at the start of construction. Major projects can no longer be financed on the "pay-as-you-go" basis, which further lends the project to scope and cost increases. Also, because of the extraordinary resources required to fund Major projects, consideration must be given to balancing the entire Statewide program to obtain funding equity for other necessary road and bridge programs.
  • A Project Management Plan should be developed during the early stages of design, with the ultimate purpose of clearly defining the roles, responsibilities, processes, and activities which will result in the Major project being completed on time, within budget, with the highest degree of quality, and in a safe manner. The Scope of Work should be clearly defined in the Plan, along with change order and claims controls and other cost containment strategies to be used throughout the life of the project. Upper management buy-in from all sponsoring agencies should also be included in the form of a signature page.
  • On highly sensitive environmental projects, an environmental monitoring team should be established with input and buy-in from involved cooperating agencies, in order to maintain a working knowledge of permits and commitments, to monitor contractor activities and maintain documentation, and to proactively lend guidance and resolve environmental issues and concerns before they impact the project schedule.
  • Wrap-up or Owner Controlled Insurance Programs (OCIP) should be considered at the onset of Major projects to determine if overall insurance costs reductions can be realized, along with improvements in the safety of construction operations.
  • Safety must be a primary focus and must be stressed from the corporate level down to each individual participant, with regularly scheduled safety meetings, inspections, and training.
  • Innovative contracting techniques such as Design-Build, cost-plus-time bidding, lane rental, etc. should be considered to determine if overall cost and time savings can be realized. Design-Build contracting on Major projects has thus far shown very little increase from the negotiated contract amount to the final project completion, with a major overall design and construction time savings realized.

Project Personnel:

  • Project personnel must completely cooperate in any audits or reviews performed by Federal or State audit agencies. The audits should not just be viewed as criticism, but rather as a means to help improve the management and delivery of the Major project. Project personnel must completely review the audits, and take appropriate action on any recommendations having merit.
  • Project team must have experienced key personnel dedicated to the success of the Major project, with the requisite technical, managerial, leadership, and communication skills needed to proficiently perform the required tasks. A high standard of ethical integrity is a must.
  • The use of consultants on Major projects must be carefully structured and reviewed, to make sure that no conflicts of interest exist from a Government-Contractor relationship aspect, and to ensure that no one consultant is responsible for both a design/construction role and an oversight role.


  • Numerous technical lessons learned in the areas of: 1) slurry wall construction in urban areas; 2) soil improvement techniques; 3) ITS/traffic simulation models; 4) immersed tube tunnels; 5) tunnel jacking; and 6) tunnel fireproofing and ventilation systems has been compiled from the Boston Central Artery/Tunnel project, and are available through the "Innovations and Advancements" workshop conducted by FHWA.
Updated: 06/27/2017
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