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Publication Number:  FHWA-HRT-17-006    Date:  September 2017
Publication Number: FHWA-HRT-17-006
Issue No: Vol. 81 No. 2
Date: September 2017

 

Getting A Grip on Risks

by Laurie Butts, Carlos F. Figueroa, and Dianne Gunther

The Pennsylvania DOT is conducting a structured approach for managing threats and opportunities on a bridge replacement—and it is proving to be useful.

Imtiaz Nathaniel, PennDOT District 5
PennDOT is applying a SHRP2 product known as Managing Risk in Rapid Renewal Projects to understand the impact of risks and related mitigation actions for several alternatives for replacing the historic Cementon Bridge, shown here.
PennDOT is applying a SHRP2 product known as Managing Risk in Rapid Renewal Projects to understand the impact of risks and related mitigation actions for several alternatives for replacing the historic Cementon Bridge, shown here.

The 84-year-old Cementon Bridge in Whitehall Township, PA, carries more than 16,000 vehicles per day over the Lehigh River. However, like many of the Nation’s bridges, the structure requires replacement to ensure its continuous operation and functionality for travelers. Due, in part, to its proximity to historic properties, replacing the Cementon Bridge is a complex project with a high risk of cost overruns and schedule delays.

Traditional risk assessment and mitigation activities used by transportation agencies often lack rigor and formality during the continuum of project planning, design, and delivery. Failure to adhere to a formal process of risk analysis can result in unanticipated problems, delays, and costs. In addition, finding solutions during later phases of a project can be more difficult and costly.

To identify and mitigate risks proactively on the Cementon Bridge replacement project, the Pennsylvania Department of Transportation (PennDOT) conducted a comprehensive in-house risk assessment using a product developed through the second Strategic Highway Research Program (SHRP2). The product, Managing Risk in Rapid Renewal Projects, presents a formal risk management process that optimizes performance for accelerated reconstruction on projects. PennDOT used the product for the Cementon Bridge project to identify, assess, mitigate, allocate, and monitor risks.

Project Characteristics

PennDOT anticipates that construction of the new Cementon Bridge will begin in 2019, and design and construction combined will cost approximately $20 million to $23million in year-of-expenditure (YOE) dollars (base cost estimate). The existing bridge is in poor condition because of its deteriorated structural condition, which has resulted in a load posting restriction to maintain safety. In addition, the bridge is unable to accommodate current and future traffic needs because of the geometric constraints. This project is not only critical to Pennsylvania’s transportation infrastructure, it is also unusually complex, with many constraints that could threaten its on-time, on-budget completion.

The Cementon Bridge is a four-span, 575-foot (175-meter)-long bridge constructed in 1933. The bridge carries SR–0329 over the Lehigh River and serves as the primary link between Cementon and Northampton Borough. It also connects the Laurys Station and Northampton segments of the Delaware and Lehigh Trail. The structure is eligible for listing in the National Register of Historic Places (NRHP), and is near historic districts within Northampton County.

The bridge’s location is highly constrained because it abuts the Norfolk Southern railroad and the Siegfried Cemetery. The structure also carries multiple utilities, including fiber optic data lines, a water main, and aerial high-voltage power lines.

Although this project is large enough to justify a full probabilistic risk assessment, PennDOT chose an in-house risk management process that was both comprehensive and easy to apply. The reason was so that staff could learn the process and then use it on future projects of various sizes and types.

Managing Risk in Rapid Renewal Projects

Managing Risk in Rapid Renewal Projects was the ninth research project in the SHRP2 Renewal focus area and is also known as Renewal09 (R09). The product uses an Excel®-based template to guide teams through a risk management process to identify, evaluate, and mitigate risks. Departments of transportation can adjust the template settings to fit their projects’ unique characteristics by defining a project’s delivery method, base cost, and base schedule. The accompanying R09 guide provides additional tools to assist with each step. The guide is available at www.trb.org/Main/Blurbs/168369.aspx.

During a 2.5-day workshop hosted by the Federal Highway Administration, PennDOT’s team of project managers, in-house subject matter experts, and consultants applied the product’s iterative process to the Cementon Bridge. The goals of the workshop were to identify potential risks holistically, determine the likelihood of risk occurrence, calculate the associated impact on cost and schedule, devise strategies to mitigate and monitor risks from planning to construction, assess the overall impact of mitigated and unmitigated risks on schedule and cost, and implement a risk management plan as part of the overall project delivery process.

PennDOT applied the process to two design alternatives it was considering, and will use the results to inform its final decision. Alternative A uses on-line (no change in alignment) accelerated bridge construction (ABC), and Alternative B uses a downstream alignment.

Alternative A involves constructing a new bridge superstructure adjacent to the existing structure, plus new piers and abutments under the existing structure, while traffic is maintained on the existing structure. The existing superstructure will be removed and new pier and abutment seats will be built, and the new superstructure will “slide in” onto new piers and abutments during a short-term bridge closure and traffic/pedestrian detour. The primary benefit of this alterative is that it maintains the existing alignment, which minimizes the impact on the right-of-way, environment, and abutting railroad. The disadvantages are higher cost, high uncertainty in contractor bids and capability, utility relocation (twice), and a traffic detour during the slide-in.

Alternative B involves constructing a new bridge downstream while maintaining traffic on the existing bridge. This alternative also would involve constructing roadway tie-ins to connect SR–0329 to the new bridge. The primary benefit is that it minimizes the impact on utilities and maintains traffic on the existing bridge throughout construction. The disadvantages are a required right-of-way acquisition with residential displacements, involvement of the Pennsylvania Public Utility Commission, and relocation of the railroad crossing.

The Cementon Bridge project team discussed potential threats and opportunities while applying the R09 risk management process at a workshop.
The Cementon Bridge project team discussed potential threats and opportunities while applying the R09 risk management process at a workshop.

 

“The R09 workshop identified a lot of risks with the ABC alternative that the downstream alternative may alleviate,” says Brian Shunk, project development engineer with PennDOT. “R09 may lead PennDOT to a different decision about these alternatives than what was previously anticipated.”

Project Scope, Structuring, and Risk Identification

The 7-step R09 risk management process helped PennDOT identify the most severe threats and opportunities, and the most beneficial mitigations to improve project costs and schedule performance. Because the process is so efficient, PennDOT completed the full risk assessment on each of the two alternatives in 2.5 days to help determine the best approach.

The agency kicked off the risk management process by familiarizing the team with the project scope, strategy, and conditions. The project manager discussed the two bridge replacement alternatives, funding, technical conditions affecting the project, political and external factors, and cost and schedule estimates.

Next, the team structured the project by defining the base project scenario for duration/schedule and cost, without accounting for intentional float, contingency, or inflation. The base performance data are entered into the R09 template and used as a comparison against the project’s unmitigated and mitigated performance, which includes the threats and opportunities that are identified, assessed, and managed.

Source: USDOT Volpe Center.
Diagram showing the R09 Risk Management Process. Step 1 is confirming Project Scope/Strategy/Conditions, step 2 is Structuring, step 3 is Risk Identification, step 4 is Risk Assessment, step 5 is Risk Analysis, step 6 is Risk Management Planning, and step 7 is Risk Management Implementation. The circular, clockwise flow of the diagram shows the steps in order, circling back to step 1.

Threats can degrade project performance, while opportunities can enhance project performance. PennDOT identified 44 threats and 3 opportunities for Alternative A, and 34 threats and 7 opportunities for Alternative B. The project team documented the threats and opportunities in the risk register developed in the R09 template and categorized by when they are most likely to occur (for example, construction, preliminary design/environmental process, and procurement). The purpose of this step is to capture a comprehensive, nonoverlapping list of threats and opportunities, rather than screening out issues prematurely.

“Even though it was early in the project, bringing together PennDOT staff and consultants helped us identify risks that we [might] not have otherwise,” says Laura Montgomery, consultant project manager for the Cementon Bridge replacement. “[Because] we are still in the preliminary design phase, there is time to coordinate among agencies to best address risks. That’s the real benefit to the whole R09 product–it’s a great way to identify risks ahead of time and know what you’re up against.”

Risk Assessment, Analysis, and Management Planning

PennDOT assessed the probability of occurrence, effect on mean cost (in dollars), and effect on mean schedule (in months) of each threat and opportunity. They can be assessed using predefined ratings that are linked to a range of values, or using direct mean values. For example, PennDOT noted that for Alternative A, the Pennsylvania Department of Environmental Protection may not want to issue a permit for the causeway because of its size and the impact on the migration pattern of shad, a species of fish that inhabit the Lehigh River. PennDOT assessed this risk as having a very high probability of occurrence (85 percent likelihood). In addition, PennDOT assessed this risk as having a high mean impact (8 months) and a low mean cost impact ($370,000).

After assessing all of the threats and opportunities, the team used the R09 template to calculate and document the mean severity of each risk to help the project team address the most severe threats and beneficial opportunities.

Using the output from structuring, risk identification, and risk assessment, PennDOT combined the base performance data and risk assessments to calculate the impact of each threat and opportunity on the project schedule, and the costs if the risks remained unmitigated. Understanding the impact of unmitigated risks will help PennDOT make informed decisions through analysis from planning to construction.

The project team then planned potential actions to mitigate the top 15 threats and the 2 highest severity opportunities from the unmitigated risk register for Alternative A, and the top 7 threats for Alternative B (risk management planning). For example, the team recommended performing a constructability review, which would include external experts, to mitigate potential feasibility concerns for Alternative A. For Alternative B, the team recommended conducting additional subsurface investigation and testing during the design phase, and developing a relocation plan if they encountered gravesites.

Top Risks from the Unmitigated Risk Register
Alternative A: ABC Replacement Alternative B: Downstream Replacement
  1. Preferred alternative could prove to be unfeasible due to constructability concerns.
  1. Design supplement could be needed for preliminary engineering for downstream alternative, which would require additional designefforts.
  1. Contractor bid price could be high because of bridge slide technology, based on project complexity and PennDOT’s minimal experience.
  1. Preliminary engineering will require additional time, delaying the schedule.
  1. Pennsylvania Department of Environmental Protection might not issue permit for causeway.
  1. Construction could impact gravesites because of the unknown extent of cemetery boundaries.

 

Top Risks from the Mitigated Risk Register
Alternative A: ABC Replacement Alternative B: Downstream Replacement
  1. Contractor bid price could be high because of bridge slide technology, based on project complexity and PennDOT’s minimal experience.
  1. Design supplement could be needed for preliminary engineering for downstream alternative, which would require additional designefforts.
  1. Preferred alternative could prove to be unfeasible because of constructability concerns.
  1. Preliminary engineering would require additional time, delaying the schedule.
  1. Public might find the 14-day closure for the bridge replacement unacceptable.
  1. Alternative could prove to be unreasonable under the National Environmental Policy Act because of the impact on the cemetery.

 

Comparison of Base Project Performance,
Unmitigated Performance, and Mitigated Performance
  Base Unmitigated Mitigated Mitigation Savings
Alternative A Cost (YOE) $22.54 million $29.07 million $25.50 million $3.57 million
Construction Notice to Proceed 6/30/2019 3/17/2021 4/20/2020 11 months
Construction Completion Date 3/29/2022 2/06/2024 2/08/2023 12 months
Alternative B Cost (YOE) $20.41 million $24.21 million $24.80 million -$590,000 (additional costs)
Construction Notice to Proceed 12/29/2019 2/26/2021 10/18/2021 Delayed 7.8 months
Construction Completion Date 9/12/2022 12/18/2023 7/18/2024 Delayed 7.1 months
Source: FHWA and PennDOT. YOE = Year of Expenditure.

 

Using the R09 template, the project team assessed the impact of the mitigation actions using mean values or predefined ratings on project cost and schedule. This resulted in a mitigated risk register that documents the resulting project performance impact if the selected mitigations are applied.

Next, PennDOT used its mitigated risk register to conduct a final cost and schedule performance analysis. The agency compared the project cost and construction duration among the base, unmitigated, and mitigated project performance for each alternative. The mitigated performance includes all residual risk (the portion of the threats and opportunities that remains after mitigation).

Note that for Alternative B, the mitigated performance is more costly and delays the schedule beyond the unmitigated performance. In this case, PennDOT may choose to forego mitigations if the risks themselves are less costly than the mitigations.

Renewal 09 Risk Management Pays off in Arizona

Vehicles travel through the completed interchange project at Bell Road and Grand Avenue (U.S. 60) in Surprise, AZ. This project benefitted from a SHRP2 R09 demonstration workshop.
Vehicles travel through the completed interchange project at Bell Road and Grand Avenue (U.S. 60) in Surprise, AZ. This project benefitted from a SHRP2 R09 demonstration workshop. Photo: ADOT.

The Arizona Department of Transportation (ADOT) recently constructed a grade-separated interchange to elevate Bell Road over Grand Avenue (U.S. 60) and the BNSF Railway railroad to ease congestion and increase capacity of this busy intersection in Surprise, AZ. During the project development stages, FHWA conducted a SHRP2 R09 demonstration workshop with ADOT staff and project consultants. This workshop, held in December 2014 in Phoenix, produced a list of prioritized threats and opportunities for the project and identified mitigation strategies, which could affect project cost and scheduleperformance.

In January 2017, near the completion of the construction project, ADOT and FHWA met again to compare the predicted project performance from the December 2014 workshop with the actual performance. The project results clearly demonstrate the positive impact of risk management on the project.

The project team implemented the following mitigation strategies, as identified during the R09 workshop:

  • Full closure of Bell Road. This opportunity reduced staging work from two major phases to one, which eliminated the need for temporary structures and opened more working area to enable expediting construction activities. The public and business owners supported a full closure of Bell Road because of the overall shorter construction duration.
  • Towne Center Drive right-of-way (ROW) impacts. The alignment of Towne Center Drive was not redesigned and, as a result, this decision minimized ROW impacts to the businesses located along thisdrive.
  • Modifications to 134th Drive/Avenue. The project team modified the alignment design of 134th Drive/Avenue to avoid ROW impacts on localbusinesses.

In terms of cost performance, the total project cost as of January 17, 2017, including 18 change orders and a 5-percent construction contingency, was $49.8 million (YOE). The total additional cost of the 18 change orders was approximately $417,000. However, this cost is significantly lower when compared to the December 2014 R09 work-shop unmitigated cost estimate of $60.7 million (YOE), which excluded all contingencies and intentional float and all identified mitigations that were assessed during the workshop. The change orders reflect experienced threats and opportunities that occurred during the design and construction phases of the project. A direct comparison of the December 2014 cost estimate and the January 2017 total project cost is somewhat difficult because of the changes in the project scope and approach, but the project team’s ability to mitigate critical threats and implement opportunities is reflected in significant cost and schedule performanceimprovements.

An additional benefit is the savings associated with reductions in the project schedule. This was computed by comparing engineering and inspection costs and overhead for the 24 months of total anticipated construction time versus the actual construction duration of 14months. The 24-month estimate is based on the duration assumed at the time of procurement. The only change in contract time was the project intermediate completion date because of roadwork beginning in April 2016 instead of March 2016, and the collapse of a bridge girder. As a result of the 10-month schedule reduction, the project staff estimated $1.6million (YOE) of savings in construction engineering andinspection.

As a result of this exercise, PennDOT had a much better understanding of the risks associated with both alternatives, and it planned a followup meeting to discuss the project in further detail and come to a conclusion on a recommended alternative.

“The implementation of the R09 process on the Cementon Bridge project was very beneficial in that it gave us an opportunity to bring together a diverse group of stakeholders to ensure that the project risks are known, communicated, and collaboratively addressed with response strategies,” says Phillip Bobitz, transportation engineer with the FHWA Pennsylvania Division. “The R09 workshop demonstrated how risk management is an integral part of the project delivery process and, ultimately, will enhance project estimates and schedules.”

Risk Management Implementation andBenefits

To finalize the risk management plan, PennDOT identified who within the agency would be responsible for implementing each risk mitigation action to ensure that risks continued to be monitored throughout the project life cycle. The responsible person is the key individual to facilitate and manage implementation of the action selected for risk management.

HDR, Inc.
The Cementon Bridge carries SR–0329 over the Lehigh River in eastern Pennsylvania.
The Cementon Bridge carries SR–0329 over the Lehigh River in eastern Pennsylvania.

 

Applying the R09 risk management process has already helped PennDOT to evaluate two alternatives and their associated risks effectively; create a risk management plan to mitigate and monitor risks; develop a clearer understanding of and better define the project’s scope, strategies, and conditions earlier in the planning stages and prior to construction; and use the risk assessment data to explore proposed project strategies, document potential mitigations, and evaluate their benefit-cost ratio.

PennDOT will continue to use R09 to reevaluate risks based on changing information leading up to the Cementon Bridge construction phase, scheduled to begin in 2019.


Laurie Butts is a senior communications specialist who works with the U.S. Department of Transportation’s Volpe National Transportation Systems Center. She holds a B.S. in marketing communications from James Madison University and a Master of Professional Communication degree from Westminster College.

Carlos F. Figueroa is the FHWA program manager for SHRP2 R09 and R10 Project Management Strategies for Complex Projects in the Office of Program Administration. He is responsible for the deployment and implementation of these tools for more than 20 State DOTs. Figueroa has a B.S. in civil engineering from the University of Puerto Rico and an M.S. in construction management from Virginia Tech. He is a registered professional engineer in Georgia and Puerto Rico, and is a certified Project Management Professional®.

Dianne Gunther is a program analyst at the U.S. Department of Transportation’s Volpe National Transportation Systems Center. She has a B.S. in civil engineering from Cornell University and an M.S. in transportation from theMassachusetts Institute of Technology.

For more information, see www.fhwa.dot.gov/GoSHRP2/Solutions/Renewal/R09 or contact CarlosF. Figueroa at 202–366–5266 or carlos.figueroa@dot.gov.

 

 

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