Analysis of Construction Quality Assurance Procedures on Federally Funded Local Public Agency Projects

CHAPTER 1. INTRODUCTION

BACKGROUND

Federal-aid projects administered by local public agencies (LPA) provide the opportunity for all three levels of government (Federal, State, and local) to partner for the purposes of building better communities and developing and improving our highway system. As summarized in figure 1, each of these entities assumes a distinct role in the delivery of a locally administered project (LAP).

Figure 1. Illustration Delegation of responsibilities on LPA projects.

The Intermodal Surface Transportation Efficiency Act of 1991; the Transportation Equity Act for the 21st Century of 1998; and the Safe, Accountable Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) of 2005 establish the respective roles and responsibilities of the Federal Highway Administration (FHWA) and State transportation departments in providing stewardship of Federal-Aid Highway Program activities under Title 23, United States Code, and other associated laws. (See references 7, 8, 9, and 1.)

An LPA, viewed in Federal regulations as a sub-recipient of Federal funds, must demonstrate to the State transportation department that it has adequate project delivery systems and sufficient accounting controls to properly manage Federal funds. Once approved or certified by the State transportation department to administer Federal-aid projects, an LPA may assume various project responsibilities, including the following:

• Project selection.
• Location and design.
• Utility and railroad agreements.
• Standard consulting engineering agreements.
• Environmental documentation.
• Plans, specifications, and estimates.
• Advertisement, award, and execution of construction contracts.
• Construction administration.
• Construction quality assurance (QA), including material testing and testing personnel.

In particular, Section 1904 of SAFETEA-LU revised §106 of Title 23 of the U.S.C. to broaden the States’ oversight responsibilities and requires that sub-recipients of Federal-aid funds have adequate project delivery systems for projects approved under this section. This section also requires that the FHWA periodically review the monitoring of sub-recipients by the States.⁽⁹⁾

PROCESS REVIEWS

National reviews of LPAs conducted by FHWA in 2006 and the Office of Inspector General (OIG) from November 2009 through April 2011 revealed shortcomings not only in the efforts of LPAs to properly administer Federal-aid projects, but also in the role and effectiveness of oversight activities performed by the FHWA Division Offices and the State transportation departments to ensure LPA compliance with Federal requirements. Some of the general weaknesses identified in these audits are summarized in table 1.

Table 1. Weaknesses found in LPA program.

Such findings were based on only a limited number of LPA projects sampled in a handful of States. Nevertheless, the extent of noncompliance suggests the likelihood of similar deficiencies occurring in LAPs constructed nationwide. Because current estimates indicate that approximately 20 percent of the Federal-aid program is invested in LPA-led infrastructure projects, the potential for mismanagement and waste is not trivial in scale.

One primary area of concern is oversight of construction quality. The report states, “The team found that design and construction quality was highly variable, and the quality and availability of records made it difficult to verify compliance. It was also determined that material testing was often either not done or was undocumented leaving project quality and durability questionable.”⁽²⁾

These reviews indicate that construction QA practices on many locally administered Federal-aid projects are in need of improvement. However, before improvements can be made, a more detailed understanding of the problem is needed from both the State transportation department and LPA perspectives.

23 CFR 637

All Federal-aid projects on the National Highway System (NHS)—including those administered by LPAs—are subject to the QA procedures in 23 CFR 637, Subpart B—Quality Assurance Procedures for Construction, promulgated by FHWA for projects using Federal-aid funds 23CFR 637.⁽¹⁾ In 23 CFR Part 470—Highway Systems, NHS projects, are defined as follows:⁽¹⁰⁾

• [I]nterconnected urban and rural principal arterials and highways (including toll facilities) which serve major population centers, international border crossings, ports, airports, public transportation facilities, other intermodal transportation facilities and other major travel destinations; meet national defense requirements; and serve interstate and interregional travel. All routes on the interstate system are a part of the National Highway System.

For projects off the NHS, generally described as local roads or rural minor collectors, the established procedures approved by the State transportation department can be used for material acceptance as long as they satisfy the intent of the Federal requirements (23 CFR 637, subpart B).

In accordance with 23 CFR 637, a comprehensive construction QA program should consist of the following core elements: quality control (QC), acceptance, independent assurance (IA), dispute resolution, personnel qualification, and laboratory accreditation/qualification, which can be defined as follows:

• QC is process control testing conducted by the contractor to adjust production or construction work as necessary to control quality.
  
  
• Acceptance is the process of deciding whether to accept or reject a product or accept at adjusted payment. When contractor test results are used in the acceptance decision (as is often the case in current statistically based QA pavement specifications), this process should include inspection, contractor testing, agency verification, and possible dispute resolution. The agency’s acceptance program should contain a reasonable level of visual inspection to ensure quality and workmanship meets the specified requirements. Testing, while important, may not reveal all workmanship problems.
  
  
• IA is unbiased testing performed to ensure that sampling and testing activities are being performed by qualified personnel using proper procedures and properly functioning and calibrated equipment. The objective of IA is to assure the reliability of all data used in the agency’s acceptance decision—including both the agency’s verification test results and the contractor’s QC testing (if included in the acceptance decision). The results of IA tests should not be used as a basis of product acceptance.
  
  
• For QA programs permitting the use of contractor test results in the acceptance decision, an agreed upon Dispute Resolution procedure is used to resolve conflicts resulting from discrepancies between contractor and agency test results.
  
  
• Test data used in the agency’s acceptance decision must be obtained using testers and laboratories having the appropriate qualifications and accreditations (23 CFR 637, Subpart B).⁽¹⁾

Although many of the features and elements required under 23 CFR 637 have been incorporated into current State transportation department acceptance plans, QA procedures and acceptance plans still vary considerably among State transportation departments. Furthermore, the sub-recipients of Federal-aid funds–affiliated LPAs—vary to an even greater extent in terms of how quality management is implemented, the level of QA expertise within the LPA, adequacy of documentation, and the level of oversight from the State transportation department. This extreme variability underscores inherent problems in the consistent implementation and compliance with QA procedures in use today. More recent legislation under SAFETEA-LU broadened the responsibilities of State transportation departments to provide adequate oversight of LPA project delivery as the sub-recipients of Federal funds.⁽⁹⁾ The legislation also requires that FHWA periodically review and monitor this State oversight. The challenge for FHWA will be to improve both the consistency of State transportation department oversight of QA procedures and develop practical QA procedures for LPAs that account for the various types, sizes, and scopes of LPA projects receiving Federal-aid funding.

With this understanding of the QA requirements for LPA projects and the reported shortcomings as the baseline, this study was needed to not only document the extent of the problem and specific areas needing improvement, but also to identify any existing best practices suggested by State transportation departments and LPA practitioners that could resolve the current shortcomings.

OBJECTIVES

This research had the following general objectives:

• Document current QA practices used on locally administered Federal-aid projects from State transportation department and LPA perspectives, including material sampling and testing, as well as inspection practices.
  
  
• Identify specific issues or areas of weakness in QA practices from both the State transportation department and LPA perspectives.
  
  
• Identify existing successful practices that could be applied to generally improve construction QA across the full spectrum of LAPs.

The scope of the study covered various types, sizes, and scopes of transportation projects delivered by LPAs, focusing on the construction and closeout phases.

RESEARCH APPROACH

This study involved the collection of existing documentation and research, and the analysis of survey and interview data from various State transportation departments and LPAs. The information was collected through a comprehensive review of existing literature, process reviews, and procedural documentation; a national survey of both State transportation departments and LPA organizations; and targeted telephone and onsite interviews with a select number of State transportation departments and LPAs that represented a diverse cross-section of organizational programs and geographic locations.

Literature Review

The literature review consisted of review and content analysis of national process reviews conducted by FHWA in 2006 and subsequent FHWA Project Management Improvement Team (PMIT) reviews and audits conducted by the State transportation departments either alone or jointly with the FHWA Division Offices. The literature review documented all the existing or ongoing research addressing QA for LPA projects and consisted of a content analysis of LPA guidance documents.

Survey

The survey instruments were designed for both State transportation department and LPA respondents. The research team solicited members of both the American Association of State Highway and Transportation Officials (AASHTO) Subcommittee for Materials and Construction for the State transportation department contacts. For the LPA contacts, the research team drew from an existing database of LPA contacts from previous research and from State transportation department referrals. The surveys were designed and implemented as an online tool requiring minimum effort on the agencies’ part to ensure an adequate response rate.

The State transportation department survey included questions concerning the State transportation department organizational structure and oversight of LPA programs. Similarly, the LPA survey included questions addressing the LPA construction program size, Federal-aid project types, use of in-house versus consultant staff for QA, and the existence of internal QA guidelines. Both the State transportation department and LPA questions asked respondents to identify the levels of oversight or construction QA (i.e., levels of inspection and testing) applied to various project types. The surveys also ask respondents to rate the frequency of occurrence and severity of impacts related to various QA issues identified in the phase 1 content analysis. Lastly, the surveys ask respondents to identify practices that have been successfully applied to mitigate QA issues for LPA projects. The questions were designed to allow the team to determine trends or correlations in the data, and rank or prioritize issues according to their frequency and potential impact. The survey questionnaires for the State transportation department and the LPA respondents can be found in appendices A and B.

Interviews

The goals of the interviews were to (1) validate the results of the survey round and (2) gather detailed information and insight into the likely causes of issues or noncompliance, and best practices that can be used to resolve these issues. The interviews allowed the team to obtain more complete, indepth responses to the survey questions, validate the initial survey results with particular emphasis on identification of issues and weaknesses in QA procedures for LPA projects, and identify successful QA for LPA practices that optimize or mitigate weaknesses. As in the case of the surveys, the questions were designed for both State transportation department and LPA staff to allow the team to determine trends or correlations in the data, and rank or prioritize issues according to their frequency and potential impact.

Based on the initial literature reviews and survey results and feedback from the technical panel, the team targeted the following States (including State transportation departments and LPAs suggested by State transportation department staff) for interviews that included the items listed in table 2.

Table 2. State transportation departments selected for interviews.

The interview forms for State transportation department and LPA interviewees are provided in appendices C and D.

Evaluation of Data

Based on the content analysis of data collected in the literature review and the survey and interview results, the team aggregated the data and evaluated it, keeping in mind the key components of a QA program that meet the requirements for 23 CFR 637. In addition, the team identified how issues and best practices may differ based on size and makeup of the LPAs, and the types, sizes, and scopes of the projects being administered by these LPAs. The team also looked for trends, common themes, and characteristics that emerged from synthesizing the data. The team used, as appropriate, a variety of ways to portray the information in a user-friendly format, including tables, bar charts, and figures.

Based on the results of this synthesis of the information and data, the team first identified and classified key risk issues and differences in the perceived significance of the issues from the State transportation department and LPA perspectives. After identifying the issues related to LPA QA practices, the team then classified and ranked these in terms of their respective frequency of occurrence and consequences of issues.

Based on the content analysis of documents collected in the literature review and the survey and interview results, the team identified and similarly classified best practices from both the State transportation department and LPA perspectives. The team then prioritized these successful practices in terms of their perceived benefit (or positive impact) on either the State transportation department or LPA using a similar evaluation approach to that described above, and lastly aligned issues with successful practices that can potentially mitigate or address the issues identified. In essence, this step serves as the mitigation step in a risk assessment process.

Final Recommendations

The final recommendations also suggested which party would be in a position to implement the best practice to manage or address the issue. Ideally, most of the issues can be addressed at the LPA (project) level or at the State level. Others may require action by the FHWA Division office or Headquarters. This consideration will inform the best practices identified by the research and any future research needs.