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(EST-2501) Engineering Estimate Accuracy of Highway Construction Alternative Delivery Methods

Level: Intermediate
Author(s): Douglas S. Alleman, PE; Dr. Daniel Tran; Arthur Antione; Dr. Keith Molenaar
Venue: 2017 AACE International Annual Meeting, Orlando, FL

Abstract: Early accuracy in highway cost estimating is vital for proper project planning and program budgeting. The primary audience for this research includes state and federal departments of transportation (“agencies”) using or developing alternative project delivery methods. This study focuses on examining Engineering Estimate (EE) accuracy across four main delivery methods in highways, including: design-bid-build (D-B-B), design-build/best value (D-B/BV), design-build/low bid (D-B/LB), and construction manager/general contractor (CM/GC). The objective of this paper is to explore the estimating accuracy of project delivery methods, and where inaccuracies exist, explore whether agencies typically over or under estimate the contract award value. The main findings are as follows: 1) D-B/BV and D-B-B have no difference in means of EE accuracy; 2) agencies obtain the greatest estimating accuracy for CM/GC projects; and 3) agencies tend to overestimate D-B-B, D-B/LB, and D-B/BV. These findings come from analyzing 275 state and federal highway construction projects, completed from 2004 to 2015, validated by agency representative interviews. This paper contributes to the construction body of knowledge by presenting one of the first studies that evaluate the accuracy of agency estimates across different project delivery methods in highways and is the first to empirically prove that CM/GC highway construction projects have greater EE accuracy than other delivery methods.