March/April 2006
Helping Roadway Contractors Fulfill Public Expectations
by Kathleen A. Bergeron
Incentive
and disincentive provisions can help motivate highway builders to complete
projects economically, safely, and quickly.
|
(Above) Long lines such as this one and motorists' short tempers are
among the costs borne by the public when roadwork drags on. How to
motivate contractors to complete projects quickly is an increasingly
important issue for DOTs. Photo: AAA Foundation for Traffic Safety. |
A
joke that made the rounds a few years back tells of a software mogul who,
speaking at a computer trade show stated that if the automobile industry had
kept up with technology the way that the computer industry does, everyone would
be driving $25 cars that average 1,000 miles to the gallon.
The joke continues: In response,
the auto industry issued a press release stating that if it had developed
technology the way the software industry does, cars would have some rather odd
quirks. Every time workers repainted the lines on the road, motorists would
have to buy a new car. For no reason whatsoever, the car would crash twice a
day. Maneuvers such as a left turn occasionally would cause the car to shut
down and refuse to restart, and the motorist would have to reinstall the
engine. The airbag system would ask, "Are you sure?" before deploying. And
every time a new car was introduced, buyers would have to learn to drive all
over again because none of the controls would operate the same as they did in
the older car.
Although amusing, the story
perhaps is more valuable as an object lesson than as a joke: People in the
highway community might well ask themselves, "How well do I serve my
customers compared to the way other industries serve theirs?"
|
Traffic circles, such as the one shown
here under repair, and other areas
where vehicles need to merge are
especially susceptible to wear and
tear-and to public frustration when
the merging areas are tied up during
maintenance projects. |
How does the highway industry
compare, for example, with utilities such as water, electricity, or natural
gas, or with other public services? Better yet, how does it compare with more
competitive consumer-products industries—manufacturers of laundry detergents,
breakfast cereals, soft drinks, and, yes, automobiles and computers? On some
level, all are trying to do the same thing—make their customers happy.
Further, State departments of transportation (DOTs) also have the
responsibility to provide a safe and efficient driving experience.
"One of the greatest challenges
for State DOTs is motivating construction contractors to achieve or even
surpass an agency's goals for customer satisfaction," says former New Jersey
Department of Transportation Commissioner Jack Lettiere. When several
contractors bid on a highway construction project, and the lowest bidder gets
the job, how does the DOT motivate the winner to complete the project better,
faster, or with less impact on the traveling public? In other words, how does a
DOT encourage contractors to build highway projects in such a way that the
process responds to the public's desires and needs?
|
Repairing or replacing bridges such as this one seems to guarantee
inconvenience for motorists, but State DOTs are chipping away at that
"fact" through incentives to speed construction. |
The obvious way is simply to
demand it—write specifications and contract provisions that clearly define the
schedule requirements. The problem with such an approach is that the DOT may
not receive any bids if it makes the project requirements too stringent,
or contractors may include large contingencies in their bids to offset
potential loses if they do not meet the contracting agency's schedule.
Moreover, if the agency specifies exactly how it wants the project done, it is
not benefiting from the creativity of the marketplace. The very basis of a
free-market economy is that the company or individual who can come up with a
better approach gets the advantage. So if a DOT can somehow devise a way for a
contractor to use its own creativity to reach a specified level of performance,
the result will be a win-win for both the DOT and the private firm.
|
The public's desire for smooth
roads has motivated DOTs to
resurface rural lanes, such as
those shown here, as well as
urban roads. |
A Two-Way Street
Of course, the challenge is not simply persuading
contractors to respond appropriately to what is required of them. It also
entails knowing exactly what to demand in the first place. What, precisely,
does the public want with regard to particular roads or projects? And how do
DOTs gather that information?
Like other government
organizations, most transportation agencies maintain an office that has the
responsibility of communicating with the public. Usually the office is dubbed
Public Affairs or Public Information or Public Outreach. Much of the office's
work is one-way communication: telling the public the story the agency wants to
deliver. The office sends press releases to the media (which, it is hoped, will
convey the story to the public), distributes brochures at hearings and trade
shows, and publishes newsletters geared toward specific projects that target
businesses and residents who may be affected by the projects.
Although such communications help
demonstrate how an agency is spending the funds entrusted to it, something may
be missing. In comparison to the volume of information leaving the agency, very
little feedback from highway users is brought into the organization to help
determine its responses to the public's wants and needs. True communication,
however, is a two-way street, providing information and listening or receiving
feedback.
This deficiency is not unique to
highway agencies. In a 1976 article published in Public Relations Review,
authors Sue H. Bell and Eugene C. Bell discuss two approaches to public
relations, one they call "functionary" and the other "functional." The
functionary approach is based on the assumption that the purpose of public
relations (or public affairs, or public outreach) is limited to effecting
changes to the environment outside the organization. On the other hand,
functional public relations assumes that changes can be made to the organization
itself as a result of information gained from outside.
"Functionaries" attempt to
preserve and promote a favorable image of the organization in the community
based on the hypothesis that if the organization is "liked," the public will
continue to absorb its outputs. In contrast, "functionals" seek outside
information to see where the organization can better serve its constituents.
So, instead of talking about "relating to the public," or "public relations,"
the reference is to two-way communication. And in private industry, being able
to change a product or service (whether it is computers, automobiles, or
whatever) to meet the public's changing needs can be critical to survival. This
is important for public agencies too. Consider for a moment how local fire
departments have changed over the last 50 years. Today they encompass
emergency/medical response departments in addition to traditional fire
suppression/prevention departments, as a result of the changing public need for
these services.
In the Federal highway business,
Section 128 of Title 23 of the United States Code requires public hearings
whenever Federal funds are included in a highway project. But too often,
comments are merely recorded. As stated in the forward to the report Public
Involvement Techniques for Transportation Decision-making (FHWA-PD-96-031),
"Acting in accord with basic democratic principles means that public
involvement is more than simply following legislation and regulations. In a
democratic society, people have opportunities to debate issues, frame
alternative solutions, and affect final decisions in ways that respect the
roles of decisionmakers. Knowledge is the basis of such participation. The
public needs to know details about a plan or project to evaluate its importance
or anticipated costs and benefits. Agency goals reflect community goals.
Through continued interaction with the entire community, agencies build
community support and, more importantly, assure that the public has the
opportunity to help shape the substance of plans and projects."
Opening a Dialogue
Beyond two-way communication, where information is gained
from both sides, lies the realm of true dialogue, where one side makes a point and the other responds
constructively, and where there is, in effect, a conversation. One good example
of dialogue in the highway community is now occurring on the topic of pavement
performance.
|
When a 1995 FHWA survey revealed pavement smoothness to be
motorists' highest priority, several State and Federal initiatives
encouraged contractors to focus on that objective. Here, technicians
test to see how well the contractors responded. |
In late 1995, FHWA sponsored a
national survey of highway users. The survey consisted of an 18-minute
telephone questionnaire with 2,205 interviews completed in the end. The
responses were weighted to reflect U.S. Census Bureau norms for gender, age,
race/ethnicity, education, and census region. The report that came from the
interviews, the National Highway User Survey, looked at the public's
overall satisfaction with various aspects of the highway system. "It is clear
that the top priority for improving the Nation's highways is to focus on the
quality of the roadway surface," FHWA and its consultants concluded. "This is
the factor that will most significantly increase public satisfaction with the
highway system."
Responding to that call for
action, FHWA created a multiagency team in 1997 to develop and market a
national pavement smoothness initiative. Using as models the pioneering
incentive program for asphalt pavement smoothness created by the Arizona
Department of Transportation (ADOT) and a similar program for portland cement
concrete championed by the Kansas Department of Transportation, FHWA strongly
encouraged State DOTs and their contractors to focus on building smoother
pavement surfaces.
|
Boston's "Big Dig" project, part of
which is shown here completed,
encapsulated nearly all the
public's frustrations with major
transportation projects-
construction delays, cost overruns,
traffic tieups, safety concerns-
some of which were revealed in
FHWA's 2005 survey. Today the
project is finished and sends
motorists whizzing on their way
beneath the city. |
The challenge was determining how
to motivate construction contractors to perform above and beyond their normal
levels. This is where the concept of incentives came into play. "Incentives are
great tools because they enable a transportation agency to set a goal for
contractors and, within certain limits, allow the contractor to use its
ingenuity to come up with the means by which to achieve the goal," says FHWA
Senior Pavement Design Engineer Mark Swanlund.
|
Motorists on this
street might settle for
any pavement at all,
let alone smooth
pavement, as they
negotiate an especially
troublesome
work zone. |
This approach is similar to the
way the Federal Government works with automobile manufacturers to ensure
regulatory compliance. Rather than specifying exactly how the car companies
should build their products, the Government sets a number of general standards
to which manufacturers must adhere. For example, Corporate Average Fuel Economy
standards guide the fuel efficiency of a company's products in general,
National Ambient Air Quality Standards govern the volume of air pollution that
companies can emit, and the New Car Assessment Program sets standards for how
well vehicles should handle front-end crashes.
According to Swanlund, encouraging
State DOTs to adopt incentive specifications through the FHWA-sponsored
pavement smoothness initiative was one of many factors that resulted in
significantly improved pavement conditions on the national highway system. The
"response" to the public's call for action was, in effect, the other half of a
conversation between the motoring public and the Nation's transportation
professionals.
Surveys Say . . .
But that was not the end of the conversation. In 2000 FHWA
again brought the driving public into the conversation through a survey and
issued a report the following year. FHWA intentionally modeled the survey on the
1995 instrument to facilitate comparison, study customer satisfaction trends,
and direct future activities based on changes in the public's priorities or on
improvements in public satisfaction with pavement smoothness.
|
A recent widening project on
northwestern Arizona's S.R. 68
featured contractor incentives
/disincentives, a public relations
program, and other features that
helped result in ontime completion
with minimal driver inconvenience. |
The 2000 survey revealed that although
pavement conditions still resonated as a significant concern (21 percent) among
highway users, traffic flow (28 percent) and safety (26 percent) were now more
important priorities.
In 2005 FHWA and its partners
completed a third effort, the Traveler Opinion and Perception Survey. This
latest effort tracks closely with earlier user surveys. The following
"Important Characteristics of an Effective and High Quality Transportation
System" were listed as priorities:
- Highway and roadway safety
- Ability to get where I want to go easily
- Bridge conditions
- Being able to get around as a pedestrian safely and easily
- Pavement conditions
"These results clearly show that
travelers place high value on their ability to get around safely and easily," says
Rebecca Elmore-Yalch, president and CEO of Northwest Research Group, Inc., the
firm that conducted the survey on behalf of FHWA. "These represent the most
important aspects of a high-quality and effective transportation system, and
travelers wish to see this as a continued focus."
By 2005, it seemed, highway users
had relegated pavement conditions to the fifth position on their list of
priorities. The results do not indicate whether the highway community made a
significant enough impact on pavement conditions to have an impact on user
perceptions or whether user priorities simply changed over the previous decade.
A Work Zone Incentive In Arizona
Several highway agencies are using innovative incentives to
encourage contractors to minimize the negative impact of highway construction
on their customers. In Arizona, for example, ADOT kept an eye on customer
service when it developed an
incentive/disincentive approach for a $42 million project in the northwestern
part of the State. The project called for widening 21.7 kilometers (13.5 miles)
of State Route 68 (S.R. 68) from a two-lane rural road into a four-lane divided
highway.
Rather than looking at the job as
simply building a highway from point A to point B, ADOT officials took the time
to understand the customers who use the route. From that, ADOT determined that
this section of S.R. 68 is a major commuter route for people who are employed
by casinos and other entertainment venues across the State line in Laughlin,
NV. But a large number of commercial truckers and vacationers travel the route
as well. Thus, S.R. 68 does not have the morning and afternoon peak traffic
periods typical of other parts of the country. Rather, a steady stream of
traffic generally runs from early morning to late evening, meaning that
construction crews could not simply schedule their work around the traditional
rush hours.
ADOT realized early on that the
construction project, which ultimately lasted almost 2 years, could have been a
major headache for its customers, so agency officials set up what they termed a
traffic management incentive specification. Under the specification, ADOT
established an incentive/disincentive fund of $400,000 to encourage the
design-build contractor to maintain a target travel time through the work zone
during the entire construction schedule. To determine whether the target was
met, the contractor was required to measure the amount of time it took
travelers to go through the work zone. Further, the contractor had to select a
method for collecting the raw data, calculating the average travel times
through the work zone, and then reporting those averages to ADOT. The
specification required that the average travel time not exceed 27 minutes. For
each minute above that time, the contractor would be charged $21.50.
The contractor chose a measuring
system that employed cameras, positioned at both ends of the work zone, to snap
pictures of the license plates of vehicles entering and leaving the work zone.
A central processor then matched photos of the same plates and determined the
elapsed time between when the car entered and left the work zone. At the end of
the project, only $14,857 had been deducted from the $400,000 incentive,
thereby earning the contractor 96 percent of the bonus fund.
Selected Customer-Focused Activities at FHWA
Knowing what needs to be done
and having the tools to do it are two separate things. So how does one move to
a more customer-focused approach, both in personal approaches and
organizationally? FHWA sponsors a number of programs and activities that can
help State and local agencies improve their delivery of quality roadway
projects. They include the following:
National Highway Institute Course. Public Involvement in the Transportation Decision-Making Process
(#142036) is 3-day course that teaches attendees how to identify key decision
points where the public should be involved. Among the topics covered are
selecting and applying specific techniques for sharing information with the
public, identifying and adapting to different cultural sensitivities, and
developing public involvement plans. For more information, visit
www.nhi.fhwa.dot.gov.
Accelerated Construction Technology Transfer (ACTT). ACTT is a program through which State DOTs can gain access
to a team of nationally recognized leaders in an array of disciplines who
conduct a workshop focused on a single highway corridor or project selected by
the host agency. For more information, visit
www.fhwa.dot.gov/construction/accelerated/.
Performance Specifications Strategic Roadmap. FHWA developed this report as a tool to guide the highway
community in developing, implementing, and accepting performance specifications
as viable tools for highway construction. To view the roadmap document, visit
http://www.fhwa.dot.gov/construction/.
Transportation Curriculum Coordination Council (TCCC). The TCCC is a partnership between FHWA, State DOTs, and
the highway transportation industry to support the training of the highway
construction personnel. The council provides a core curriculum of materials and
training available to State and local transportation agencies. For more
information, visit www.nhi.fhwa.dot.gov/tccc/.
|
ADOT had hired a public relations
firm for the project as well. The firm developed public service announcements,
radio media alerts, a Web site, an informational phone number, and a
newsletter, all aimed at keeping the public informed on the status of the
project.
|
Construction of toll plazas,
border crossings such as the
one shown here, and similar
highway-related facilities
can pose special problems to
State DOTs because they
cannot use detours to steer
traffic away. The New York
State Thruway Authority
reduced the resulting
congestion through
application of a performance
disincentive. |
Critics might question whether the
$400,000 incentive might have been better spent building more roadways
elsewhere in the State. "Due to the lack of detour routes for S.R. 68,"
responds Jennifer Livingston, then-resident engineer for ADOT's Kingman
District, "the traffic management incentive/disincentive clause was vital in
minimizing delays to the traveling public, especially for commuters and those
getting to and from medical appointments, government facilities, and other
daily trips."
The case becomes clearer when
individual costs are considered as well. In the 2005 Urban Mobility Report,
the Texas Transportation Institute estimates that, as a national average, being
stuck in a work zone costs each motorist $13.45 per hour in terms of the value
of lost time. Further, each hour a commercial motor carrier sits in a congested
work zone costs the firm $71.05. But in the end, ADOT received a great deal of
positive feedback from the public, both for the agency's outreach related to
construction and for minimizing delays in the work zone.
|
Concentrating manpower, as
shown here, is one way to speed
construction, as contractors are
increasingly urged-even
required-to complete work in
urban and other high-traffic areas
as quickly as possible. |
A Work Zone Disincentive In New York
When congestion delays due to work zones are potentially
significant, some States require contractors to suspend construction entirely
during peak traffic periods. In June 2005, experts from around the country
joined the New York State Thruway Authority (NYSTA) for an intensive, 2-day
workshop focused on a deck replacement project on the Tappan Zee Bridge.
Sponsored by FHWA's Accelerated Construction Technology Transfer (ACTT)
initiative, the workshop helped NYSTA settle on a prefabricated system that
would shorten construction time and improve safety and quality.
NYSTA selected a construction
method using precast concrete slabs, which offered speedy construction and
minimized exposure of workers to traffic. The project involved sawing up and
removing the existing pavement, putting down a bedding material, installing the
slabs, grouting dowels, and then placing the bedding grout. The contractor
installed about 279 square meters (3,000 square feet) of panels in each 8-hour,
offpeak traffic closure.
The toll plaza services more than
125,000 vehicles per day, so any delay in opening it on time could be
disastrous. NYSTA, therefore, devised a performance standard to meet the need:
For every minute past 6 a.m. that the toll plaza was delayed in opening, the
contractor faced a penalty of $1,300, up to a maximum penalty of $250,000 per
day. The installation proved so successful that no penalties were assessed.
When Time Is Of the Essence
The ADOT and NYSTA projects used incentives, an approach
that says to the construction contractor, "Here's the goal you need to reach to
get some bonus money. You figure out the best way of getting there." And, as in
the New York case, if the contractor fails to look for innovations, it might
actually lose money on the project.
Perhaps the most widely used
performance specification is one focused on how quickly a contractor can
complete a project. More and more, agencies are recognizing that the bottom
line construction cost of a project has to include the impact on the driving
public. So the DOTs offer contractors monetary incentives for early completion
with the daily incentive amount based on estimated road-user costs.
A case in point: On January 5, 2002, a
gasoline tanker traveling Interstate 65 (I-65) within the I-20/I-59/I-65
interchange in Birmingham, AL, crashed and burned under a bridge. The fire
caused the steel girders of the main span over southbound I-65 to sag about 3
meters (10 feet), which required closing all northbound and southbound lanes.
Removal of the damaged bridge began as soon as the wreck was cleared, and
northbound traffic was restored the next day. The Alabama Department of
Transportation (ALDOT) estimated costs to road users caused by the southbound closure
at $90,000 per day.
ALDOT designed a new concrete
girder bridge and awarded the contract on January 16. Construction began
January 21. The contract allowed 90 days for completion of the new bridge, with
an incentive/disincentive provision of $25,000 per day. The successful bidder
completed the new bridge in 37 days, earning an extra $1,325,000. The contract
cost, including the incentive payment, was still less than the cost proposed by
the second-place bidder.
"Within 53 days, the damaged
bridge was removed, the design completed, and a new bridge built, demonstrating
intense commitment and cooperation among all parties involved," says FHWA
Alabama Division Administrator Joe Wilkerson, "especially State engineers, the
concrete fabricator, and the contractor that built the new bridge."
|
(Top) On January 5, 2002, a gasoline tanker crashed and burned under a bridge along I-65 in Birmingham, AL. Seen here (bottom), emergency personnel responded immediately, but the fire caused steel girders to sag dangerously and forced the closing of northbound and southbound lanes.
(Bottom) After the crash, the FHWA Alabama Division and ALDOT responded immediately, designing a new bridge and awarding a construction contract within 13 days of the tanker crash. Incentives motivated the contractor to finish the job in little more than a month, and the new bridge, shown here, was opened February 27. |
New Mexico Uses Innovative Incentives
A look at a New Mexico example ties many elements of the
story together. A recent project needed speedy construction, and the New Mexico
Department of Transportation (NMDOT) added its own twist. Reconstruction of the
I-25 and I-40 interchange in Albuquerque required construction or
rehabilitation of 55 bridges and 177 kilometers (110 miles) of roadway. Lacking
viable alternate routes, NMDOT had to complete the project while motorists continued
to use the roadway.
The original interchange was
designed in 1967 to support 40,000 vehicles per day. At the time of its
reconstruction, however, it was severely overutilized, with an estimated
300,000 vehicles daily. Congestion resulted in an average 1.7 crashes per day,
with an economic impact estimated at $12 million annually.
|
This aerial photo from October
2001 shows the Big-I in New
Mexico during construction.
In the lower left corner of the
interchange (in the vicinity of the
concrete mixing tower) is a 6.9-
hectare (17-acre) parcel of land
that the construction contractor
earned as a bonus for completing
the project ahead of schedule. |
In the end, reconstruction
enhanced the level of service and reduced the crash rate on the most heavily
traveled interchange in the State. NMDOT estimates that the new interchange
will benefit the Albuquerque economy by approximately $1 billion over the first
10 years. The public benefits from reduced travel time, enhanced safety, and
environmental improvements.
To minimize disruption to the
community, NMDOT decided to reconstruct the interchange under a single contract
with incentives to keep construction time under 2 years. But with little
funding available for monetary incentives, the agency offered the contractor
innovative incentives, most notably ownership of excess right-of-way if the
project was finished ahead of schedule. NMDOT purchased an 8.5-hectare
(21-acre) parcel that included about 1.6 hectares (4 acres) of required
right-of-way, with the remainder used as a staging area during construction.
Since construction was substantially complete before the contract calendar
date, the contractor received the deed to the remaining 6.9-hectare (17-acre)
parcel. Ultimately, several tracts of land owned by NMDOT and deemed in excess
of future highway needs were transferred to the contractor in lieu of cash
incentives.
To minimize the impact on traffic,
the project team used progressive techniques, such as segmental bridge
construction, and established a traffic surveillance system and incident
response program for the construction area. Through close contact with the
media during the project, NMDOT cultivated public support by apprising
motorists of potential delays. In the end, the incentives and careful
management paid off: The completed interchange opened to traffic in May 2002,
after only 23 months of construction.
Staying Tuned
The need to learn what the public wants has been recognized
for decades. As noted in the FHWA report Moving
America: New Directions, New Opportunities,
published in February 1990, "An understanding of what Americans want from their
transportation system is as important to the formation of transportation policy
as analysis of facts and figures."
|
Construction-related traffic tieups, such as the one shown here near
I-95 in Boca Raton, FL, continue to inconvenience motorists, but
transportation planners are refining incentive clauses and other contract
elements with the goal of reducing disruption levels lower than ever. |
But understanding what the public
wants and needs—whether smoother roads, less interference with traffic by
construction, or something else—is not necessarily the same as attaining the
desired level of performance from U.S. highways. Incentives and disincentives
are an invaluable tool for attaining those levels of response.
Kathleen A. Bergeron is a marketing specialist with
FHWA in Washington, DC. She works on Highways for LIFE, a program with the goal
of dramatically enhancing the quality, safety, and speed of highway
construction in the United States. Prior to joining FHWA, she managed
communications and marketing programs for consulting engineering firms and
transportation agencies at the State and local levels. She holds a bachelor's
degree in journalism from the University of Texas at Austin and a master's
degree in transportation management from San José State University. Bergeron is
accredited by the Public Relations Society of America.
For more information,
contact Kathleen A. Bergeron at 202-366-5508 or kathleen.bergeron@fhwa.dot.gov.
Other Articles in this issue:
The Straight Scoop on SAFETEA-LU
Mileage-Based Road User Charges
Preservation Act
Helping Roadway Contractors Fulfill Public Expectations
Geospatial Technologies Improve Transportation Decisionmaking
The Return of Private Toll Roads
Essential to the National Interest
Multipedestrian Tracking