Highway Construction Cost Research Articles

Developing a Chained Fisher Construction Cost Index for a State Highway Agency

Construction cost indexes (CCI) are important to state highway agencies (SHA) to provide an indicator of construction cost escalation over time and to update old bid cost information to current year pricing. The Federal Highway Administration publishes a National Highway Construction Cost Index (NHCCI) based upon cost data from several states for SHA to use. The Wisconsin Department of Transportation (DOT) uses a CCI to measure the changes in purchasing power of their construction dollar from one year to the next. Currently, the Wisconsin DOT uses a fixed-weight index to compute the CCI for a fixed basket of seven construction items. However, the current Wisconsin DOT CCI is subject to considerable short-term variation and does not accurately reflect the project bid costs that the department is experiencing. This paper presents results of a study requested by the Wisconsin DOT to develop an approach for calculating a more representative, reliable, and objective CCI. The paper presents various approaches to calculating a CCI, highlighting their properties and characteristics. The paper also outlines the process used to select a representative basket of items to calculate the index and outlines the data preparation steps needed to improve data quality. The recommended methodology uses a chained, two-stage aggregation computation process. This paper compares the newly constructed Wisconsin DOT CCI to the old CCI as well as to the NHCCI. The impact from selecting different size baskets of items is also investigated; it is concluded that a basket containing a representative number of items is sufficient to calculate a reliable CCI.

Highway Construction Cost Forecasting Using Vector Error Correction Models

AbstractHighway construction costs are subject to significant variations over time. These fluctuations are apparent in trends of indices, such as the national highway construction cost index (NHCCI). These variations are problematic for highway contractors because they can result in bid loss or profit loss. They are also problematic for owner organizations, such as State Departments of Transportation (State DOTs), because they can result in hidden price contingencies, delayed or cancelled projects, inconsistency in budgets, and unsteady flow of projects. These problems can be prevented if highway construction costs are forecasted accurately. Existing literature lacks appropriate models to accurately forecast NHCCI. The objective of this research is to identify the leading indicators of NHCCI (i.e., the explanatory variables of NHCCI that are useful to predict NHCCI), and create appropriate multivariate time series models for forecasting NHCCI through utilizing information available from the identified lea...

U.S. highway public private partnerships

Purpose – The use of public-private partnerships (P3s) for infrastructure delivery, particularly for highway projects, has been increasing in the USA. The purpose of this paper is to empirically evaluate the difference of P3s and non-P3 highway projects, in terms of their costs and efficiency. Design/methodology/approach – An empirical model of highway construction costs was estimated using a linear regression model that explicitly accounts for the cost differential between the contracts. The differences between efficiencies was also evaluated through a two-stage analysis, where projects’-specific technical efficiencies were first estimated using stochastic frontier analysis and data envelopment analysis, and then the difference in technical efficiencies between the two groups were evaluated through non-parametric tests of means. Findings – Controlling for various project characteristics, the P3 highway projects in the USA showed higher initial costs than non-P3 projects. However, the efficiency scores showed no significant difference between the two groups. This inconsistency between initial costs and technical efficiency scores suggests the complexity involved in P3 projects, which are not captured in the efficiency analysis. Research limitations/implications – Limited availability of P3 project data due to their immaturity (in cases of P3 projects that include operation and management) and their complex engineering specifications may have caused biased results. Importantly, the study analyzed project costs as of financial close; post-financial close variations, such as change orders during construction, cost/schedule overruns, and renegotiation of contract terms, are beyond the scope of the analysis in this study. Originality/value – The present study contributes to the literature as one of the earliest empirical analyses of the performance of highway P3s in the USA. Also, this is one of the first studies to employ frontier analysis methods that focus on the efficiency of highway project delivery.

Research on Influencing Factors Model of Highway Engineering Cost Based on Pathway Analysis

For the relative lack study of quantitative analysis of influencing factors of highway construction cost, this paper selects influencing factors through the horizontal comparison based on the data of section two of the north seaside avenue, south extension of seaside avenue and Nangang expressway, then selects pathway analysis to construct the project cost analysis model. This paper can quantity the direct effects and indirect effects from the microscopic perspective of characteristics and influencing factors of the project cost and quantitatively describe the direct effects and indirect effects that have impact on the engineering cost in order to better control the highway project cost for construction projects.

Highway Construction Cost Estimation Based on Improved BP Neural Network Model

Highway Construction Cost Estimation Based on Improved BP Neural Network Model

Comparison of Public–Private Partnerships and Traditional Procurement Methods in North American Highway Construction

The number of public–private partnership (P3) projects in North America has increased significantly since the early 1990s, as policy makers and transportation officials seek alternative methods to supplement traditional funding sources to finance and deliver projects. Scholars have compared the cost and schedule overruns of P3 projects against publicly funded projects in mature P3 markets in Europe, but not in the North American market. This paper begins filling that gap by comparing the cost- and schedule-overrun results of 12 completed large-scale (greater than ~US$90 million) P3 highway projects in North America with previous research studies reporting on large-scale design–bid–build (DBB) or design–build (DB) highway projects. P3 project performance data were collected through interviews with project executives, and then findings were used from previous studies of traditional projects for comparative benchmarking data. Research results indicate that the P3 sample cost overruns averaged 0.81% and schedule overruns averaged 20.30%, compared with 1.49% cost overruns and 11.04% schedule overruns for DB projects and 12.71% cost overruns and 4.34% schedule overruns for publicly financed large-scale DBB highway projects. With a relatively small universe of completed construction phase efforts to examine, it is premature to draw explicit conclusions, yet results reported in this study point to tighter control of highway construction costs and delivery schedules when projects are delivered by the P3 method. Findings from this study provide empirical evidence for various theoretical advantages and limitations of P3 projects, as well as serve as a reference tool to compare the appropriateness of different project delivery methods.

A Gene Expression Programming Algorithm for Highway Construction Cost Prediction Problems

The gene expression programming as the new artificially intelligent and mathematic modelling method has very strong function discovery ability and high search efficiency. In view of characteristic of the highway construction cost forecasting and insufficiency of the existing forecasting model, highway construction cost forecasting model is constructed based on the GEP. Then, 11 highway engineering characteristic factors are determined according to the composition of building cost of projects. 15 groups of highway engineering data make the training sample and the confirmation sample. In the premise of configured the constitute elements of GEP algorithm, it is expressed by the Visual Basic program to solve the highway engineering construction cost forecasting model. The sensitive analysis demonstrates the model's feasibility, and the comparison chart and four target value evaluate the model. The result indicates the trend is consistent with the project practice, the predicted value and the actual value's relative error ≤5.9%, satisfies the forecasting precision (≤10%) and the forecasting precision is high, this model has the application value.

Louisiana Highway Construction Cost Trend after Hurricanes Katrina and Rita

The objective of this study was to reveal the trend in highway construction costs following Hurricanes Katrina and Rita in Louisiana. The means of measuring highway construction cost was the Louisiana Highway Construction Index, an index made up of the cost of labor, equipment, and six major materials used in highway construction. Data from projects let by the Louisiana Department of Transportation and Development from the second quarter of 2003 to the second quarter of 2007 were used to track the change in construction costs. Index values from hurricane-impacted areas (GO Zones) were compared with those in Non-GO Zones. The indices revealed that two quarters after Hurricanes Katrina and Rita, the highway construction cost jumped about 20% statewide and 51% in GO Zone. Two years after the hurricanes, the cost has stabilized to around 30% increase over the pre-Katrina and Rita period. This study provides valuable information for the state agency to estimate cost escalation in ongoing projects and to estima...

Establishing highway horizontal alignment to maximize design consistency

Highway design consistency is one of the important criteria in selecting the geometric features of proposed or existing alignments of two-lane rural highways. Operating-speed (OS) profile models have been used to evaluate design consistency by trial and error. For a proposed new highway, however, there may be geometric and physical constraints, and selection of these elements by trial and error to achieve optimal design consistency would be difficult, if not impossible. This paper presents an optimization model that establishes highway horizontal alignment to achieve maximum design consistency based on the OS profile. The decision variables of the model include radius of horizontal curves, spiral curve lengths, length of speed-change (SC) segments, and acceleration and deceleration rates. The objective function of the model minimizes the mean OS difference or the maximum OS difference for successive geometric features along the highway section. Application examples and sensitivity analysis are presented to illustrate the capabilities of the model in evaluating improvement strategies and to ensure that the model produces sound optimum alignments. The proposed model, which complements existing optimization models that mainly address highway construction cost, should be of interest to highway practitioners and engineers.Key words: design consistency, highway, geometric, horizontal alignment, optimization modeling, speed profile.

FUNCTIONAL MODEL OF COST AND TIME FOR HIGHWAY CONSTRUCTION PROJECTS

It is commonly accepted that construction cost, time and quality performance has been regarded as the major success factors for a construction project. With the increasing use of innovative contracts in highway construction, the relationship between construction cost and time has become more crucial than ever. Improved control of time value has become necessary, for quantifying the functional relationship between construction cost and time. This study explores the functional relationship between highway construction cost and time. Data from projects of the Florida Department of Transportation (FDOT) in the US is utilized to develop and illustrate the quantifying model. The proposed model provides State Highway Agencies (SHAs) and contractors with increased control and understanding regarding the time value of highway construction projects.

Neural Network Modeling of Highway Construction Costs

The objective of this research was to develop a procedure that estimates the escalation of highway construction costs over time. An artificial neural network model was developed which relates overall highway construction costs, described in terms of a highway construction cost index, to the cost of construction material, labor, and equipment, the characteristics of the contract and the contracting environment prevailing at the time the contract was let. Results demonstrate that the model is able to replicate past highway construction cost trends in Louisiana with reasonable accuracy. Future construction input costs are estimated from commercially available forecasts of indicator variables closely associated with the price of construction labor, construction equipment, and a representative set of highway construction materials. Future contract characteristics and the contracting environment that is likely to exist in the future are estimated from past trends or stipulated to be consistent with policy decisions in the future. The predictions produced by the model estimate that highway construction costs in Louisiana will double between 1998 and 2015.

Data acquisition and analysis for highway construction using geographic information systems

Earthmoving operations represent a sizeable percentage of highway construction costs. Accurate estimation of cut and fill quantities, as well as haul distances, are thus essential for developing realistic schedules and reliable cost estimates for highway construction projects. This paper presents a model designed to aid highway construction personnel in optimizing earthmoving operations by developing realistic mass haul diagrams. The model automates data acquisition and accounts for the presence of different soil strata and natural and (or) man-made obstructions affecting earthmoving plans. Geographic information systems (GIS) are employed to generate three-dimensional digital terrain models of the topography and soil profiles. The model is supported by a relational database for soil data and has been implemented in a prototype software developed in ArcView® environment. It provides a user-friendly interface to facilitate data entry and efficient reporting capabilities. The model has flexible input and output formats designed to facilitate data sharing with a number of commercially available software systems. A numerical example is presented to demonstrate the features of the developed model.Key words: data acquisition, geographic information systems, quantity estimating, earthwork optimization.

Estimating Future Highway Construction Costs

The objective of this research was to develop a model that estimates future highway construction costs in Louisiana. The model describes overall highway construction cost in terms of a highway construction cost index. The index is a composite measure of the cost of construction labor, materials, and equipment; the characteristics of contracts; and the environment in which contracts are let. Future construction costs are described in terms of predicted index values based on forecasts of the price of construction labor, materials, and equipment and the expected contract characteristics and contract environments. The contract characteristics and contract environments that are under the control of highway agency officials, can be manipulated to reflect future cost-cutting policies. Application of the model in forecasting to highway construction costs in Louisiana shows that the model closely replicates past construction costs for the period 19841997. When applied to forecasting future highway construction costs, the model predicts that highway construction costs in Louisiana will double between 1998 and 2015. Applying cost-cutting policies and assuming input costs are 20% less than anticipated, the model estimates highway construction costs will increase by 75% between 1998 and 2015.

Probabilistic analysis of factors affecting highway construction costs: a belief network approach

This paper presents the application of belief networks to make inferences in highway construction costs. The methodology is evolving; it works very well when sufficient information and incomplete quantitative data are available. It is an attempt to identify the extent of influence of selected variables on highway construction costs. Belief networks are an expressive graphical language for representing uncertain knowledge about causal and associational relations among construction cost variables. This then provides a graphical representation of probabilistic construction cost models. The graph-theoretic framework of the belief lends itself for modeling probabilistic dependence and flow information between different construction costs and related variables in overall highway construction cost determination.Key words: construction costs, belief networks, graphical models, uncertainty, and Bayesian network.

Assessing Public Benefits of Reusing Waste Materials in Highway Projects: A Framework and Decision-Support Tool

The State of Minnesota frequently receives requests from outside sources regarding the acceptance of waste materials for reuse in highway construction and maintenance projects. These waste materials can include glass, roofing shingle tabs, shredded tires, coal ash, railroad ties, and taconite tailings. The Minnesota Department of Transportation (MnDOT) recently established a policy requiring the use of such materials if they have both short- and long-term public benefits. MnDOT sought a framework to assess these benefits. A decision framework and decision-support tool—in the form of an electronic spreadsheet—were developed, tested, and refined through the application of three case studies. The framework and the spreadsheet decision-support tool are described, and results are presented from one of the case studies. This information illustrates the types of input the spreadsheet requires and the output it produces. The spreadsheet is a flexible tool that accounts for a variety of materials and their placement in highways. It compares ( a) the discounted present value over a 20-year period of incremental increases in highway construction and maintenance costs as a result of using broken glass in roads with ( b) the avoidable costs of disposal by transporting the waste and landfilling it or disposing of it at the source—that is, where the waste material is generated.

Highway construction and maintenance costs

This paper gives details of the results of research on maintenance management practices and expenditures on road infrastructure in the province of New Brunswick during the period 1965-1994. An analysis of historic levels of spending on road maintenance, rehabilitation and new construction; current maintenance management practice; and the source and allocation of funds indicated three trends: (i) routine and preventive maintenance funding has steadily decreased over the past 30 years while traffic and vehicle registrations have increased; (ii) maintenance expenditures are not keeping pace with system needs; and (iii) there is a need for a review of traditional construction and maintenance management practices. Three cost prediction models were developed to determine an accurate cost for road maintenance. Based on the models and the management review, it was concluded that maintenance funding needs to be increased by 25% in conjunction with the implementation of a comprehensive maintenance management system, if the Department of Transportation is to adequately meet the current and future needs of the existing road network.Key words: road maintenance, maintenance management, road construction.

Highway construction and maintenance costs

Highway construction and maintenance costs

Regularization Neural Network for Construction Cost Estimation

Estimation of the cost of a construction project is an important task in the management of construction projects. The quality of construction management depends on accurate estimation of the construction cost. Highway construction costs are very noisy and the noise is the result of many unpredictable factors. In this paper, a regularization neural network is formulated and a neural network architecture is presented for estimation of the cost of construction projects. The model is applied to estimate the cost of reinforced-concrete pavements as an example. The new computational model is based on a solid mathematical foundation making the cost estimation consistently more reliable and predictable. Further, the result of estimation from the regularization neural network depends only on the training examples. It does not depend on the architecture of the neural network, the learning parameters, and the number of iterations required for training the system. Moreover, the problem of noise in the data is taken into account in a rational manner.

Long‐Range Forecasting Highway Construction Costs

In the process of decision making for design and execution of highway construction projects, long‐range cost forecasting is one of the most significant and complicated problems. This paper describes the development of a model that enables the user to make long‐range cost projections, taking into consideration general characteristics of the highway construction industry, as well as pertinent local conditions. The model presented uses conventional statistical methods to represent the main categories of typical jobs in the highway construction industry. From these categories, a composite model is created by assigning different weights to the input elements costs and then choosing a series of indicators to predict price trends for each separate element of the composite model. Use of this model reveals that bid volume in a certain area is a factor that has significant influence upon cost forecasts. This paper is accompanied by a case study based on actual data from highway construction projects performed for t...

The impact of inflation upon U.S. highway maintenance and construction costs

Over the past ten years, per mile costs for highway maintenance and construction have risen much faster than general wholesale and retail prices in the U.S. economy. This paper examines historical data on highway maintenance costs, highway construction costs, and general wholesale prices in order to help explain the disproportionate impact of inflation upon highway costs and to project future highway costs increases through 1985. Time-series regressions are used to model highway costs increases as functions of cost increases in the general wholesale sector. Results indicate that construction costs respond quickly to economic changes, with average cost increases 1 1 2 times the general inflation rate. In contrast, maintenance costs tend to be more stable over time and respond slowly to inflationary pressures. These differences can be attributed to differences in the contractual procedures which state and local governments use to supply maintenance and construction. Finally, an examination of highway expenditure increases legislated by the Surface Transportation Assistance Act of 1978 indicates that they are insufficient to compensate for expected cost increases.