FDOT STUDY FINDS SIGNIFICANT COST AND TIME SAVINGS WITH DESIGN-BUILD PROJECT DELIVERY
According to a recent internal study conducted by the
Florida Department of Transportation (FDOT), the design-build project delivery
method provides significant cost and time savings as compared to the
traditional design-bid-build delivery method. The study examined FDOT
contracts from 2008 to 2012 that were valued between $30 million and $70
million, a group of contracts that included 11 design-build contracts and
47 design-bid-build contracts. Looking in particular at a $55
million, 814‑day design-build project, the study found that the use of
design-build results in a total cost savings of $6.4 million and a total time
savings of 656 days.
Lowest
Price Not Always Best Value
The study also compares best value selection to low bid
selection to determine what value FDOT and the traveling public receive when
the winning proposal for a project is not the lowest-priced proposal.
Although a design-build firm’s price proposal reflects the price of the design
and construction of the project, the FDOT study finds that this price does not
fully encapsulate the value that FDOT and motorists receive. Often times
a winning design-build firm’s technical proposal includes innovative elements
that provide additional value which should be taken into account.
Secondary
Benefits Often Provide True Value
Between January 2012 and January 2014, FDOT received
proposals for 42 design-build projects. Out of these 42 projects, 31 were
awarded to the proposer with the lowest bid price and lowest technical
score. Eleven of the 42 projects were awarded to design-build firms that
did not provide the lowest-priced proposals. The proposals for these 11
projects often included design features that were better than the minimum
acceptable design. These improved design features were often made
possible by secondary benefits in cost and time savings to the design-build
firm and by the design-build firm’s willingness to take on risks that FDOT
would not typically assume in the design phase of a design-bid-build project
procurement.
The innovative elements of these 11 projects included design
features that provided speedier project delivery, savings on future maintenance
costs, and greater operational safety or service level as compared to the
minimum acceptable design customary in design-bid-build procurements. In
some cases, the proposers provided warranty periods that were longer than what
FDOT already requires or warranties for elements where FDOT does not presently
have warranty requirements at all.
The report of the study contains several examples of
innovative elements from some of the design-build contracts that FDOT has
awarded to firms that did not provide the lowest-priced proposal. These
examples, and the report in full, can be found here.