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The National Academies

NCHRP 08-114 [Active]

Systematic Approach for Determining Construction Contract Time: A Guidebook

  Project Data
Funds: $500,000
Staff Responsibility: Andrew C. Lemer
Research Agency: Texas A&M University
Principal Investigator: David Jeong, Ph. D.
Effective Date: 7/27/2018
Completion Date: 3/27/2020

BACKGROUND
 
Establishing an appropriate contract time is an important step in the transportation project development process.   Contract time affects construction cost, inconvenience for the public, economic impact in areas surrounding the construction project, and schedule risks. Contract time derives from an interaction of project characteristics, construction methodology, technology, and agency policies. Being able to develop credible estimates of contract time is crucial to any transportation agency’s decision making; risk management; and ability to develop, operate, and maintain the transportation system for which they are responsible. In addition, state departments of transportation (DOTs) using federal funds are required by the Federal Highway Administration (FHWA) to adopt a formal procedure for estimating construction project contract time. (Refer for example to Technical Advisory 5080.15, FHWA Guide for Construction Contract Time Determination Procedures, dated 10/15/2002, at https://www.fhwa.dot.gov/construction/contracts/t508015.cfm
 
However, the literature (represented, for example, by a search of the TRB’s integrated TRID database) includes few studies of methods for estimating contract time or the accuracy of such estimates. A survey conducted as part of work reported in NCHRP Synthesis 502: Practices for Establishing Contract Completion Dates for Highway Projects found that 68% of the 41 DOT respondents had formal, documented procedures for estimating project contract time, but over 50% of these respondents did not formally evaluate the quality of their procedures or the reliability of contract-time estimates. Research is needed to provide guidance DOTs can use to produce consistently credible, reliable, and defensible contract-time estimates.
 
OBJECTIVE
 
The objective of this research is to develop a guidebook that DOTs can use to establish and maintain a systematic approach to determining credible and defensible contract times for projects using conventional and alternative contracting methods (e.g., design-bid-build without or with completion incentives and disincentives, design-build, construction-manager/general-contractor (CMGC), and other variations). The guidebook should address at least the following topics:
  • Key factors that influence contract time duration and uncertainty, for example construction production rates, regional conditions, involvement of utilities, project priority or significance, technology advancement, and contracting strategy
  • ·A framework for defining and evaluating the components of contract time, such as construction methods, site conditions, and project scope and complexity
  • Definition and measurement of effectiveness of techniques and processes for contract time determinations
  • Methodologies for making credible and defensible estimates of contract time
  • The relationship of contract time to risk management
  • Strategies for post-project contract-time evaluation and other methods to improve effectiveness of contract time determination
  • Strategies for developing, maintaining, and effectively applying experience and knowledge of contract-time determination throughout the agency
 
RESEARCH PLAN
 
The research entails the following milestones and deliverable products:
  • Interim Report 1 (IR1) presenting a critical review of current leading practices for construction contract time determination.
  • Interim Report 2 (IR2) on (a) the principal components of contract time; (b) a generic framework for contract-time estimation; (c) identification of methodologies for contract-time estimation; (d) a practical definition of contract-time estimation effectiveness and metrics for its measurement; (e) relationship of contract time to risk management; (f) a preliminary annotated outline of guidance for making the framework, methodologies, and metrics operational for DOTs and others; and (g) strategies for post-project contract-time evaluation and other methods to improve accuracy of contract time determination and for developing, maintaining, and effectively applying experience and knowledge of effective contract-time determination throughout an agency.
  • In-person meeting with the NCHRP project panel to discuss IR2 and plans for subsequent project work.
  • Interim Report 3 (IR3) presenting preliminary guidance for DOTs and others on contract-time estimation, assessing the effectiveness of  contract-time estimates, and developing and enhancing agencies’ capabilities for contract-time estimation and (b) a plan for the validation workshop (item 6 below).  NCHRP envisions that the materials to be used in validation will be suitable for training and will become a part of the guidance, to assist DOTs and groups such as AASHTO technical committees to introduce the results of this research into DOT practice.
  • Validation workshop with participants representing a cross section of the potential audience for the guidance, to test the applicability and usability of the guidance, and workshop documentation.
  • Final Report presenting (a) guidance for DOTs on contract time estimation and (b) a summary description of the research conducted in this NCHRP project and underlying the guidance.
STATUS (July 2018)  Research work has been initiated.
 

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