Ensuring Efficient Incentive and Disincentive Values for Highway Construction Projects: A Systematic Approach Balancing Road User, Agency and Contractor Acceleration Costs and Savings
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- Title
- Ensuring Efficient Incentive and Disincentive Values for Highway Construction Projects: A Systematic Approach Balancing Road User, Agency and Contractor Acceleration Costs and Savings
- Authors
- LEE, EUL BUM; Alleman, Douglas
- Date Issued
- 2018-03
- Publisher
- MDPI AG
- Abstract
- United States State Highway Agencies (SHAs) use Incentive/Disincentives (I/D) to minimize negative impacts of construction on the traveling public through construction acceleration. Current I/D practices have the following short-comings: not standardized, over- or under-compensate contractors, lack of auditability result in disincentives that leave SHAs vulnerable to contractor claims and litigation and are based on agency costs/savings rather than contractor acceleration. Presented within this paper is an eleven-step I/D valuation process. The processes incorporate a US-nationwide RUC and agency cost calculation program, CA4PRS and a time-cost tradeoff I/D process. The incentive calculation used is the summation of the contractor acceleration and a reasonable contractor bonus (based on shared agency savings) with an optional reduction of contractor’s own saving from schedule compression (acceleration). The process has a capability to be used both within the US and internationally with minor modifications, relies on historical costs, is simple and is auditable and repeatable. As such, it is a practical tool for optimizing I/D amounts and bridges the gap in existing literature both by its industry applicability, integrating the solution into existing SHA practices and its foundation of contractor acceleration costs.
- URI
- https://oasis.postech.ac.kr/handle/2014.oak/41161
- DOI
- 10.3390/su10030701
- ISSN
- 2071-1050
- Article Type
- Article
- Citation
- Sustainability, vol. 10, no. 3, page. 701, 2018-03
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