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10 Update VE guidelines at least every 10 years: (1979). In most cases, these early VE programs focused on Complete update of 2001guidelines by 2011, the improvement of standards and specifications, and staff Work with the task force on D/B to jointly develop training (1). best practices for VE for D/B by late 2003, and Develop guidelines for VE performance measures FHWA monitors the application of VE on federal-aid proj- by 2005. ects and produces an annual summary report (11). Table 1 Maintain an active website providing information summarizes the results for the 7-year period from 1997 to about transportation VE and the upcoming national VE 2003. This corresponds to the time period that the FHWA VE conference. Regulation has been in force. On average, 382 federal-aid VE Provide ongoing assistance to member states to: studies were performed annually. This represents an increase Comply with the FHWA mandate, of approximately 18% over the annual average number of Develop VE programs, federal-aid VE studies observed from 1993 to 1997. Provide VE training, and Conduct VE studies. For the latest 5-year period, from 1999 to 2003, the 10 most active STAs (Virginia, Florida, California, Texas, Pennsyl- vania, New Jersey, North Carolina, Tennessee, Washington TRANSPORTATION AGENCY INVOLVEMENT State, and Ohio) completed 64% of the total number of VE studies (1,872) performed on federal-aid projects. This is The California Department of Transportation (DOT) (Cal- illustrated in Figure 1. The number of VE studies is presented trans) is acknowledged to have established the first state VE in Figure 2. The average cost per VE study is presented in program. Caltrans initiated its VA program in 1969. Its ini- Table 2. tial focus was on standard specifications, standard plans, and selective elements of highway projects. However, highway The average cost per study, calculated from the FHWA projects were not extensively studied until 1985. Turner and VE program reports for the 10 most active STAs, ranges Reark reported in 1981 that VE had not been generally applied from $2,600 to $60,000. This wide variation in study costs to highway projects "because of tight schedules and the con- likely reflects differences in how costs are attributed to VE cern about designer's reactions" (1, p. 9). studies, size and composition of the VE team, duration of the VE studies, and complexity of the project being reviewed. For The Caltrans VE program served as a beachhead for expan- example, California's relatively higher average cost per study sion into other STAs. In the 1970s, VE programs were initi- takes into account longer study durations--Caltrans typically ated in Florida (1970), Idaho and Virginia (1973), Minnesota uses 6-day workshops instead of 5-day workshops--and (1975), New Mexico (1977), and Oregon and Pennsylvania large study teams assembled for relatively complex projects. TABLE 1 FEDERAL-AID PROGRAM VALUE ENGINEERING SUMMARY, 19972003 VE Program Metrics FY 1997a FY 1998a FY 1999b FY 2000a FY 2001c FY 2002c FY 2003d Total/Avg. No. of VE Studies 369 431 385 388 378 377 344 2,672 Cost of VE Studies $5.10 $6.58 $7.47 $7.78 $7.29 $9.02 $8.45 $51.69 Plus Administrative Costs Estimated $10,093 $17,227 $18,837 $16,240 $18,882 $20,607 $19,241 $121,127 Construction Cost of Projects Studied Total No. of N/A 2,003 2,082 2,017 2,013 2,344 2,144 12,603e Recommendations Total Value of N/A $3,084 $3,227 $3,483 $2,375 $3,050 $3,163 $18,382e Recommendations No. of Approved N/A 743 848 1,057 1,017 969 914 5,548e Recommendations Value of Approved $540 $770 $846 $1,128 $865 $1,043 $1,016 $6,208 Recommendations Return on Investment 106:1 117:1 113:1 145:1 119:1 116:1 120:1 120:1 Source: Annual Federal-Aid Value Engineering Summary Reports (11). Notes: Amounts shown in millions of dollars. N/A = not available. a 52 agencies reported in fiscal year (50 states, District of Columbia, and Puerto Rico). b 53 agencies reported in fiscal year (50 states, District of Columbia, Puerto Rico, and Virgin Islands). c 53 agencies reported in fiscal year (50 states, District of Columbia, Puerto Rico, and FLH). d 50 agencies reported in fiscal year (47 states, District of Columbia, Puerto Rico, and FLH); Kentucky, Louisiana, and New Hampshire did not report results. e Totals do not include results from FY 1997, which were unavailable.

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11 More than 200 Studies 100 to 200 Studies Less than 200 Studies FIGURE 1 Ten most active STAs performing VE studies, 19992003 (11). Also consider that some STAs might use in-house exper- However, in-house costs are typically more difficult to track tise for their studies, whereas other agencies might use exter- because many agencies are generally not able to fully con- nal consultant team leaders and specialists. The total cost of sider the total cost of staff time or to reflect the true value of a person-hour is generally understood to be the aggregate the expertise to the project. cost of salary, benefits, and corporate overhead. Additional project costs, pertaining to other expenses such as printing The FHWA "racing form" (11) is primarily a financial and travel, should also be considered. For consultants, the reporting tool to satisfy the legislation requirements regard- costs associated with external VE study participants are usu- ing VE. The tabular format permits easy comparison between ally readily apparent and traceable because the expertise has two or more STAs in a global sense and likely creates com- been acquired through some form of contractual agreement. petitive interest between agencies. 300 Federal-Aid VE Studies Completed During 1999-2003 250 200 150 256 245 100 141 50 100 93 89 82 66 65 60 0 VA FL CA TX PA NJ NC TN WA OH FIGURE 2 Most federal-aid VE studies by state completed during 19992003 (11).