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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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Suggested Citation:"Appendix C - Research Results." National Academies of Sciences, Engineering, and Medicine. 2010. Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts. Washington, DC: The National Academies Press. doi: 10.17226/14392.
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55 Results for the E-mail Interview Form Types of Time-Related I/D Provisions in Use Complete-by-date and A+B I/D provisions are used by more than 90% of the STAs that responded to the e-mail interview form. Lane rental provisions are used by 59% of the respondents. Incentives and disincentives associated with interim milestones (A+B1+B2+Bn) are used by nearly one- third of the states represented in the data set. Liquidated savings provisions are far less common than the other types of I/D provisions. Figure C.1 illustrates the percentage of states using different types of I/D provisions. These data do not show the frequency at which each type of provision is used; rather they reveal which types of provisions are more widespread among the STAs that responded to the e-mail interview form. One additional type of I/D provision was discovered in the literature search. ADOT used a travel time I/D specification on a design-build project. This provision used the average travel time through the project as the measurement criteria for awarding incentive or assessing disincentive. Plans to Use Time-Related I/D Provisions in the Future The majority of the STAs that responded to the e-mail inter- view form appear to be comfortable with their use of I/D provisions, as 69% of them plan to keep using I/D provisions at about the same frequency as they have in the past. Only two of the STAs indicated that they would not use time-related I/D provisions in the future. Additionally, two more STAs plan to use I/Ds less frequently than they have in the past (Figure C.2). The responses indicate that STAs are heeding FHWA’s suggested guidance that “I/D provisions should not be used routinely.” Factors Used to Determine If I/D Provisions Should Be Used E-mail interview responses show that RUCs are the most important factor considered for determining if a project war- rants the use of an I/D provision. On average, STA respon- dents felt that RUCs were approximately 60% more important than special events, anticipated feedback, and public/political input as a decision making factor in the use of I/D provisions (Figure C.3). A note regarding the graphical presentations of data collected during Phase I: The average of interview responses or ranking values is shown. Each bar in a graph represents the calculated average of the corresponding data set. For example in Figure C.3, respondents were asked to rank the importance of four (4) factors affecting the use of I/D provisions; the average of 32 responses for “User Cost” is 2.2. Some of the graphs also show the upper and lower quartiles as an indication of the variability within the data set. Using Figure C.3 as an example, the lower quartile for “User Cost” is equal to 1.7 and the upper quartile is equal to 3.0; meaning that 25% of the rankings were less than 1.7, 50% of the rankings were between 1.7 and 3.0 and the remaining 25% of the rankings were greater than 3.0. Agency Methods Used for Estimating Contract Duration The primary method used by STAs to estimate project durations is nearly evenly split between historical experience (54%) and critical path method (46%) (Figure C.4). Written comments provided in the e-mail interview forms regarding the primary method used to estimate contract duration include the following: • California—“Although CPMs are utilized during project development to estimate project duration in many cases, it is not standard practice for all projects. In any case, some A P P E N D I X C Research Results

56 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Complete By Date A+B Lane Rental A+B1+B2+Bn Liquidated Savings Figure C.1. Use of I/D provision types by STAs responding to the e-mail Interview form. 0% 10% 20% 30% 40% 50% 60% 70% 80% Will Not Use in The Future Less Frequently About the Same Frequency More Frequently Pe rc en t o f R es po nd en ts Figure C.2. STA plans to use I/D provisions in the future (n  31). 0.0 2.01.0 3.0 4.0 Public/Political Input Anticipated Feedback Special Events User Cost Most ImportantLeast Important Figure C.3. Relative importance of factors affecting the use of I/D provision (n  32).

type of schedule (e.g., bar chart) is prepared during project development.” • Tennessee—“A combination of a less detailed CPM of major items combined with historical experience.” • Minnesota—“We have used CPM on our larger complex projects.” • Texas—“Historical experience and Bar Chart (CPM).” Based on the feedback from the e-mail interview form, STAs are not fully using CPM scheduling techniques. Accuracy of contract duration estimates has a significant impact on the effectiveness of I/D provisions. Implementing CPM schedul- ing entails more than just software training. Construction experience must be integrated with calculating durations and assigning logic. Sequencing schedule activities to avoid conflicts that are inherent in the plans requires a complete understand- ing of highway construction. Contract Time Extensions Almost one-third of the STA respondents indicated that contract time is not subject to adjustment for any reason. Contract time extensions for weather or utilities are allowed by over 40% of the STAs (Figure C.5). This e-mail interview question generated many comments in the “other” category. Some of these comments follow: • California—“Our contracts generally provide for excusable and compensable delays to the contract completion date.” • Virginia—“unknowns not within the contractor’s control” • Michigan—“Fixed completion date with special provision for payment to accelerate but no additional time is allowed.” • Minnesota—“We are going to try a Locked Incentive Date specification based on Florida’s No Excuse Bonus on one of our Metro projects next year.” • North Dakota—“The incentive date is a no-excuse date. We do allow the disincentive date to be moved for certain factors.” The manner in which time extensions are handled has a direct impact on the effectiveness of I/D provisions. This issue is related to what type of I/D provision is used and the specific language of a provision. STAs and contractors both need to understand how different elements or variables of common I/D provision types work together or, in some cases, do not work together. California DOT and NYSDOT have documented compar- isons between time extensions granted on I/D and non-I/D projects. NYSDOT’s experience reveals that approximately 50% of all contracts grant time extensions while 42% of A+B contracts have adjustments to the B time. The most common reasons for time extensions were revisions to bridge related components (25%), utilities and drainage redesign (24%), overrun of pavement repair quantities (17%), added or revised lane closure restrictions (9%), additional pile quantities or revised piling design (6%) and delayed award (5%). California DOT’s results are similar: 48% of A+B projects experienced time growth compared with 43% of non-I/D projects. Cost growth was also examined by NYSDOT and California DOT. When adjusted for two outliers, NYSDOT’s comparison between 98 A+B contracts and 2,636 normal contracts showed the average cost growth of A+B contracts to be within 1⁄2% of the other contracts. Again, California DOT’s results are similar for cost growth. Average cost growth for A+B projects was 24% and non-I/D project average cost growth was 26%. 57 CPM, 46% Historical Experience, 54% Figure C.4. Primary method used to estimate contract duration (n  28). 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Utilities Weather Other None Pe rc en t o f S TA R es po nd en ts Figure C.5. Allowable causes for contract time extensions on I/D projects (n  28).

Incentives Earned Three-fourths of the respondents indicated that I/D projects typically resulted in the contractor earning significant incen- tives. None of the STAs indicated that I/D projects typically resulted in disincentive charges to the contractor nor did they indicate that projects finished late with reduced disincentive charges. This response is further validated by Figure C.6 and the fact that 13 of 17 STAs stated that at least 75% of all I/D projects in their state over the last 2 fiscal years had resulted in the contractor earning the maximum incentive allowed. Budgeting for I/Ds The majority of STAs budget for I/Ds in some manner, with only one-fourth of the responding STAs indicating they do not specifically budget for I/Ds (Figure C.7). This budgeting question also generated some comments worth noting: • California—“Included in estimate as Supplemental Work.” • Michigan—“A determination to use an I/D provision is usually made at the later stages of the design process. Therefore, the cost is usually budgeted for at that time. MDOT is presently in the process of trying to identify these I/D projects during the scoping phase and to include the amount in the original programmed project amount so as to eliminate funding transfers. This will help stabilize our program delivery.” • Delaware—“It’s been overlooked.” • Ontario, Canada—“Budgeting for incentives is inconsistent.” Projects that will include I/D provisions should be iden- tified early in the project development phase. This is not only a best practice with respect to budgeting needs, but it also allows project design to accommodate accelerated construction. I/D Impacts on Quality Based on the perceptions and experiences of the e-mail interview respondents, time-related I/D provisions do not negatively impact the project quality to any great degree. Only 5 of the 32 STAs have experienced quality deficiencies that they attribute to project acceleration from I/D provisions (Figure C.8). MNDOT reports anecdotal evidence from some of its field staff who believed that the quality of work was reduced on A+B and lane rental projects. According to a study performed by the Kentucky Transportation Center, quality is not nega- tively impacted by time-related I/D provisions. This study 58 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% AR MN NV ID NY LA MD CA MO MI PA IA NE DE GA OR RI Figure C.6. Percent of projects earning maximum incentive by state (last 2 fiscal years) (n  17). Included in Original Budget, 61% Non-Project Specific Annual Account, 14% Not Budgeted For, 25% Figure C.7. I/D budgeting (n  28). yes, 16% no, 84% Figure C.8. I/D impacts on quality (n  32).

compared asphalt pavement characteristics for 26 I/D projects and 25 non-I/D projects. Material quality incentives were earned on 80% of the I/D projects while 56% of the non-I/D projects earned a material quality incentive. I/D Impacts on Cost In contrast to the subject of I/D impacts on quality, a large majority of STA respondents believe that I/D provi- sions impact the cost of a project. Over 80% felt that project costs increased as a result of time-related I/D provisions. Of those who indicated that costs were increased, two-thirds felt that the cost increase was less than 10%. The remaining one-third felt that costs were increased from 10% to 25%. The cost impacts of time-related I/D provisions are sum- marized by the following statements and are also illustrated in Figure C.9: • 19% of the STAs felt that cost was not impacted • 55% of the STAs felt that cost increased less than 10% • 26% of the STAs felt that cost increased between 10% and 25% A comparison of contractor bid prices by Strong et al. (16) shows that the average initial bid for A+B projects is 7.5% higher per mile than for non-I/D projects. I/D Impacts on Agency Staffing Impacts on agency human resources during the project development phase appear to be negligible, because only two STAs indicated that this was a concern. However, this is not the case for impacts on agency human resources dur- ing the construction phase of the project. Seventy percent of the respondents feel that agency staff requirements are impacted by time-related I/D provisions. The most common strategies for coping with this impact are represented in Figure C.10. Recommendations for agency staffing issues on I/D projects identified by Petring and Helgeson include the following: • Limit project managers to oversight of one A+B project at a time and avoiding consecutive assignments on A+B projects. • Train project managers regarding limitations on agency personnel work hour limitations. 59 0% 5% 10% 15% 20% 25% 30% 35% 40% No Impact on Staffing Overtime Increased Staffing Consultants Pe rc en t o f S TA R es po nd en ts Figure C.10. Strategies for addressing impacts on agency staffing (n  32). 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% No Impact Less Than 10% 10% to 25% Greater Than 25% Pe rc en t o f S TA R es po nd en ts Figure C.9. I/D provision impacts on cost (n  25).

• Staff A+B projects with a resident engineer and two project managers (day shift and night shift). • Provide team building training. • Empower project personnel to encourage “ownership” of the project. Results of In-Depth Interviews Findings of the in-depth investigations are based on results of the ranking forms that were completed by 42 construction professionals. The purpose of the ranking form is to have some way to quantify the experiences and perceptions of the interviewee experts. In-Depth Investigation Ranking Forms Ranking forms were completed by 42 interviewees. The interviewees are classified into four groups: agency adminis- tration, agency field, contractor administration, and contractor field. The distribution of interviewees is shown in Figure C.11. These on-site in-depth interviews took place in six different states. The experience level with different types of I/D pro- visions varies by group. Interview participants had the most experience with A+B and complete-by-date I/D provisions. The groups had less experience with lane rental, multiple I/D for interim milestones, and liquidated savings I/D provisions. Figure C.12 shows the number of projects by I/D provision type, and interview group. Except for liquidated savings, every group had experience with each I/D provision types identified in the ranking form. The one exception was the contractor field group, which indicated that none of them had actually com- pleted a project under a liquidated savings I/D provision. One section of the ranking form asked interviewees to con- trast projects of similar scope and size that used time-related I/D provisions with non-I/D projects and rate their level of agreement or disagreement with a specific statement. Rankings for these statements were given on a scale from 1 through 5 as shown in Table C.1. This section of the ranking form included 19 statements to rate. The average ranking for all statements was calcu- lated and then sorted in ascending order. An initial analysis of the results looks at the four statements that generated the lowest level of agreement (respondents disagree with the interview statement) and the four statements that resulted in the highest level of agreement. Segregating the average results this way gives an indication of what issues the inter- viewees feel most strongly about, either in agreement or disagreement. Figure C.13 shows the results of this analysis graphically. From Figure C.13, it can be inferred that on average, the interviewees felt most strongly about the following items: 1. The contractor works longer hours on I/D projects. 2. Contractors schedule their work better on I/D projects. 3. Staffing of I/D projects requires experienced personnel. 4. Innovation occurs more often on I/D projects. 5. Safety compromises do not occur more often on I/D projects. 6. Time extensions that impact incentive payments are not granted too often. 7. The quality of the design (plan errors/omissions) is not better on I/D projects. 8. The process of calculating time charges does not favor the contractor more than the agency. This same set of 19 rankings was further analyzed to reveal which four statements had the highest level of relative differ- ence when comparing the rankings of agency personnel with contractor personnel (Figure C.14). 60 agency admin., 11, 26% agency field, 18, 43% contractor admin., 9, 21%contractor field, 4, 10% Figure C.11. Distribution of on-site interviewees by group (n  42).

As shown in Figure C.14, items that had the largest relative difference between average contractor and average agency rankings are provided as follows: 1. Contractors believe that the decision making process regarding contract changes is handled differently on I/D projects, while agency personnel believe that this process is similar for I/D and non-I/D projects. 2. Both agencies and contractors agree that I/D projects require experienced personnel, but the contractors agree at a higher level. 3. Contractors and agencies both agree that innovation occurs more often on I/D projects, but the contractors agree at a higher level. 4. Agencies and contractors also agree that time extensions affecting incentive payments are granted too often, however the agencies agree to a higher level. I/D Provision Impacts on Project Factors In-depth Interviewees were asked to rank the degree to which time-related I/D provisions impact seven different project factors. The project factors considered were construction time, project cost, project quality, safety, innovation, contract admin- istration and project staffing. Nine ranking levels were used in this section of the ranking form (Table C.2). 61 0 1 3 0 2 2 0 0 0 2 1 1 1 2 0 1 4 0 0 01 3 5 3 6 2 3 2 2 4 1 3 1 8 1 2 8 4 4 8 8 1 1 4 4 8 2 7 7 2 2 12 4 1 1 1 1 0 9 3 3 1 4 1 1 3 6 2 2 2 5 8 2 0 1 0 5 10 15 20 25 30 35 0 1 to 5 6 to 1 5 m o re th an 1 5 0 1 to 5 6 to 1 5 m o re th an 1 5 0 1 to 5 6 to 1 5 m o re th an 1 5 0 1 to 5 6 to 1 5 m o re th an 1 5 0 1 to 5 6 to 1 5 m o re th an 1 5 Number of Projects by I/D Provision Type R es po nd en t E xp er ie nc e (# of pr oje cts ) agency admin. agency field contractor admin. contractor field A+B A+B1 +B2 +Bn Complete By Date Lane Rental Liquidated Savings Figure C.12. Interviewees’ experience by I/D type and group (n  42). Ranking Description 1 strongly disagree 2 moderately disagree 3 neutral 4 moderately agree 5 strongly agree Table C.1. Ranking form scale (compare and contrast I/D projects with non-I/D projects).

62 The contractor works longer hours on I/D projects Contractors schedule their work better on I/D projects Staffing of I/D projects requires experienced personnel Innovation occurs more often on I/D projects The process of calculating time charges favors the contractor more than the agency The quality of the design (plan errors/omissions) is better on I/D projects Time extensions that impact incentive payments are granted too often Safety is compromised more often on I/D projects R an ki ng o f I /D Im pa ct s by R es po nd en ts 1 - s tro ng ly di sa gr ee 2 - m od er at el y di sa gr ee 3 - n eu tra l 4 - m od er at el y ag re e 5 - s tro ng ly ag re e The decision making process regarding contract changes on I/D projects is handled in a similar manner to non-I/D projects Staffing of I/D projects requires experienced personnel Time extensions that impact incentive payments are granted too often Innovation occurs more often on I/D projects R an ki ng o f I /D Im pa ct s by R es po nd en ts agency contractor 1 - s tro ng ly di sa gr ee 2 - m od er at el y di sa gr ee 3 - n eu tra l 4 - m od er at el y ag re e 5 - s tro ng ly ag re e Figure C.13. Items with the lowest or highest level of agreement (I/D provision impacts): average and upper and lower quartiles (n  42). Figure C.14. Differences between contractor and agency perceptions: I/D projects contrasted with non-I/D projects (n  42).

Time-Related I/D Provision Impacts on Construction Time On average the rankings from the expert interviewees indicate that time-related I/D provisions have a moderate beneficial impact on construction time (Figure C.15). The contractor field group results were evenly split between ben- eficial impact and detrimental impact. Of the 41 rankings, 37 indicated a beneficial impact, 1 ranked the impact of I/Ds on construction time as neutral, and 3 ranked it as detrimental. Of the 3 detrimental rankings, 2 came from the contractor field group and the other came from the agency field group. Even though there is not a majority among the contractor field group regarding the impact of I/Ds on construction time, there is an overwhelming consensus from the other groups that time-related I/Ds are beneficial at reducing construction durations. Time-Related I/D Provision Impacts on Project Cost Based on the rankings of 41 construction professionals having considerable experience with time-related I/D provi- sions, the impact on project cost is negligible (Figure C.16). Time-Related I/D Provision Impacts on Project Quality Overall rankings reveal that project quality is unaffected by I/Ds (Figure C.17). However, the contractor field group had a majority that ranked I/D impacts on project quality as slightly detrimental. One probable explanation for the difference between this group’s ranking and the other group’s is the manner in which quality is defined. Agency and contractor administration personnel measure quality almost exclusively from a specification perspective; however, contractor field personnel have a personal connection to the construction 63 Rank I/D Degree of Impact on Project Factors 5 significant beneficial impact 4 considerable beneficial impact 3 moderate beneficial impact 2 slight beneficial impact 1 or -1 neutral impact -2 slight detrimental impact -3 moderate detrimental impact -4 considerable detrimental impact -5 significant detrimental impact Table C.2. Ranking levels for I/D impacts on project factors. all contractor field contractor admin. agency field agency admin. - 5 - si gn ifi ca nt d et rim en ta l i m pa ct - 4 - co n si de ra bl e de tri m en ta l i m pa ct - 3 - m o de ra te d et rim en ta l i m pa ct - 2 - sl ig ht d et rim en ta l i m pa ct 5 - s ig ni fic an t b en ef ic ia l i m pa ct 4 - c on si de ra bl e be ne fic ia l i m pa ct 3 - m od er at e be ne fic ia l i m pa ct 2 - s lig ht b en ef ic ia l i m pa ctNeutral Figure C.15. I/D impact on construction time: average and upper and lower quartiles (n  41).

64 all contractor field contractor admin. agency field agency admin. - 5 - si gn ifi ca nt d et rim en ta l i m pa ct - 4 - co n si de ra bl e de tri m en ta l i m pa ct - 3 - m o de ra te d et rim en ta l i m pa ct - 2 - sl ig ht d et rim en ta l i m pa ct 5 - s ig ni fic an t b en ef ic ia l i m pa ct 4 - c on si de ra bl e be ne fic ia l i m pa ct 3 - m od er at e be ne fic ia l i m pa ct 2 - s lig ht b en ef ic ia l i m pa ctNeutral Figure C.16. I/D impact on project cost: average and upper and lower quartiles (n  41). all contractor field contractor admin. agency admin. agency field - 5 - si gn ifi ca nt d et rim en ta l i m pa ct - 4 - co n si de ra bl e de tri m en ta l i m pa ct - 3 - m o de ra te d et rim en ta l i m pa ct - 2 - sl ig ht d et rim en ta l i m pa ct 5 - s ig ni fic an t b en ef ic ia l i m pa ct 4 - c on si de ra bl e be ne fic ia l i m pa ct 3 - m od er at e be ne fic ia l i m pa ct 2 - s lig ht b en ef ic ia l i m pa ctNeutral Figure C.17. I/D impacts on project quality: average and upper and lower quartiles (n  41).

project. Their reputation is attached to that project. There are perceived levels of quality beyond a specified pass or fail level. Contractor field personnel are intimately aware of all the hidden blemishes on a project that go unnoticed by the untrained eye. Even though these blemishes meet or exceed specification, the contractor field group may perceive that time-related I/Ds increase the frequency of these aesthetic or less than perfect project features. Time-Related I/D Provision Impacts on Safety According to the average ranking, safety is not compromised to a measurable degree by I/Ds (Figure C.18). Although all four contractor field responses were technically on the detri- mental side of the scale, the difference between neutral on the detrimental side of the scale and neutral on the beneficial side of the scale cannot be discerned. In hindsight, it would have been preferable to designate zero as the only choice for ranking an I/D impact as neutral. A review of the ranking data of all 41 responses shows that the median and mode ranking values are both equal to one. A publication from 1987 on I/D contracting reported an eight-fold increase in work-related accidents compared with a non-I/D project. However, the fact that I/D provision use has continued and grown suggests that accident rates of this magnitude are not the norm. Time-Related I/D Provision Impacts on Innovation All interview groups concur that I/Ds impact innovation in a beneficial manner (Figure C.19). The contractor adminis- tration group views the impact as slightly beneficial, and the contractor field group ranks the impact as considerable. On average the impact of time-related I/D provisions on innova- tion is moderately beneficial. Time-Related I/D Provision Impacts on Contract Administration The average ranking of the interview groups indicates that I/Ds do not affect contract administration in any appreciable way (Figure C.20). However, this is another area where the contractor field group ranked the impact differently than the other groups. Based on feedback that was received during the Q&A interview sessions, it is likely that the contractor field group identifies the agencies prompt resolution of issues on I/D projects as a beneficial impact with respect to contract administration. Time-Related I/D Provision Impacts on Project Staffing Contractor administration and field group rankings indi- cate that these groups perceive a slight to moderate beneficial 65 all contractor field contractor admin. agency admin. agency field - 5 - si gn ifi ca nt d et rim en ta l i m pa ct - 4 - co n si de ra bl e de tri m en ta l i m pa ct - 3 - m o de ra te d et rim en ta l i m pa ct - 2 - sl ig ht d et rim en ta l i m pa ct 5 - s ig ni fic an t b en ef ic ia l i m pa ct 4 - c on si de ra bl e be ne fic ia l i m pa ct 3 - m od er at e be ne fic ia l i m pa ct 2 - s lig ht b en ef ic ia l i m pa ctNeutral Figure C.18. I/D impacts on safety: average and upper and lower quartiles (n  41).

66 all contractor field contractor admin. agency admin. agency field - 5 - si gn ifi ca nt d et rim en ta l i m pa ct - 4 - co n si de ra bl e de tri m en ta l i m pa ct - 3 - m o de ra te d et rim en ta l i m pa ct - 2 - sl ig ht d et rim en ta l i m pa ct 5 - s ig ni fic an t b en ef ic ia l i m pa ct 4 - c on si de ra bl e be ne fic ia l i m pa ct 3 - m od er at e be ne fic ia l i m pa ct 2 - s lig ht b en ef ic ia l i m pa ctNeutral Figure C.19. I/D impacts on innovation: average and upper and lower quartiles (n  41). all contractor field contractor admin. agency admin. agency field - 5 - si gn ifi ca nt d et rim en ta l i m pa ct - 4 - co n si de ra bl e de tri m en ta l i m pa ct - 3 - m o de ra te d et rim en ta l i m pa ct - 2 - sl ig ht d et rim en ta l i m pa ct 5 - s ig ni fic an t b en ef ic ia l i m pa ct 4 - c on si de ra bl e be ne fic ia l i m pa ct 3 - m od er at e be ne fic ia l i m pa ct 2 - s lig ht b en ef ic ia l i m pa ctNeutral Figure C.20. I/D impacts on contract administration: average and upper and lower quartiles (n  41).

impact on project staffing (Figure C.21). This is in contrast to the agency groups, which perceived a neutral impact on project staffing. Based on the notes from in-depth Q&A sessions and the research team’s experience, this difference between the contractor and agency perceptions is a factor of (1) contractors placing their most experienced people on the jobs where there is higher exposure to risk and (2) the agencies not having the same flexibility in shifting personnel assignments. Overall Effectiveness of I/D Provisions by Type In the last section of the in-depth ranking form, the interviewees were asked to rate the different types of I/D provisions with respect to their effectiveness at reducing con- struction time (Figure C.22). The scale ranged from 1 (highly ineffective) through 5 (highly effective). According to the in-depth interviewee’s experiences, A+B with multiple mile- stones (A+B1+B2+Bn) is the most effective at reducing con- struction time. A+B, complete-by-date and liquidated savings I/D provisions are also considered effective at accelerating construction. Lane Rental provisions were not deemed effective for reducing construction time. 67 all contractor field contractor admin. agency admin. agency field - 5 - si gn ifi ca nt d et rim en ta l i m pa ct - 4 - co n si de ra bl e de tri m en ta l i m pa ct - 3 - m o de ra te d et rim en ta l i m pa ct - 2 - sl ig ht d et rim en ta l i m pa ct 5 - s ig ni fic an t b en ef ic ia l i m pa ct 4 - c on si de ra bl e be ne fic ia l i m pa ct 3 - m od er at e be ne fic ia l i m pa ct 2 - s lig ht b en ef ic ia l i m pa ctNeutral Figure C.21. I/D impacts on project staffing: average and upper and lower quartiles (n  41). A+B1+B2+Bn A+B Complete-By-Date Liquidated Savings Lane Rental 1 - h ig hl y in ef fe ct iv e 2 - i ne ffe ct iv e 3 - n eu tra l 4 - e ffe ct iv e 5 - h ig hl y ef fe ct iv e Figure C.22. Effectiveness of I/D provision types for reducing construction time: average and upper and lower quartiles (n  42).

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Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts Get This Book
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 Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts
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TRB’s National Cooperative Highway Research Program (NCHRP) Report 652: Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts explores best practices of time-related incentive and disincentive contract provisions and their effect on staffing levels, productivity, project cost, quality, contract administration, and the contractor’s operations and innovations. The report also examines a decision process guide as a potential template for crafting the incentive and disincentive provisions in a highway construction contract.

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