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52 GLOSSARY OF TERMS, ABBREVIATIONS, AND ACRONYMS The majority of the definitions listed here were taken from NCHRP Report 703: Guide for Pavement-Type Selection (Hallin et al. 2011). Activity: A specific action performed by the highway agency or the contractor, such as initial construction or major rehabilitation. An activity is defined by its physical costs, its service life, and its effects on highway users. An activity is a component of an alternative. Administrative costs: Costs incurred in contract management administration overhead expenses. Agency: A government organization responsible for initiating and carrying forward a highway program for the general public. May refer to a federal highway agency, state transportation department, metropolitan planning organization, local govern- ment organization, and so forth. Agency costs: Monies spent by a highway agency for construction or rehabilitation activities. Alternative contracting: Type of contract that is executed in ways other than traditional design-bid-build type. Alternatives: The complete set of initial and future activities that will satisfy the established pavement performance objec- tives of a project. In pavement-type selection, all alternatives being considered for a single project will equally meet the projectâs performance requirements. Analysis period: The time period used for comparing pavement-type alternatives. An analysis period may contain several maintenance and rehabilitation activities during the life cycle of the pavement being evaluated. The analysis period should not be confused with the pavement design or service life. Award of contract: The acceptance of a contractorâs bid proposal by the agency. Bidder: An individual, partnership, firm, or corporation formally submitting a proposal for the advertised work or materials. Commodity price adjustment: Adjustments made by the public agency to the contract unit prices of specific materials and supplies under conditions of price volatility. Competitive bidding: The process in which the procuring agency is required to advertise and award contracts to the lowest responsible and responsive bidder through open bidding, unless the use of the agencyâs own labor forces and equipment is more cost-effective. Contractor: Private entity that provides design, construction, and/or maintenance services to a highway agency. May refer to the design-builder or a concessionaire. Corrective maintenance: Activity performed to correct deficiencies that negatively impact the safe, efficient operations of the facility, and future integrity of the pavement section. Corrective maintenance generally is reactive to unforeseen condi- tions to restore a pavement to an acceptable level of service. Correlation analysis: A statistical technique that is used to study the relationship among variables. Cost-based estimating: A method to estimate the bid cost of a work item by estimating the cost of resources (time, equip- ment, labor, and materials) for each component task necessary to complete the work item, and then adding a reasonable amount for contractorâs overhead and profit. Depreciation: Loss in the value of an asset. Design-bid-build: A project delivery method in which the public agency provides the design and solicits bids for the con- struction of the specified design.
53 Design-build: A project delivery method in which the public agency combines procurement for both design and construction services into a single contract and from the same private-sector entity. Design life: The length of time for which a pavement structure is being designed based on structural distresses and traffic loadings. Deterministic analysis: Approach that uses single-point estimates in calculations without regard for the variability of the inputs. The single-point estimates usually are selected based on statistical averages, the most likely scenario, historical evi- dence, or professional experience. Discount rate: The time value of money used as the means of comparing the alternative uses for funds by reducing the future expected costs or benefits to present-day terms. Discount rates are used to reduce various costs or benefits to their present value or to uniform annual costs so that the economics of the various alternatives can be compared (approximately equal to interest minus inflation). Economic analysis technique: The approach used in the planning process to analyze the relative costs and benefits of a potential investment. The most common economic analysis techniques include net present value (NPV), benefit/cost ratios, internal rate of return, modified internal rate of return, and equivalent uniform annual costs (EUAC). End-result specification: A type of specification in which the agency specifies the final characteristics of the product and provides flexibility to the contractor in achieving it. Engineering costs: Costs incurred with design of pavement alternatives, construction engineering, construction supervision, materials testing, and pavement analysis. Equivalent alternatives: Pavement types that are designed to perform equally, provide the same level of service, over the same performance period, and have similar LCCs. Expenditure-stream diagram: The graphical depiction of expenditures over time associated with various activities in a pavement life cycle. The upward arrows indicate expenditures, whereas the downward arrows indicate benefits. Functional classification: The process by which highways and streets are grouped into classes, or systems, according to the type of service they are intended to provide. Functional performance: Ability of the pavement to provide a smooth, comfortable, and safe ride to the road user, as mea- sured by smoothness. Functional treatments: Activity to extend the functional performance of an in-service pavement. Historical bid-based estimating: A method of estimating current unit prices using historical bid data of similar projects from recently awarded contracts. Incentive/disincentive: Pay adjustments awarded to the contractor as reward/penalty based on the quality or performance of the finished product. International Roughness Index: A pavement roughness index computed from a longitudinal profile measurement using a quarter-car simulation at a simulation speed of 50 mph (80 km/h). Life-cycle cost: The total cost of ownership of a pavement section computed over the analysis period. Life-cycle cost adjustment factor: The difference in future costs of two pavement alternatives. Life-cycle cost analysis: An economic assessment of an item, area, system, or facility and competing design alternatives considering all significant costs of ownership over the economic life, expressed in equivalent dollars. Maintenance: The preservation of the entire roadway, including surface, shoulders, roadsides, structures, and such traffic control devices as are necessary for its safe and efficient utilization.
54 Maintenance treatments: Treatment activities intended to correct or preserve a roadway pavement for its safe and efficient utilization. Mechanisticâempirical: A design approach that incorporates the principles of mechanics of solids with empirically derived performance relationships to accomplish the design objectives. Monte Carlo Simulation: A computational algorithm based on repeated random sampling that often is used in simulating a distribution of likely results. Net present value: The net value of all present and future costs and benefits converted to a single point in time using a dis- count rate factor. Pavement condition: A quantitative representation of pavement distress at a given point in time. Pavement life-cycle model: A combination of strategies to achieve the desired functional and structural performance level of the pavement over the chosen analysis period. Strategies include the initial construction, structural and functional rehabilita- tion, preventive maintenance, and corrective maintenance activities. Performance specifications: A type of specification that defines the performance characteristics of the final product and links them to construction, materials, and other items under contractor control. Performance-trend analysis: Statistical analysis to determine the longevity of a pavement structure or a rehabilitation strat- egy using historical data. Performance warranty: A contract that requires the contractor to assume full responsibility for repairing or replacing defects in pavements during a specified period. Preliminary engineering: The project development phase involving activities such as environmental review, preparation of construction documents, work zone impacts, development of geometric design, utilities discovery and verification, geotechni- cal studies for foundation and pavement design, preliminary drainage work, and cost estimates. Preventive maintenance: A planned strategy of cost-effective treatments to an existing roadway system and its appurte- nances that preserves the system, retards future deterioration, and maintains or improves the functional condition of the system (without significantly increasing the structural capacity). Probabilistic analysis: Approach that considers the inherent variability of inputs in addition to single-point estimates. Publicâprivate partnership (P3): A contractual agreement formed between a public agency and a private-sector entity that allows for greater private-sector participation in the delivery and financing of transportation projects. Rehabilitation: The act of restoring a pavement to a former condition. Remaining service life: Structural life remaining in the pavement at the end of analysis period. Request for proposals: A document issued by the procuring agency to potential bidders detailing the requirements of a spe- cific service or commodity sought on a particular project and soliciting detailed proposals from them. Residual value: Value of the in-place pavement materials less the cost to remove and process the materials for reuse. Responsive bid: A bid submittal that meets all the requirements of the advertisement and proposal. Risk: The potential impact of an uncertain condition or action on project objectives and outcomes. Risk allocation: The process of allocating contractual obligations and risks between parties.
