Technical Report Documentation Page
1. Report No.
FHWA/ TX- 05/ 0- 4661- 1
2. Government
Accession No.
3. Recipient’s Catalog No.
5. Report Date
October 2004; Revised April 2005
4. Title and Subtitle
2004 Annual Interim Report
6. Performing Organization Code
7. Author( s)
James T. O'Connor, G. Edward Gibson Jr.,
Giovanni C. Migliaccio
8. Performing Organization Report No.
0- 4661- 1
9. Performing Organization Name and Address 10. Work Unit No. ( TRAIS)
Center for Transportation Research
The University of Texas at Austin
3208 Red River, Suite 200
Austin, TX 78705- 2650
11. Contract or Grant No.
0- 4661
13. Type of Report and Period Covered
Technical Report
September 2003 to October 2004
12. Sponsoring Agency Name and Address
Texas Department of Transportation
Research and Technology Implementation Office
P. O. Box 5080
Austin, TX 78763- 5080
14. Sponsoring Agency Code
15. Supplementary Notes
Project conducted in cooperation with the Federal Highway Administration and the Texas Department of
Transportation. Project Title: Monitoring and Evaluation of SH130 Project Construction
16. Abstract
This report includes a synthesis of the main findings from the investigations conducted during the first year of the
research project.
17. Key Words
CDA Procurement, CDA Contracting, CDA
Organizational Structure
18. Distribution Statement
No restrictions. This document is available to the
public through the National Technical Information
Service, Springfield, Virginia 22161; www. ntis. gov
19. Security Classif. ( of report)
Unclassified
20. Security Classif. ( of this page)
Unclassified
21. No. of pages
32
22. Price
Form DOT F 1700.7 ( 8- 72) Reproduction of completed page authorized
2004 Annual Interim Report
James T. O'Connor, P. E., Ph. D.
G. Edward Gibson Jr., P. E., Ph. D.
Giovanni C. Migliaccio
CTR Research Report: 0- 4661- 1
Report Date: October 2004, Revised April 2005
Research Project: 0- 4661
Research Project Title Monitoring and Evaluation of SH130 Project Construction
iv
Center for Transportation Research
The University of Texas at Austin
3208 Red River
Austin, TX 78705
www. utexas. edu/ research/ ctr
Copyright ( c) 2005
Center for Transportation Research
The University of Texas at Austin
All rights reserved
Printed in the United States of America
v
Disclaimers
Author's Disclaimer: The contents of this report reflect the views of the authors, who
are responsible for the facts and the accuracy of the data presented herein. The contents do not
necessarily reflect the official view or policies of the Federal Highway Administration or the
Texas Department of Transportation ( TxDOT). This report does not constitute a standard,
specification, or regulation.
Patent Disclaimer: There was no invention or discovery conceived or first actually
reduced to practice in the course of or under this contract, including any art, method, process,
machine manufacture, design or composition of matter, or any new useful improvement thereof,
or any variety of plant, which is or may be patentable under the patent laws of the United States
of America or any foreign country.
Engineering Disclaimer
NOT INTENDED FOR CONSTRUCTION, BIDDING, OR PERMIT PURPOSES.
Project Engineer: James T. O’Connor
Professional Engineer License State and Number: Texas No. 64532
P. E. Designation: Research Supervisor
vi
Acknowledgments
The authors express their deepest gratitude to the research committee, namely Timothy
Weight, Bob Hundley, and Andrew Griffith. We also wish to thank the numerous interviewed
TxDOT and legal consultant representatives for their contribution in time and expertise to this
research, particularly Robert Stuard with the TxDOT Austin District, Jeff Curren with HDR Inc.,
and Corey Boock with Nossaman. Without their willingness to participate, this research would
not have been possible. The authors also gratefully acknowledge the sponsorship and assistance
of the Texas Department of Transportation.
vii
Table of Contents
1. Introduction................................................................................................................... ............. 1
2. Product No. 1: CDA Procurement Process................................................................................. 3
2.1 Highlights of Product No. 1................................................................................................... 3
2.1.1 Phases/ Activities ............................................................................................................ 3
2.1.2 Durations...................................................................................................................... . 5
2.1.3 Selected Lessons Learned .............................................................................................. 6
3. Product No. 2: Essential Elements of CDA Contracting ............................................................ 9
3.1 Highlights of Product No. 2................................................................................................... 9
3.1.1 Essential Contract Topics/ Sections................................................................................ 9
3.1.2 Selected Significant Differences.................................................................................. 11
4. Product No. 3: Organization Structure & Communication....................................................... 15
4.1 Topics Being Investigated ................................................................................................... 15
4.1.1 Interview Guide ........................................................................................................... 15
4.1.2 Program of Interviews.................................................................................................. 15
4.1.3 Path Forward................................................................................................................ 16
5. Summary ............................................................................................................................... ... 17
6. References..................................................................................................................... ........... 19
Appendix A: Interview Guide Used for Product 3 ....................................................................... 21
viii
ix
List of Figures
Figure 2.1: Overview of Comprehensive Development Agreement
Procurement Process with Schedule and Milestones.......................................................... 4
List of Tables
Table 2.1: Phase Durations and Duration Drivers .......................................................................... 5
Table 3.1: SH130 EDA versus SH45 SE CDA............................................................................. 10
Table 4.1: Product No. 3 – Interviews Status ................................................................................. 16
x
1
1. Introduction
This report conveys significant findings from Research Project 0- 4661 during the first year of
investigation ( September 2003 to September 2004). Information regarding project development
is also provided.
During this first year, the following research products were produced:
􀂊 Research Product No. 1 - CDA Procurement Process Model ( Research Report 0- 4661- P1)
􀂊 Research Product No. 2 - Essential Elements of CDA Master Contract ( Research Report
0- 4661- P2)
First, findings regarding Research Product No. 1 are summarized, including a breakdown of
the Comprehensive Development Agreement ( CDA) procurement phases with durations and
duration drivers, as well as lessons learned collected to date.
In the next section, results from Research Product No. 2 are conveyed, focusing on essential
contract clauses and significant differences between CDA and traditional design- bid- build
contracting.
Finally, the progress on Research Product No. 3 ( Documentation of the SH130
Organizational Structure) is outlined.
3
2. Product No. 1: CDA Procurement Process
The first deliverable produced during the first year of research was a process model for
Comprehensive Development Agreement ( CDA) procurement, including a development and
discussion of the CDA procurement process flowchart, its phase durations and duration drivers,
and lessons learned to date regarding CDA procurement. These findings were included in
Product No. 1: CDA Procurement Process Model ( Research Report 0- 4661- P1). That report
provides a process model to conduct the procurement phase for a project operating under a CDA.
The following subsections include some of the report findings.
2.1 Highlights of Product No. 1
2.1.1 Phases/ Activities
Analyses of the SH130 procurement indicate that the CDA procurement process is
accomplished in four key phases:
􀂊 Toll Viability Study
􀂊 Prequalification
􀂊 Proposal Preparation and Evaluation
􀂊 Contract Finalization
The resulting process map presents a way to address the procurement of a CDA project that
includes results from lessons learned in the SH130 CDA. Researchers took into consideration
lessons learned in term of sequencing activities collected by interviewing both SH130 and SH45
SE project representatives. Most of the lessons learned reflect similar findings reported from
industry representatives across the country and included in the FHWA D- B Final Rule ( FHWA,
2002). Incorporating experiences during SH45 SE project procurement was helpful in
identifying differences between two CDA projects, one under SEP- 14 ( SH130), the other under
the FHWA D- B Final Rule ( SH45 SE).
The first phase in the process map— conducting the toll viability study— may be optional and
is not covered in detail. It mostly depends upon factors external to the process, such as the
financing needs and Texas Transportation Commission requests. When conducted, study
conclusions provide a starting point for the Request for Detailed Proposal ( RFDP) document.
4
The subsequent three phases are non- optional elements of CDA procurement. Activities
within these three phases overlap as shown below and in Appendix A of Report 0- 4661- P1
( Product No. 1).
Figure 2.1 Overview of Comprehensive Development Agreement Procurement Process with
Schedule and Milestones
The Prequalification phase is subdivided into three subphases: initially, the Department
prepares a Request for Proposals and Qualifications ( RFPQ), then TxDOT interacts with
interested parties pertaining to their submittals, and finally TxDOT evaluates the Proposals and
Qualifications Submittal ( PQS) before releasing a shortlist of qualified proposers.
During phase three ( Bid Preparation and Evaluation), the Department prepares a Request for
Detailed Proposals ( RFDP). This document passes through an interactive stage with the short-listed
firms during which risks are discussed and allocated between project parties. After public
release of the final RFDP to short- listed firms, the Department interacts with interested parties by
scheduling recurring rounds of one- on- one meetings. Finally, an evaluation of the submitted
proposals is conducted in order to determine the firm offering the best value and to recommend it
to the State Transportation Commission.
5
2.1.2 Durations
The following table presents information on typical durations for each phase. It also lists
duration drivers as identified from project representatives.
Table 2.1 Phase Durations and Duration Drivers
Phase SH130
Duration
SH45SE
Duration
Recommended
Duration
Key Duration Drivers
Toll
Viability Study
Pre-
Qualifications
14
months
4
months
3– 6 months 􀂊 Presence of Bond financing
􀂊 Presence of Developer financing
Bid
Preparation and
Evaluation
23
months
8
months
16– 26 months 􀂊 Develop Preliminary Engineering
􀂊 Develop Geometric Design
Engineering
􀂊 Conducting Industry Review -
Allocate Risks
􀂊 Identify qualifications for
developer key personnel
􀂊 Identify QA/ QC role
􀂊 Evaluate Alternative Technical
Concepts ( ATC)
Contract
Finalization
3
months
1 month 1– 3 months 􀂊 Include ATC from unsuccessful
proposers in final scope ( SEP- 14 only; N/ A
for FHWA D- B Final Rule)
􀂊 Texas Transportation Commission
Schedule
6
2.1.3 Selected Lessons Learned
The following procurement process lessons are given based on interviews and findings
during the first year of studies.
Before starting to prepare the RFPQ:
􀂊 Achieve a basic understanding of the project description in terms of location,
characteristics, scope of work, and risk allocation.
􀂊 Make RFPQ documentation from other CDA projects available for consultation to project
team.
In preparing the RFPQ document:
􀂊 Early in the process, release to legal counsel a status report on:
o project’s development
o environmental clearance process
o amount of preliminary engineering to include in the RFPQ
􀂊 Develop a suggested evaluation schedule before appointing the evaluation subcommittee
members in order to understand needed size and qualifications that are crucial for
achieving a streamlined evaluation process.
In interacting with interested parties for developing PQSs:
􀂊 If the project includes bonds or developer financing options, having one- on- one meetings
with interested firms allows the TxDOT team to probe the reactions of the interested
parties in terms of the requirements, and to take any necessary corrective action.
In developing the RFDP document:
􀂊 Start developing technical attachments earlier in the process to decrease process duration.
􀂊 Conduct interactive sessions between attorneys, engineering consultants, and the client
early in the development of all the documents to improve the attorneys’ understanding of
the technical provisions, and to decrease the risk of overlapping or missing information
by identifying which information goes in the contract and which needs to go in the
technical provisions.
In conducting the industry review phase:
􀂊 Identify and monitor the status of other critical path activities, like environmental process
status or preliminary engineering status to completion, in order to find the optimal trade-off
between schedule and to benefit from the industry review process.
􀂊 Establish the number of one- on- one meetings depending on project complexity and
procurement schedule pressure.
7
In developing the Proposals Evaluation Process:
􀂊 Prepare a suggested schedule for evaluations, and contact suggested subcommittee
members to confirm their availability before appointing them.
In interacting with short- listed firms for developing detailed proposals:
􀂊 Allocate sufficient time between issuing the RFDP and the first round of meetings to
allow proposers to thoroughly analyze the document and make comments.
􀂊 Schedule two different rounds of one- on- one meetings with an interval sufficient to ( a)
allow the legal counsel time to revise the document, ( b) distribute it to the proposers in
the form of addenda, and, ( c) finally, allow the proposers to analyze it.
In forming the Alternative Technical Concepts ( ATC) Evaluation Committee and
Subcommittees:
􀂊 Understand size and qualifications needed to shorten the evaluation process enough to
allow proposers to include specific ATCs in the final proposal.
In interacting with short- listed firms for selecting ATCs:
􀂊 There is a need for a pre- screening process to limit the effort in evaluating ATCs. For
instance, defining a minimum dollar amount threshold for cost- saving ATCs can avoid
time- consuming evaluations on ATCs less cost effective.
9
3. Product No. 2: Essential Elements of CDA Contracting
Another research deliverable produced in the first year of study was an overview of CDA
Master Contract Elements, including a table of fundamental differences between CDA and
traditional design- bid- build contracting, and a set of lessons learned pertaining to contract
clauses. These findings were included in Product No. 2: Essential Elements of CDA Master
Contract ( Research Report 0- 4661- P2). The primary purpose of this research product was to
facilitate preparation of future CDA contracts. This document primarily includes findings from
the State Highway 130 ( SH130) project, but also incorporates some findings from the State
Highway 45 South- East ( SH45 SE) project. The following sections highlight key findings.
3.1 Highlights of Product No. 2
3.1.1 Essential Contract Topics/ Sections
The first CDA contract for the SH130 project was structured into 29 sections plus 16
exhibits. The subsequent CDA contract for the SH45 SE streamlined that structure by grouping
some sections or giving independence to others. The resulting contract structure included 24
sections and 15 exhibits. Table 3.1 gives a comparison of the contract structure for each.
10
Table 3.1 SH130 EDA versus SH45 SE CDA
SH130
EDA
[ Sectio
n]
Section / Sub- section
SH45 SE
CDA
[ Section /
Exhibit]
1 CONTRACT COMPONENTS [ 1]
2 GENERAL FRAMEWORK AND OUTLINE OF TRANSACTION [ 2, 19.2]
3 SCOPE OF DEVELOPMENT WORK; ROLE OF THE PARTIES AND LOCAL
AGENCIES; EFFECT OF TESTS AND INSPECTIONS
[ 2.1, 2.2,
5.5]
4 INFORMATION SUPPLIED TO DEVELOPER; ACKNOWLEDGMENT BY
DEVELOPER
[ 1.3, 1.4,
2.1.3]
5 TIME WITHIN WHICH PROJECT SHALL BE COMPLETED; PROJECT SCHEDULE
AND PROGRESS [ 4]
6 RIGHT OF WAY SERVICES [ 6]
7 COMMENCEMENT OF CONSTRUCTION; CONSTRUCTION PROCEDURES;
HAZARDOUS MATERIALS; NEW ENVIRONMENTAL APPROVALS
[ 4.4, 5.1,
5.2, 5.3, 5.4, 5.6,
6.9, 6.10]
8 DISADVANTAGED BUSINESS ENTERPRISE; CIVIL RIGHTS [ 7]
9 PERFORMANCE AND PAYMENT SECURITY [ 8]
10 INSURANCE [ 9]
11 SITE SECURITY; RESPONSIBILITY FOR LOSS OR DAMAGE [ 10.2, 10.3]
12 WARRANTIES [ 11]
13 PAYMENT [ 12, 22.9]
14 CHANGES IN THE DEVELOPMENT WORK [ 13, 6.8]
15 SUSPENSION OF ALL OR PART OF THE WORK [ 14]
16 TERMINATION FOR CONVENIENCE [ 15]
17 DEFAULT [ 16]
18 DAMAGES [ 17]
19 LABOR AND EMPLOYMENT REQUIREMENTS [ 7]
20 COMPLETION AND ACCEPTANCE [ 20]
21 VALUE ENGINEERING ( VE) [ 22]
22 REPRESENTATIONS AND WARRANTIES [ 2.2, 10.1]
23 INDEMNIFICATION; RELEASES [ 18, 24.6]
24 TORT LIABILITY [ 24.8]
25 DISPUTE RESOLUTION [ 19, Ex- M]
26 DOCUMENTS AND RECORDS [ 21]
27 COOPERATION AND COORDINATION WITH OTHER CONTRACTORS AND
GOVERNMENTAL ENTITIES [ 23]
28 GOVERNING LAW; COMPLIANCE WITH LAW AND REFERENCE STANDARDS [ 1.4, 1.9,
24.9, Ex - D]
29 MISCELLANEOUS [ 24, 1]
EX- A ABBREVIATIONS & DEFINITIONS [ Ex - A]
EX- B SCOPE OF WORK Technical
Provisions
EX- C REFERENCE DOCUMENTS [ Ex - N]
EX- D FEDERAL REQUIREMENTS [ Ex - D]
EX- E AMENDMENTS, MODIFICATIONS AND SUPPLEMENTS TO TXDOT STANDARD
SPECIFICATIONS [ Ex - B]
EX- F MAXIMUM PAYMENT CURVE [ Ex - F]
EX- G DBE PROGRAM [ Ex - G]
EX- H FORM OF PERFORMANCE BONDS [ Ex - H]
EX- I FORM OF PAYMENT BONDS [ Ex - I]
EX- J FORM OF WARRANTY BOND [ Ex - O]
EX- K FORM OF DRAW REQUEST AND CERTIFICATE [ Ex - J]
EX- L QC/ QA SUMMARY TABLES No
EX- M FORM DEVELOPER NOTE No
EX- N FORM OF CHANGE ORDER [ Ex - K]
11
SH130
EDA
[ Sectio
n]
Section / Sub- section
SH45 SE
CDA
[ Section /
Exhibit]
EX- O INITIAL DESIGNATION OF AUTHORIZED REPRESENTATIVES [ Ex - L]
EX- P DEVELOPER COMMITMENTS AND ATCS [ Ex - N]
3.1.2 Selected Significant Differences
An analysis of significant differences between CDA and traditional design- bid- build contract
provisions follows:
Order of Precedence between Contract Elements
􀂊 For traditional contracting, TxDOT Standard Specifications outline an order of
precedence between some contractual documents. Because CDA contracting included
under an umbrella many contracts that traditionally were managed separately, the
increased complexity of the contractual environment makes the precedence issue more
critical in case of disagreement. As a consequence, both CDA contracts defined this
precedence in the first section of the contract and included in the ranking other
documents such as change order and contract amendments.
Role of Program Manager
􀂊 The complexity of D- B project management and shortage of staff necessitated that
TxDOT utilize an engineering consultant to help in managing the CDA process. This
firm, identified with the term “ Program Manager,” has a prominent role in project
management and on contract interpretation issues. Therefore, both existing CDA
contracts defined the role of Program Manager ( in these cases HDR, Inc.). While the
SH130 contract introduces this entity in a clause regarding TxDOT’s role, the SH45 SE
contract inserted a specific clause on its role ( 3.4 Role of Program Manager) that does not
place limits on its authority.
Payment
􀂊 Both CDA contracts have significant contract amounts ($ 1.3 billion and $ 150 million)
that make budgeting and bond release issues ( for SH130) critical for the project success.
In their proposals, proposers provided the payment curve amounts that were used to
calculate the present value of the draw schedule between the proposers when determining
the best value proposer. Consequently, because the payment curve was critical for
selecting the Developer, a contract provision on maximum payment curve was adopted in
order to tie the Developer to his proposal. A consequent advantage from having such a
clause is to make predictable and controllable the payment over the project’s execution
life.
ROW
􀂊 Acquisition of Final ROW: Different from traditional projects, ROW acquisition services
are the responsibility of the Developer and are included in the CDA contract. Both CDA
contracts adopted similar language to manage this issue: the Agreement referenced the
12
corresponding section of the Technical Provisions, as well as external references and
manual amendments.
􀂊 Costs of Acquisition: Compared to the SH130 contract, the SH45 SE contract:
o is more prescriptive in describing the associated costs allocated to the Developer
( surveying, fees and expenses associated with condemnation services),
o has allocated to TxDOT the real property costs associated with the ROW as shown on
the schematic design included with the RFDP documents,
o has allocated to the Developer any cost associated with acquiring properties for
drainage easements except in case of TxDOT- Directed Change,
o does not allow an increase in the price or any time extension for site conditions and
delay, inability or cost associated with Developer- Designated ROW; and finally
o outlines a process to manage ROW activities for parcels in which the Developer holds
a real property interest.
These changes reflect the learning curve in managing CDA contracting and validate lessons
learned from the SH130 project team ( presented in the next section). Traditional projects do not
need this provision because TxDOT manages the ROW process.
􀂊 Limiting Acquisition of Additional Properties: In traditional contracting, where ROW
services are self performed by TxDOT, a tradeoff between cost of acquisition and future
construction cost is pursued in the interest of the state. CDA contracts allocated the
ROW acquisition cost to TxDOT but the cost of construction and ROW services to the
Developer. Because ROW services are Developer performed, there is the risk that the
Developer will acquire more ROW than anticipated or need to save on construction costs.
In order to prevent this, CDA contracts set a ROW corridor. TxDOT is responsible for
acquiring land within this corridor; however, the Developer is free to acquire additional
property if he was willing to pay for it. On this issue, the SH45 SE contract specifically
mentions the obligation for the Developer to restrict additional costs related with drainage
easements and Mitigation Sites.
􀂊 Representations by Developer: In terms of managing the Developer’s role, the SH45 SE
is very innovative. In fact, the Developer’s designated ROW Project Manager is entitled
to undertake the ROW acquisition services as a TxDOT agent, meaning that he can make
an offer on behalf of TxDOT. Alternatively, the SH130 contract has specifically
forbidden members of the Developer Group from representing themselves as TxDOT
agents.
􀂊 Right of Early Entry: A significant innovation is the inclusion of a clause that allows the
Developer to acquire a “ right of early entry” in properties for which access has not yet
been acquired. Both CDA contracts approach this issue similarly. Interviews with project
representatives highlighted this innovative clause as critical for speeding up the project
execution process and for triggering an early commencement of construction activities.
Environmental Compliance
􀂊 Another innovation of CDA contracting is that it assigns most environmental risks to the
Developer including them in the lump sum price.
􀂊 This innovation requires clearly defined roles and responsibilities of the contract parties
in terms of permit approvals. Both CDA contracts include two contract provisions that
assign environmental responsibilities to the two parties.
13
o TxDOT responsibilities: the two CDA Contracts address this issue in different ways.
On the SH45 SE project, TxDOT retained more of the risk rather than having the
Developer price it. For instance, the SH45 SE allocates the costs and performance of
all mitigation requirements contained in the USACE Nationwide Permit to TxDOT.
o Developer responsibilities: CDA contracts assign to the Developer most of the
responsibility for obtaining new environmental approvals. The SH45 SE contract
explicitly includes Developer responsibility for the task of obtaining new
environmental approvals related to drainage easements and ROW outside the
Schematic ROW.
Performance and Payment Security
􀂊 The SH45 SE contract follows the TxDOT manual for traditional contract administration
by requiring performance bonds covering the full value of construction work. The
SH130 contract used a different and more complex approach in order to alleviate issues
with bonding capacity: two different sets of bonds are issued, the first relating design,
ROW, and other services performed under NTP1 ( notice to proceed no. 1) for an amount
of $ 50 million, and the second covering the construction phase for an amount of $ 350
million. This graduated approach was needed in order to allow the bond sale and closing
before the release of NTP2. Moreover, the SH130 contract required a proposal bond to
be in place from the proposal date until performance and payment bonds were received.
The SH45 SE contract did not require this bond, adopting a full NTP approach as
opposed to the graduated approach of SH130.
Change Orders
􀂊 Definition of Change Order: In traditional projects, TxDOT takes most of the risk for
unknowns, and change orders are tied to a range for the contract quantity. Additionally,
the definition of change orders heavily rely on the concepts of “ significant change” and
“ major item.” On the other hand, in CDA projects, TxDOT shares risks with the
Developer; therefore, change orders are defined as modifications to the fixed price or to
schedule milestones ( i. e., completion deadline and acceptance deadline). Another
fundamental difference is that CDA contracts defined a monetary threshold below which
the Developer handles the cost of the change ( i. e., $ 10,000 for SH130 and $ 5,000 for
SH45 SE).
􀂊 Force Majeure Events: These events are denominated “ Acts of God” in the TxDOT
Standard Specifications ( 7.14) and include earthquakes, tornado, hurricane, tidal wave,
and other cataclysmic phenomena of nature. CDA contracts also included under this
denomination other uncertainties specific to the project. For instance, the SH45 SE
contract considers any changes in requirements for USACE permits a force majeure
event, whereas the SH130 contract includes in the definition new utilities and Karst
features requiring investigations.
􀂊 Differing Site Conditions: While the TxDOT manual for traditional contract
administration ( CCAM) entrusts the TxDOT engineer with most of the responsibilities
relating to the solution of this issue, CDA contracts allocate most responsibilities to the
Developer for working around the impacted locations, and the Developer is responsible
for determining the appropriate action to be undertaken. The two D- B contracts adopted
14
the same structure for allocating risk between the Department and the Developer. They
charge the whole risk in terms of time to the Developer (“ No time extension shall be available
with respect to Differing Site Conditions, and no delay damages shall be recovered”). However, they
allow the Developer to share additional costs from Differing Site Conditions with the
Department. Both introduce a threshold of $ 5,000,000 ( SH130) and $ 1,000,000 ( SH45
SE) in additional costs, after which TxDOT becomes responsible. The latter contract
( SH45SE) introduces two different procedures to track costs. Moreover, it introduces the
need for an official statement signed by a qualified professional.
Utility Adjustments Services
􀂊 Notable differences between CDA and traditional contracting are:
o Utility relocation in developer scope
o Risk of uncharted utilities borne by developer within a maximum threshold:
Developer non- compensable deductible and deductible cumulative cap for
unidentified utilities. The Developer takes the risk of the first $ 50,000 for each
unidentified utility for “ no more than $ 1,000,000 of such $ 50,000 deductibles for
Utility Adjustment Work authorized by issuance of NTP2.” ( TxDOT 2001, p. 90).
o No time extension for inaccurate utility information. SH45 SE CDA slightly changed
the definition of identified utilities. This change reflects the learning curve in
managing CDA contracting and validates lessons learned from the SH130 project
team ( presented in the next section).
o In SH 45 SE, because TxDOT was unable to gain access to the HEEP ranch property
to locate a private water line, the contract assumed some quantities and requested bid
unit prices on relocation costs for this private water line.
o Both CDA contracts defined a new utility as a utility installed after the proposal date.
The SH130 contract allocated schedule risk associated with new utilities to the
Developer, whereas in the SH 45 SE contract, cost and schedule risk of new utility
relocation were transferred both to TxDOT.
15
4. Product No. 3: Organization Structure & Communication
One current focus of ongoing research is to gather information about the CDA project
looking closely at the organizational structures and communication flows. This information will
be used to document and analyze SH 130 organizational and communication structures, and to
track associated lessons learned. A draft of the SH 130 organizational and communication
structure will be included in Product No. 3: ( Future Research Report 0- 4661- P3). Collected
lessons learned will also be included in Product No. 6: Lessons Learned Database ( Future
Research Report 0- 4661- P6).
4.1 Topics Being Investigated
4.1.1 Interview Guide
To pursue this research, researchers developed a semistructured interview guide with
questions grouped in three sections as follows:
􀂊 First, focus on significant differences in how key organizations have structured their
organizations for this CDA contract in contrast to traditional D- B- B projects.
􀂊 Second, examine the unique relationship between owner ( TxDOT) and program
manager ( HDR).
􀂊 Finally, investigate unique or innovative communication flows between different
elements of the project team.
A complete version of the interview guide is included in Appendix A.
4.1.2 Program of Interviews
Four interviews with project representatives have been conducted to date. Researchers plan
to interview key personnel within the three involved parties ( TxDOT, HDR- Program Manager,
and LSI- Developer). A list of personnel contacted to date follows in Table 4.1.
16
Table 4.1 Product No. 3 – Interviews Status
Organizat
ion Job Title Name
Contacted
Scheduled
Complete
d
HDR SH130 Design
Manager
Rick Klatt
HDR SH130 Construction
Manager
Ken Smith
HDR SH130 ROW Manager Teri Morgan
HDR SH130 Environmental
Manager
Doug Hagemeier
HDR SH130 Utility
Specialist
Scott Colter
HDR SH130 Information
System Manager
Manuel Zarate
LSI Program Director Douglas Fuller
LSI Deputy Director Bob Stevens
LSI Construction Director John Rempe
0
LSI Design Director Sharon Gookin
1
LSI Project Control
Director
Michael Lipinski
2
LSI Environmental
Manager
Tom Van Zandt
3
TxDOT ROW Turnpike
Manager
Don Toner
4
TxDOT Turnpike
Environmental Manager
John Geiselbrecht
5
TxDOT Utility Turnpike
Manager
John Breed
6
TxDOT Construction Turnpike
Director
Robert Crowson
7
TxDOT Design Turnpike
Manager
Evertson, J. Terron
4.1.3 Path Forward
During the next several months, researchers plan to complete this round of interviews and to
integrate findings in Product No. 3 ( Future Research Report 0- 4661- P3).
17
5. Summary
During the first year of investigations, Research Project 0- 4661 delivered two research
products ( P1 and P2) with another three products ( P3, P5, and P7) currently in development.
The completed, published products are:
􀂊 Product Number 1: CDA Procurement Process Model
􀂊 Product Number 2: Essential Elements of CDA Master Contract
Efforts are underway for three additional products:
􀂊 Product Number 3: Documentation of the SH 130 Organizational Structure ( First
Version)
􀂊 Product Number 5: Benchmarking Methodology for Comparing CDA contracts to
conventional projects
􀂊 Product Number 7: Annual SH130 innovation workshop.
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6. References
Federal Highway Administration ( FHWA) ( 2002). “ Design- Build Contracting; Final Rule.”
Federal Register, 67 ( 237), pp. 75901– 75935.
J. T. O'Connor, G. E. Gibson Jr., G. C. Migliaccio ( 2004). “ Product No. 1 – CDA Procurement
Process Model,” Research Report Number 0- 4661- P1, Center for Transportation Research, The
University of Texas at Austin, Austin, Texas.
J. T. O'Connor, G. E. Gibson Jr., G. C. Migliaccio ( 2004). “ Product No. 2 – Essential Elements
of CDA Master Contract,” Research Report Number 0- 4661- P2, Center for Transportation
Research, The University of Texas at Austin, Austin, Texas.
Texas Department of Transportation ( TxDOT) ( 2001). Request for proposals to construct,
maintain and repair the SH130 turnpike through an exclusive development agreement: Exclusive
Development Agreement. Austin, TX: Texas Department of Transportation.
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Appendix A:
Interview Guide Used for Product 3
1. Significant Organizational Differences
1.1. TxDOT- Owner
1.1.1. What are some very significant differences from traditional D- B- B projects in how
the TxDOT is organized for this CDA contract? ( i. e., compare with other traditional turnpike
projects)
1.1.2. How/ why has each difference been significant?
1.1.3. Regarding TxDOT’s organizational structure, what specifically would you do
differently on the next CDA?
a. Any area where overstaffing was a problem?
b. Any area where understaffing was a problem?
c. Any critical role/ responsibility not well defined or understood?
1.2. HDR- Program Manager
1.2.1. What are some very significant differences from traditional D- B- B projects in how
the Program Manager is organized for this CDA contract? ( i. e., compare with other traditional
turnpike projects)
1.2.2. How/ why has each difference been significant?
1.2.3. Regarding HDR’s organizational structure, what specifically would you do
differently on the next CDA?
a. Any area where overstaffing was a problem?
b. Any area where understaffing was a problem?
c. Any critical role/ responsibility not well defined or understood?
1.3. LSI- Developer
1.3.1. What are some very significant differences from traditional D- B- B projects in how
the Developer is organized for this CDA contract? ( i. e., compare with other traditional turnpike
projects)
1.3.2. How/ why has each difference been significant?
1.3.3. Regarding LSI’s organizational structure, what specifically would you do differently
for the next CDA?
a. Any area where overstaffing was a problem?
b. Any area where understaffing was a problem?
c. Any critical role/ responsibility not well defined or understood?
2. Program Manager ( HDR) – TxDOT Relationship
2.1.1. Any lesson learned thus far in setting up/ operating under this relationship?
a. Misallocation of duties?
b. Compatibility of operating procedures/ systems?
c. Sufficiency of staff?
2.1.2. What would you do differently on the next CDA?
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3. Communication Flows
3.1.1. Where/ in what way have project team communications been most challenged?
3.1.2. How significant has colocation between TxDOT, HDR, and LSI been in achieving
effective communication? If possible, please describe some specific examples.
3.1.3. Has any “ short- circuiting” of communications between TxDOT/ HDR and LSI subs
been problematic?
3.1.4. Have there been any unique aspects of communications notably successful for this
CDA?
a. Any notable communication successes or lessons learned in the design area?
b. Any notable communication successes or lessons learned in the ROW area?
c. Any notable communication successes or lessons learned in the utility relocation
area?
d. Any notable communication successes or lessons learned in other project processes?