Outsourcing Roadway Maintenance Study Findings and Recommendations
SB377 in 2009 aimed to change NDOT's maintenance approach, leading to a study on contracting. The study explored various outsourcing methods, decision factors, and cost effectiveness information. Interviews highlighted advantages of contracting like cost reduction, improved efficiency, and innovation.
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Presentation Transcript
Richard Nelson, PE, F.ASCE Assistant Director Operations Nevada Department of Transportation
Outsourcing Roadway Maintenance Background Literature Search Interviews Report Recommendations Methodologies The Roadmap Challenges 2/24/2025 2
Background In 2009, SB377 would have eliminated NDOT s ability to self-perform roadway maintenance Amended to allow NDOT to contract up to $250,000 utilizing a 3-quote process NDOT agreed to perform a study of contracting for maintenance & increase current contracting February 2010 Halcrow began work on the Study Final draft in hand, final report in April 2011. 2/24/2025 3
Background Lane Miles (2008) 185,957 200,000 180,000 160,000 140,000 120,000 100,000 65,465 80,000 63,391 60,000 39,311 30,943 31,580 40,000 19,583 14,098 20,000 - Nevada Utah Arizona Montana Washington Florida Missouri Texas State 2/24/2025 4
Background Daily Vehicles per Lane 7000 5768 6000 5000 4314 4000 3194 3197 2947 2710 3000 2177 2000 747 1000 0 Montana Missouri Utah Texas Washington Nevada Arizona Florida State 2/24/2025 5
Literature Search 39 Studies and reports identified: Outsourcing Decision Factors Contracting Methodology/Guidelines Cost Data and Cost Effectiveness Information How to measure cost effectiveness, comparison matrix 2/24/2025 6
Literature Search Reasons for Contracting : Reducing costs Increasing efficiency Improving quality Speeding project delivery Spurring innovation Enhancing risk management Overcoming a lack of expertise. 2/24/2025 7
Literature Search Outsourcing Methods: Purchase Orders Single Bid Item Contracts Bundled Bid (Multiple Bid Item) Contracts Performance Based Maintenance Contracts Managing Agent Contracts. 2/24/2025 8
Interviews Advantages of Contracting Efficiency Flexibility Enthusiasm Creativity Neither group mentioned direct cost as a factor. 2/24/2025 9
Interviews Disadvantages NDOT s geographic presence would be challenging for contractors to offer rapid response that would be comparable to NDOT in rural areas. NDOT s could lose expertise & assets leaving little options if contractor capacity evaporates. May lead to artificially higher costs. (Contractors believe competition will keep the pricing within market value even if NDOT was not one of the competitors). 2/24/2025 10
Contract Workshop International Presentations Emcon, BC - Managing and Maintaining Roads in British Columbia by Contract Amey,UK - Performance Contracting for Road Maintenance in the United Kingdom Swedish Road Administration - Maintenance Contracting from the Owners Perspective Roundtable Discussion Breakout Sessions Joint Session 2/24/2025 11
Some Recommendations Common lexicon & Terms of Reference. Develop performance standards and maintenance rating system. Utilize a contracting decision matrix. 2/24/2025 12
Some Recommendations Package contracts to make them cost effective and attractive to contractors. Design contracts with longer work periods and consider multi-task and multi-year terms. Pilot alternative contract maintenance delivery methods. 2/24/2025 13
Contracting Methodology Schedule of Rates Single Bid Item Multiple Bid Item Performance Based Maintenance Contracts (PBMC) Managing Agent Contracts (MAC) 2/24/2025 14
Cost Comparison Challenges Different cost centers to account for direct and indirect costs. Difficult to collect cost data from contractors other than bids. Were projects sufficiently similar (size, scope & specifications) to afford a cost comparison? 2/24/2025 15
What To Contract? NDOT currently contracts about 35% of its maintenance program. All micro-seals, CIR, and 50% of chip seals Routine activities and bundled activities seem likely candidates to contract. Sweeping Striping Shoulder and roadside bundles (shouldering, guideposts, guardrail) 2/24/2025 16
The Roadmap Outlines activities to complete the evaluation of contract maintenance Performance specifications & measures Implement pilot projects Legislative barriers and recommendations Decision matrix Cost comparisons Final recommendations on Contract Maintenance 2/24/2025 17
Challenges Contractor capacity Management of current assets during the pilot program Flexibility of current business models - Industry and NDOT Maintain a reliable level of service during evaluation 2/24/2025 18
Thank You For Your Attention Rnelson@dot.state.nv.us 2/24/2025 19
