The Resource for Transportation Professionals | Winter 2017

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Program Management

3 Multi-contract, 38-mile roadway project adapts to face challenges

PMC manages 38-mile US 290 Program in HoustonUS 290 Program Office

6 Hiring an ally Determining which projects call for a PMC

David Downs, PENational Program/Construction Management Practice Leader HNTB Corporation

9 KDOT leverages PMC during first major design-build project in state

32-month project completed on schedule

Paul GripkaProject Director for the Johnson County GatewayKansas Department of Transportation

Carmen BakarichAttorney and Manager of Contract ClaimsKansas Department of Transportation

Transportation Point™ is published by HNTB Corporation. HNTB is an infrastructure solutions firm providing award-winning planning, design, program management and construction management services. Please direct all questions or comments about Transportation Point to corporatecommunications@hntb.com.

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Multi-contract, 38-mile roadway project adapts to face challengesPMC manages 38-mile US 290 Program in HoustonThe Texas Department of Transportation continues to progress with the massive reconstruction and expansion of U.S. Highway 290 in Houston. The 38-mile, design-bid-build project has been fast tracked to bring much-needed congestion relief to Houston’s busiest corridor. TxDOT split the corridor into 13 segments to manage contracts and corresponding funding.

Like many large-scale roadway projects, the program encountered a number of challenges from its inception. We asked the US 290 Program Office about the challenges and how the collective team worked together to overcome them. Our interview follows.

TP: What challenges did TxDOT encounter under each of the below-listed aspects of the 290 Program? What did the collective team (TxDOT, PMC, other contractors) do to address them?

Start-up When the Federal Highway Administration granted the Record of Decision in 2010, funding challenges prevented construction of the ultimate concept. To overcome this challenge, TxDOT and Harris County worked together in 2012 to implement an interim managed lane solution within the environmentally cleared footprint of US 290, deferring the construction of the Hempstead Tollway. Resources and agency responsibility were ultimately reallocated and the recommended US 290 interim configuration changed. Harris County discontinued their engagement in the managed lanes partnership and reduced their funding commitment in 2014. So, TxDOT developed an alternative proposed revised lane configuration that complied with the FHWA guidelines and TxDOT safety requirements.

Right-of-way acquisition also was a challenge, due to construction funding obligations that resulted in the majority of the projects being let for construction before ROW acquisition

was completed. A variety of mitigation efforts were implemented to avoid delaying the contractors, including letting the construction projects with delay clauses, prioritizing parcels for ROW acquisition based on construction phasing and revising construction phasing to optimize work within the existing ROW.

Design The changing program funding situation meant two major design changes from the original Final Environmental Impact Statement configuration, with the majority of the design revisions occurring after the projects were bid for construction. The first funding scenario included implementation of the interim three-lane managed lane concept per the TxDOT/Harris County partnership. The second design revision included implementation of the proposed revised lane configuration of a one-lane reversible High Occupancy Vehicle concept. TxDOT and the program management consultant coordinated the design revisions with the section design consultants to seamlessly implement the changes and avoid construction impacts.

US 290 Program Management | Houston, Texas

4 HNTB | Transportation Point | Winter 2017

Construction Utility relocation is a challenge in itself, but the challenge was made greater as ROW was, in some cases, being acquired after the construction contracts were awarded. With approximately 38 miles of US 290 under construction at the same time multiple other large corridor construction projects were being built in the Houston area, utility company resources were constrained. In addition to prioritizing ROW acquisition based on construction phasing, TxDOT worked with the contractors and the utility companies to prioritize utility relocations within the US 290 corridor. The TxDOT Houston District held regular meetings with the utility companies to coordinate utility relocations both within the US 290 corridor and within the region.

TxDOT uses project construction milestone incentives in design-bid-build projects to encourage contractors to complete the work efficiently. Almost all US 290 projects contain contract milestone incentives.

TxDOT had a significant construction challenge when it defaulted one of the contractors in 2015 due to not meeting the terms of the construction contract. TxDOT worked with the surety on the contractor replacement and then worked closely with the new contractor to revise construction phasing to minimize impacts to the construction schedule.

The program consists of 13 individual construction projects; due to initial funding assumptions, each project was designed as a stand-alone project. The actual construction funding resulted in acceleration of some of the projects by as much as 20 years. This resulted in concurrent construction of the entire 38 miles of the US 290 corridor, requiring TxDOT to coordinate mainlane construction phasing, exit/entrance ramp construction between

projects and, in some cases, requiring coordination between contractors on adjacent construction projects.

TP: How did technology play a role in this work?

The ProjectWise document storage system has allowed the storage of a large amount of data, which continues to grow. GIS and 3-D animation technology has helped TxDOT and the PMC on everything from ROW and noise-barrier maps, to animations of complicated program roadway interchanges.

Additionally, the program website has proven to be an invaluable source of program information, allowing stakeholders to view maps and animations of the proposed program improvements and also allowing them to email questions or comments they have about program construction.

Through the website, stakeholders can subscribe to email closure updates published by TxDOT.

TP: Were there other aspects of the program that didn’t present challenges, per se, but to which TxDOT gave special attention? Why were these areas important, and how did you address them?

We established a database of all corridor businesses. TxDOT understands the implications of construction on businesses along the corridor. From the beginning, one of TxDOT’s priorities was keeping corridor businesses updated on construction and being available to answer any questions or comments. To implement regular communication with the businesses along the corridor, TxDOT and the PMC started by developing a database of all corridor businesses. We held monthly business meetings open to

From the beginning, one of TxDOT’s priorities was keeping corridor businesses

updated on construction.

HNTB | Transportation Point | Winter 2017 5

owners and tenants from the entire corridor, with TxDOT construction project managers in attendance and available to answer questions regarding construction status, provide advance notice of significant roadway closures or traffic switches and discuss the business owners’ specific construction questions.

We adapted to the changing funding situation. The ability to adapt quickly to changing funding situations has been a critical aspect of the US 290 Program; funding has changed multiple times since the initial Record of Decision. Texas voters’ passage of Proposition 12 in 2007, followed by Proposition 1 in 2014, provided funding that significantly accelerated construction of the US 290 corridor. Throughout all of these changes, TxDOT and the PMC were able to adapt the US 290 design plans within the environmental clearance, capitalize on available funding and implement interim solutions that can be incorporated into the long-term, ultimate vision for the US 290 / Hempstead Corridor.

TP: From a public involvement standpoint, how did the relationship assist in providing strategies to convey changing messages to the public?

Co-location of TxDOT with the other disciplines allowed for quick feedback. The PMC was able to assist with messaging strategies and the material

to support them, review those strategies and materials, then distribute those materials to the public in a timely fashion.

Additionally, staff collaborated more frequently with design, construction, ROW and utility PMC members that also were in that same office. When someone had a question for the public involvement team that required input from those disciplines, their representatives were on hand and able to provide quick feedback.

Finally, the location of the program office made it relatively easy for stakeholders to visit in person with their questions, as the office is on the corridor itself at the major I-610/US 290 interchange.

TP: Based on the broader 290 project, are there any big-picture best practices or approaches you would recommend to other agencies who may face similar challenges in comparably sized programs?

The PMC configuration allows client and consultant to be in constant contact with each other. This allows for timely exchange of ideas and addressing any challenges that may occur. Client needs are made very clear, and there is little room for any misunderstanding. This facilitates the partnership between client and consultant, which is necessary for a project of this or any size to succeed.

The ability to adapt quickly to a changing environment is critical. The US 290 Program has seen multiple changes in funding, required revisions to construction sequencing due to both acceleration of construction funding as well as ROW challenges, and the replacement of a contractor. TxDOT and the PMC worked together to solve these challenges to keep construction moving forward. n

ABOUT US 290 ABOUT TxDOTmy290.com txdot.com

Co-location of TxDOT with the other disciplines allowed for quick feedback.

U.S. 290 Program Management | Houston, Texas

6 HNTB | Transportation Point | Winter 2017

Hiring an ally Determining which projects call for a PMCTransportation infrastructure projects’ growing complexity and scope can be overwhelming for owners, who must deliver increasingly multi-faceted results with less money, shorter schedules and limited in-house staff. Under these constraints, new programs can be delayed and construction costs can increase. As a result, governmental and community stakeholders often demand greater accountability and efficiency.

These challenges have driven the shift to mainstream adoption of a program management approach. Program management services are called by many names, owner’s representative, GEC, extension of staff and PM/CM to name a few, but at its core the project owner partners with an outside consulting firm to define, develop and manage the delivery of a major capital improvement program, consisting of either a single, large project or multiple projects. Now the fastest-growing strategy in the United States for managing the delivery of complex programs, program management/construction management revenues more than doubled — to $19.21 billion in 2012 — from their level of $8.71 billion in 2006, according to Engineering News-Record.

A program management consultant often brings a depth and breadth of experience from across the country, provides best practices gleaned from managing similar programs and supplements the owner’s existing staff. In addition to integrating systematic policies that help sustain program momentum, the PMC assesses risks and helps the owner take advantage of economies of scale and other efficiencies.

When to use a program management consultantIndustry professionals define program management in different ways, but most would agree project management and program

management are separate roles and require unique skill sets. I think of it like this:

Owners may need project management support when the expectations of the work and the outcome are straight forward, the project has a defined budget, familiar delivery method, secured funding, standard practices and has experienced staff to deliver.

If, on the other hand, the project is sophisticated and not clearly defined at the outset, the owner agency may benefit from retaining program management expertise. At its core, program management seeks to improve efficiencies, minimize risk, address issues before they become problems and save time and money — all for the specific purpose of making sure the owner’s vision of success is achieved.

The right PMC will bring relevant, scalable expertise in planning, design, construction and management that helps set the project parameters and — taking into consideration the owner’s goals, as well as the expectations of stakeholders and the public — establish what a successful project looks like for the owner agency.

1. The project has limited or no funding at all. Often, an owner’s No. 1 project question is, “How will we pay for it?” While a program manager does not serve as an owner’s financial advisor, a PMC can recommend innovative funding and financing strategies and, when needed, help navigate the appropriations and authorization process with local, state and national elected officials as well as assess private financing options. A PMC also should be able to offer customizable financial tools that allow owners to effectively address life-cycle cost needs and manage the cost throughout the project with multiple funding sources.

David Downs, PENational Program/Construction

Management Practice Leader HNTB Corporation

HNTB | Transportation Point | Winter 2017 7

2. Stakeholders expect delivery of a massive, complex program under a tight timeline. Hiring a PMC gives owner agencies access to more than just added manpower. A PMC can contribute extensive experience in multiple disciplines, adding expertise in funding and financing options, alternative delivery methods and technological and innovative solutions, among others. This network of experts helps owners ramp up quickly, yielding huge benefits in speed of delivery and cost savings.

3. The project may call for an alternative delivery method. For many years, traditional design-bid-build was the standard for delivering all sizes of projects. As project proportions have expanded and available funding has shrunk, however, alternative delivery methods — particularly design-build, public-private partnerships and CM@Risk — have gained momentum. As an owner’s program delivery partner, a PMC helps strategize the most advantageous delivery approach, drawing on both the owner’s desired outcomes and the program manager’s experience with other owners. One area of great value a PMC can provide is managing the procurement and oversight of design-build contractors and developers. This includes how best to address project risks by developing the best commercial and technical provisions and administrative procedures because the PMC often has the experience of managing these contracts through ribbon cutting, thereby gaining tremendous lessons learned and best practices as a result.

4. The program includes multiple projects in different stages of development. An agency with several concurrent projects needs the right skill sets at the right times in the process. For example, the North Texas Tollway Authority has more than 300 lane miles of roadways under construction or in the planning stages within the seven-county Dallas-Fort Worth metro. A key need for the Authority is to know exactly where the

schedule and budget stand on each project. The PMC worked with Authority staff to create a budget-schedule forecast that quickly explains where the $1 billion program is today and looks ahead to where the program will be when completed.

With access to first-hand experience from around the country, a program management consultant draws on relationships with experts who can provide relevant, timely insights and solutions. That translates into better performance from all participants throughout the life of the project and, at the end, higher quality in the final product. A PMC with a

broad range of experience also knows what did — and didn’t — go well on previous work and contributes that knowledge to each new program.

5. The owner will benefit from aggressive risk management. Large, complex capital programs carry significant risk potential. Not surprisingly, owners frequently rely on PMCs to help identify, prioritize and aggressively manage project risks that could impact the overall program schedule, budget and success. With this information in hand, the PMC then can proactively attend to project risks, developing work plans to eliminate and reduce

With access to first-hand experience from around the country, a program management consultant draws on relationships with experts who can provide relevant, timely insights and solutions.

8 HNTB | Transportation Point | Winter 2017

risk, define necessary project time and cost contingencies and address risk fairly between owner and contractor partners.

6. The project must meet exacting expectations for quality and value. Stakeholder and public expectations have increased along with growing project scopes, challenging owners to deliver high-quality, high-value results with fewer resources and under more aggressive schedules than ever before. As a partner and ally in achieving the owner agency’s project vision, and with an understanding of the unique political, economic and cultural dynamics that affect the project, a PMC will coordinate effectively with sister agencies to minimize end-user disruptions and ensure the project delivers the greatest value. By understanding conditions “on the ground,” the PMC can manage public communications and identify and resolve potential issues before they become problems.

The greatest potential risk in any large, highly visible program is to the agency’s reputation. Despite its name, program management is more than management; it involves a concerted focus

on achieving the successful outcomes on which the owner’s reputation hinges. Effective program managers have the means and methods to proactively ensure the project stays on the surest course to success, recognizing that failure is not an option. Expert program management builds agency credibility and stakeholder confidence that set the stage for future programs.

Ultimately, the more ambitious and complex the program is, the greater the opportunity for a PMC to provide efficiencies, quality and day-to-day confidence of success. n

ABOUT THE AUTHORDavid Downs is the National Program/Construction Management Practice Leader for HNTB Corporation. He is an expert in program management consulting and innovative project delivery and has led the delivery of more than $12 billion in projects using alternative delivery. He has assisted numerous owners with developing and delivering their first innovative delivery projects; developing and implementing project delivery strategies and defining organizational structures and processes to deliver highly visible projects and infrastructure improvement programs successfully. Contact him at (303) 910-6403 or ddowns@hntb.com

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Effective program managers have the means and methods to proactively ensure the project

stays on the surest course to success.

HNTB | Transportation Point | Winter 2017 9

The Kansas Department of Transportation recently opened to traffic a nearly $300 million high-profile expansion and rehabilitation project called the Johnson County Gateway, a highly traveled corridor and interchange located southwest of downtown Kansas City. It was the department’s first major design-build project and included the construction of 27 new or rehabilitated bridges, 68 retaining walls and 56 new lane miles. It took 32 months to reach construction completion with the final ribbon cutting occurring in November 2016.

Transportation Point spoke with Paul Gripka, KDOT Project Director for the Johnson County Gateway, and Carmen Bakarich, KDOT Attorney/Manager of Contract Claims, about the management of this complex project, which was supported by a program management consultant. The interview follows:

TP: What were the primary reasons KDOT chose to work with a PMC on the Gateway Project?

Mr. Gripka: This was a high-profile project as KDOT’s first major design-build project and with improvements to one of the busiest interchanges in the state. KDOT wanted to make sure the project was successful so KDOT could get legislation for future design-build projects. KDOT also had cutbacks in staffing and needed a PMC to serve as an extension of the agency’s staff for this major project. Staff reported that the PMC brought in best practices and lessons learned from a similar project in Utah, which assisted in helping to meet aggressive deadlines, tight budgets and high expectations.

Ms. Bakarich: This is KDOT’s first major design-build project and the Department’s largest project to date with a $288 million fixed-price and double the cost of its largest design-bid-build project to date. Having virtually no design-build experience, KDOT solicited the services of a PMC to help the department learn about and obtain success with this procurement method. This project’s

success will likely determine whether KDOT personnel, the Kansas legislature, and KDOT’s contracting partners support future design-build projects.

TP: We understand the project director for KDOT changed during the course of the work. In what ways did having a PMC partner impact KDOT’s ability to effectively manage the project during this transition?

Mr. Gripka: Because I came into the project mid-stream, it helped me to have a PMC with knowledge of what happened before I came to the project. The PMC was able to tell me what was successful and what wasn’t successful, especially in terms of traffic impacts. The PMC had the knowledge to help me make quick and informed decisions on approvals to keep the schedule on track during the transition and avoid delays to the Design-Builder.

Ms. Bakarich: The PMC’s knowledge helped the agency maintain consistency. For instance,

KDOT leverages PMC during first major design-build project in state32-month project completed on schedule

Johnson County Gateway Interchange | Johnson County, Kansas

10 HNTB | Transportation Point | Winter 2017

when the Design-Builder sought variances from bridge shoulder requirements, the PMC knew why the original project director had allowed or denied variances previously. During this project, KDOT also lost the Department’s utility coordinator. Because of KDOT’s confidence in the PMC’s utility coordinator and support services manager, KDOT allowed the PMC to administer the remaining utility work.

TP: What recommendations did the PMC make to support the intense schedule or otherwise improve the project?

Mr. Gripka: The PMC made recommendations on contract processes, design changes, paving and construction phasing. When we were reconstructing K-10, I was concerned with traffic backing up at the I-435/I-35 Interchange and wanted a 10-day full closure on the system-to-system ramp rather than a 30-day partial closure. The PMC worked with the Design-Builder to route traffic to city streets and suggested ramp work at the interchange also be done to save time and eliminate a temporary crossover.

Ms. Bakarich: The PMC made significant recommendations in design and construction. To avoid a design exception for a reduced stopping sight distance and design speed on a system ramp, the PMC proposed design modifications to the adjacent slopes and roadway. At one point, the Design-Builder was behind schedule and the existing schedule had multiple traffic configuration changes on I-435 over a short period of time. The PMC proposed schedule changes that reduced the number of traffic switches and that prompted the Design-Builder to further modify the schedule and advance work on two other interchanges, achieving early partial completion on one of them. The PMC’s recommendations created win-win situations for KDOT, the Design-Builder, key business stakeholders, local public authorities and the traveling public.

TP: One key factor in this program was managing the complex utility identification and relocation in the region. Tell us more about this process.

Ms. Bakarich: KDOT had three major steps for managing the project’s utility work — subsurface utility engineering, master utility agreements, and contract administration. SUE investigation documented 32 utilities

and 125 miles of existing utility facilities. Pre-procurement, KDOT discovered most of these utilities were unfamiliar with design-build and uncomfortable contracting with an unknown Design-Builder. To preserve its utility relationships, KDOT entered into MUAs with the utilities. There were 19 MUAs on the project which were incorporated into the design-build contract. The Design-Builder was obligated to avoid relocations; minimize costs; coordinate the utility work design, construction, and scheduling; and prepare supplemental agreements for utility work design and construction. All parties had input into the utility design and construction for consistency and compatibility with project design, construction and schedule. The MUA identified potential relocations, but the Design-Builder had the final decision regarding the utility work needed for its project design. The MUA encouraged work by the Design-Builder so the Design-Builder had more schedule control. The third step in managing the utility work was contract administration. Even with the Design-Builder coordinating physical work and processing supplemental agreements, KDOT had a full-time PMC utility coordinator and a KDOT utility coordinator to coordinate, review, and document utility work and utility payments and coordinate conflict resolution.

Mr. Gripka: The PMC’s management of complex utility identification and relocation was critical to timeline success. The PMC assisted the Design-Builder and the utility companies. To avoid utility delays, we had a good process in place where we identified the utilities early on and put the responsibility on the Design-Builder to coordinate with the utilities. If we wouldn’t have coordinated the utility work ahead of time, the aggressive schedule would have been compromised and we would have had claims.

TP: Based on your experience, what advice or key takeaways would you offer other DOTs which may assist in deciding whether they should work with a PMC or which may assist them in working with a PMC?

Mr. Gripka: DOTs just starting with Design-Build should use a PMC. Most DOTs know if they have the time and internal resources to devote to Design-Build. If they don’t have the resources, then a PMC can serve as an extension of the agency staff for a program.

Even with sufficient agency personnel, a PMC with knowledge of the process is still critical to project success. The DOT should use the PMC to identify contract provisions and express agreement or disagreement with the Design-Builder’s proposals but still understand that it is the owner’s call.

Ms. Bakarich: At the outset, the DOT needs to communicate its corporate culture and expectations to the PMC; contract format and administration should be governed by the department’s culture, not just the project goals to be accomplished. The DOT also should encourage the PMC to make suggestions for improving the specifications and processes at all phases of the project (ITP, RFP and contract). In our project, the PMC was initially reluctant to share information in the one-on-one meetings presumably concerned that its suggestions would stifle innovation by the proposers and create legal liability. These concerns can be managed by discussions with the PMC, contract provisions and team building in one-on-one meetings.

The DOT wants an involved PMC but needs to create an environment that shows the DOT is the owner of the project. Here, the PMC’s involvement in preliminary design and contract

drafting generated a sense of project ownership for the PMC, which contributed to the PMC’s many positive suggestions. To overcome any concerns with decision making, the DOT should have as many department personnel on the project as possible, have senior staff at partnering and/or monthly progress meetings, and implement team building and task force meetings that foster a cooperative environment rather than a competitive environment between the DOT, PMC and Design-Builder. n

ABOUT THE AUTHORSPaul Gripka is a professional engineer with the Kansas Department of Transportation. Paul has been with KDOT since 1991 and is currently serving as the Gateway Project Director. Over his career Paul has primarily inspected projects and then administered construction contracts for KDOT in the Kansas City metropolitan area. Contact him at (816) 289-0154 or paul.gripka@ks.gov.

Carmen Bakarich is a Staff Attorney and the Manager of Contract Claims with the Kansas Department of Transportation. Carmen has been with KDOT since 1991 and serves as senior legal counsel responsible for contract administration and claims management on department construction, engineering, railroad-highway and utility contracts. Contact her at (785) 296-7139 or carmen.bakarich@ks.gov.

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