Lanterna Rally

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Published: 2014

Total Pages: 70

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The Michigan Department of Transportation (MDOT) has been using monetary incentive payments for many years to accelerate highway construction work, resulting in reduced delays to the traveling public. It was envisioned that incentive/disincentive (I/D) payments/penalties would capture the true cost (user delay savings vs. actual I/D dollars) and would have positive impacts on the long-term pavement performance by extending its expected life. Therefore, MDOT sponsored this research study to determine whether the I/D for expediting construction captures the true cost and identify its impacts on the long-term pavement performance for projects that have been expedited vs. conventional scheduling. The analyzed data statistically supports an improvement in the long term project performance for the incentive projects. Also, identified data suggests a trend that incentive clauses accelerate project schedules. Additionally, data analysis statistically supports the idea that incentive clauses increase project cost but further analysis finds that the avoided user delay was higher than the additional paid cost for some incentive clauses. The analysis results highlight the effectiveness of Accepted for Traffic and Interim Completion incentive/ Disincentive clauses; they also debate the effectiveness of the lane rental incentive/ disincentive clauses, in achieving their goal by accelerating project schedules and reducing user delay cost. Also, the report calls for little modification to the listed "Advantages and Disadvantages" and "Recommendations for Use" of each acceleration technique in the 2013 MDOT Innovative Construction Contracting document.