Pavement Type Selection (Designs, Costs & Bidding)

1. Pavement Type Selection(Designs, Costs & Bidding) 9th Annual Concrete Conference for the Maryland Transportation Industry March 24, 2009 Timonium, MD Presented by Bob Long American Concrete Pavement Association Mid-Atlantic Chapter

2. Pavement Type Selection Evolution of the Process • Good old days • More responsible • More structured • Let the market dictate

3. Pavement Type Selection Typical Basic Components • Equivalent designs • Cost estimates • Life Cycle Cost Analysis (LCCA) • Innovative Contracting (e.g., alternate bids)

4. Same structural capacity • Similar traffic-carrying capacity over the analysis period • Provide reasonably similar level of service • Designed with the same procedure Equivalent Designs What are equivalent sections? • Traffic • Reliability • Subgrade • Terminal Condition • Traffic • Reliability • Subgrade • Terminal Condition =

5. Different Pavement Types Concrete Section Asphalt Section Asphalt Layer Subbase Base Subgrade Subbase Subgrade

6. 3000 kg. 3000 kg. pressure < 0.2 MPa pressure » 2.0 MPa How Pavements Carry Loads Concrete’s Rigidness spreads the load over a large area and keeps pressures on the subgrade low.

7. Costs • Accurate estimates are essential • Take into account volume, production, and availability of materials • Update regularly

8. Costs • Liquid AC index jumped from $340 to $842 per ton in just over 4 months (April—August 2009) – that’s a $25 per ton increase for in-place asphalt pavement • Availability of liquid AC was becoming a concern • Over the last 2 years, the price of asphalt pavement has jumped from about $55 to over $75 and as high as $130 per ton • Although cement prices did rise for a while before the big AC increases, prices are lower and stable

9. Materials Costs

10. Life-Cycle Cost Analysis What is it ? • Economic procedure • That uses Engineering inputs • Compares competing alternates over their life • by considering all significant costs (and benefits) • Construction, Maintenance, Rehabilitation • User • Performance • Expressed in equivalent dollars

11. Pavement A Pavement A - Rehabilitation Schedule Determine the stream of flow for expenditures. The cash flow diagram (below) shows the inflow and outflow of cash due to construction and rehabilitation. Arrows indicate a major cash expenditure (construction, rehabilitation, etc.). An up arrow indicates the outflow of cash. Down arrows show inflows. With pavements the inflow of cash only occurs at the end of the analysis period to show either continued-use or salvage value. The height of the arrow indicates the magnitude of the expenditure. 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 Pavement A - Present Worth Calculation Using the the expenditure stream above, calculate the Present Worth (PW) for each rehabilitation activity (PW for the initial cost is the initial cost). PW is calculated using the following formula: n PW = Rehab Cost / (1+i) Where i = discount rate n = year rehab takes place Discount Rate = Yr Cost (1+i)^n PW Initial Const.. 0 1.000 Rehab 1. Rehab 2. Rehab 3. Rehab 4. Rehab 5. Rehab 6. Rehab7. Rehab 8. Rehab 9. Rehab 10. Salvage Total Cost Total NPV Life-Cycle Cost Analysis What it is Not • A Magical Black Box • There is no concrete LCCA or asphalt LCCA • Complicated • Does not need a computer program

12. Life-Cycle Cost Analysis How it is done: • Present Worth Analysis (PW) • Equivalent Uniform Annual Cost Analysis (EUAC)

13. Initial Cost Rehabilitation Cost Maintenance Cost Salvage Value Present Worth Costs Years Life-Cycle Cost Analysis Present Worth Analysis:Discounts all future costs (benefits) to the present Costs Years

14. Life-Cycle Cost Analysis Basic Factors: • Economic Factors • Discount rate • Analysis Period • Engineering Factors • Comparable sections • Rehabilitation selection • Agency Costs • User costs

15. Life-Cycle Cost Analysis Analysis Period: • Normally equal for each alternative • Highway: 30-50 years • Street: 20-30 years • Airport: 30 years • Include at least one rehabilitation • Needed to capture the true economic benefit of each alternate

16. Life-Cycle Cost Analysis User Costs: • Delay-of-use • Time delays - New construction & Rehabilitation • Fuel consumption • Driver discomfort • Roadway deterioration • Cargo damage • Vehicle wear • Accidents

17. Life-Cycle Cost Analysis Some basic insights: • Initial Costs • Account for about 65-90% of Life Cycle Cost. • Selection of features plays an important role • Need to account for added features on the pavement performance. • Timing of Activities. • After initial costs and discount rate, the next most important factor. • The longer an activity is delayed, the greater it is discounted and the less impact it has on present worth.

18. Pavement Type SelectionOverview of Maryland Process • Policy on application of process • Three tiered approach • Life cycle cost comparison • Component analysis • Innovative contracting • Probabilistic approach to LCC • Weighting of component factors based on project priorities • Project team formed to make final decision

19. Application Policy • All projects developed through the Project Planning Division ready for design, and • Any projects with a construction estimate > $15 million (with at least $5 million dedicated to pavement/MOT items) • Estimated to be 6 to 8 projects per year. (Staff resource levels were a limiting factor in the number of projects that could be identified.)

20. 1st Tier – LCC Analysis within 20% • Initial Cost • Future Rehab Costs over 40 Years • User Delay Costs 2nd Tier – Component Analysis • Cost Factors • Construction Factors • Design & Environment Factors • Form Team and Consider Industry Input 3rd Tier – Innovative Contracting • Alternate Bidding • Warranty Contract • Design/Build Contact Three Tiered Approach

21. Life Cycle Cost Factors • Based on historical data and expert opinion • Material unit costs • Pavement service life • Construction sequencing • Construction duration • General analysis inputs • Variability represented by average and standard deviation

22. Example Input – Service Life

23. Component Analysis • Cost Factors • Present worth Agency Costs – Initial & Future • Present worth User Delay Costs • Construction Factors • Duration of Construction • Maintenance of Traffic • Maintenance of Access • (utilities & future maint, material sources, reliability of construction) • Design and Environment Factors • Traffic and Geometry • Adjacent Pavement and Structures • Environmental Impact • (community concerns, future planning)

24. Project Level PTST • Chief Engineer for MDSHA Operations. • District Engineer of MDSHA District that project resides. • Director of Highway Development (OHD) for MDSHA. • Director of Materials & Technology (OMT) for MDSHA. • Pavement Division Chief of OMT for MDSHA.

25. Example Component Score

26. Component Matrix

27. Alternate Pavement Bidding Alternate pavement bidding involves the bidding of two equivalent pavement designs in order to determine the most economical solution to the owner.

28. Use of Alternate Bidding • FHWA traditionally discouraged use of alternate bids for pavements • FHWA approved a Special Experimental Project for use of alternate bids in Missouri 1996. • AASHTO recognizes Alternate Bids as a contracting technique that will be utilized in the 21st century • Recommended when more than one alternate is judged “equal” by an agency and that the least costly design approach will result from a competitive bid. • Alternate bidding should be used when there is no clear cut choice between two alternates and have similar life cycle costs

29. Use of Alternate Bidding • Federal Aid policy suggests that alternative designs are considered for large projects • A life cycle cost economic analysis should be conducted to compare the total cost of each alternate. • If the alternates do not provide equivalent designs then an adjustment must be made to the bid to equate the alternates. • Pavements should be bid in the same units and materials costs escalators should not be used.

30. Use of Alternate Bidding • The following States/Provinces have experience with alternative bidding: • Alabama • Kansas • Kentucky • Louisiana • Maryland • Michigan • Missouri • Ohio • Pennsylvania • West Virginia

31. Alternate Pavement Bidding Account for Bid Adjustment Method • A + B • A + B + C • C is usually a product of the following example: C = User Delay Cost + (periodic) Rehab Cost + Annual Maintenance Cost C is added to the actual bid amount

32. West Virginia’s Alternate Bids • Three projects so far with 3 more coming this year • No C factor so far • First project went asphalt • Next two went concrete with the concrete bid 10% less than asphalt • WV is getting the lowest unit prices for asphalt they seen in years

33. Available Software • AASHTO DARWIN design • WinPAS (ACPA’s Windows version of DARWIN) • Mechanistic Empirical Pavement Design Guide (MEPGD – coming soon) • RealCosts (LCCA) • Concrete Pavement Analyst (NRMCA parking lot design and cost analysis program)

34. THANK YOU! www.midatlantic.pavement.com www.pavement.com