Bundling and Drop Kicking

Ok, this next little bit is not really covered in the TDOT local programs manual, in any FHWA regulations, or anywhere written that I have ever seen. It is less about how to do a project, and more about the strategy involved in getting the most bang for your buck out of your Federal funding.

Ok, so you are a city and you have some STP funds to play with, lets say $400,000.00 Federal. So if we do a resurfacing project where the reimbursement is 80% (you spend $100, we pay you back for $80) we have enough money to do a $500k total cost project.

For the sake of simplicity lets say there is no Right of Way (ROW) involved. Lets figure $15k for Preliminary Engineering (PE) for the environmental document (NEPA), and $15k for PE for the final design plans (these are just round figures, each project is different). You will need about $20k for the construction engineering inspections (CEI) and maybe another $5k for TDOT’s oversight of the project.

Again, these are just round numbers and can very easily change either way. So out of a $500,000 project, you have about  $445,000 to spend on actual construction.

Now you can find one stretch of road from point A to point B that is in serious need of resurfacing . Now keep in mind, the whole process, even on a simple resurfacing project can take around a year from when you start your conversation with the Local Programs office, till the contractors are on site working. With that in mind, some big questions loom out there.

  • What is the price of asphalt going to be next year?
  • What are we going to do if the price goes through the roof, and we can’t afford to pave the whole thing?
  • What happens if it goes way down? How could we add more road to the project to spend all of our money?

Unless you have a second project in the works, your goal should probably be to spend your funds all in one fell swoop on this project. You don’t want it to over run, because your city is on the hook for 100% project after your STP balance is exhausted. But you also don’t want to leave money on the table either.

One possible solution (and one that we do a lot), is instead of having just one road segment for resurfacing we have 5 or more (or less). By road segments I mean parts of one road, or separate roads on the other end of town all together.

This way we can do everything we need on each one of these 5 road segments (NEPA, Plans, Permits, ROW, Utilities,Bid book, estimates certification, ect). This is where you can bundle several resurfacing projects into one project. The price for the PE on adding another section is pretty small.

So if the price for doing all 5 is too much when we get close to bidding them out, you can drop kick one or two of the road segments off if need be.

This way if you get additional Federal funding some time in the future you can quickly get the funding obligated for the remaining road sections that you dropped earlier since all the work has already been done on them and just needs to be updated.

This may sound tricky, but it is not. By having multiple road segments for the whole project, this gives you lots of flexibility to make sure you get full use of your funds. I hope this helps if you are thinking of getting a project together.


About arran375

I work for Askew, Hargraves, Harcourt and Associates, Inc. here in Nashville, Tennessee. The short version of what I do is that we help local governments spend the Federal funds they get from TDOT on road, and bridge projects.
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