Project 3.20: Analysis of MaineDOT Road and Bridge Infrastructure Construction Costs

February 7, 2022

Analysis of MaineDOT Road and Bridge Infrastructure Construction Costs

Project 3.20

Project Information
Downloadable Documents

Project Summary

Maine Department of Transportation (MaineDOT) has been experiencing increasing costs in bids received for bridge repair, road paving and other infrastructure construction projects. This was first observed for bridges in the Fall of 2018 and paving in the spring 2019. Moreover, for projects with single bidders, the bids are 30-40% higher than the MaineDOT’s internal cost estimates. These cost increases appear to be greater than those in the neighboring states of Vermont and New Hampshire. This research seeks to evaluate the impact of inflation on these significant bid increases and better understand cost drivers for higher than estimated construction projects for MaineDOT before and after the current pandemic conditions. Possible cost drivers include: Maine’s labor force, steel tariffs, supply side disruptions due to the COVID pandemic, changes in federal trucking regulations, Maine’s recreational cannabis laws, and environmental regulations.

Principal Investigator

Dr. Jonathan Rubin

Co-PIs

Dr. Erin Brown
Dr. Peter O’Brien

Institution:

University of Maine

Project Status

Completed

Project Cost

$25,000

Start Date

02/07/2022

Project Type

Base-Funded

End Date

08/15/2022

Agency ID

69A3551847101

Sponsors:

MaineDOT

Implementation of Research Outcomes:

Combining lack of competition between bids for high-value projects with general inflationary pressures, supply chain delays, labor availability, and associated added risks, the MaineDOT and its contractors are facing serious barriers to completing highway and bridge projects in a timely and affordable manner. Considering all cost drivers, our analysis provides support to MaineDOT’s observations of a general increase in construction costs of approximately 40% across most of its construction project types from 2018 to present, though individual project complexity, size and timing matter significantly.

Impacts and Benefits of Implementation:

State engineers should expect any given project cost to be well above levels seen for comparable work prior to 2020. Moving forward, we believe the key to incentivizing lower bid offer amounts is to reduce perceived risk and uncertainty for firms.

Printable Project Information Sheet

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