Driverless Vehicles: Profound Changes in Store for Transportation Infrastructure

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Since the invention of the automobile, transportation infrastructure has been evolving as fast as the vehicles themselves. From the dirt paths of horse and buggy days up to the creation of superhighways between major cities for modern automobiles, transportation infrastructure is continuing to experience a design revolution. Recently, auto manufacturers have been pushing forward the concept of driverless vehicle prototypes for consumers, which will encourage the advancement of the transportation infrastructure to support it.

Google and university-affiliated research centers are working on fully autonomous technology for vehicles that would be able to drive between two locations without any operation by the occupant.

Such driverless vehicles would especially benefit persons with physical disabilities who are not currently able to operate a vehicle, as well as fleet operators, heavy equipment users, and the military, according to the May-June 2013 issue of The American Road & Transportation Builders Association (ARTBA)’s Transportation Builder magazine.

With an estimated 1.25 million annual fatal vehicle accidents occurring around the world, safety is another incentive for the new technology. The change would mean fewer crashes caused by human error, as well as the opportunity to increase highway capacity (more cars on the road) due to less physical gap between vehicles, greater residential and commercial development density along highway corridors, improved walking and biking options, smaller parking lots, and a shift in the design of office parks and strip malls.

The development process is advancing; however, it has not yet focused on the infrastructure that will ultimately be required to support this change in technology.  Understanding the issues and thinking outside the box will give infrastructure experts a decided advantage as this moves forward.

There is potentially room for transportation consultants to redesign and repurpose all parts of the highway system, including improving existing visual elements, such as lane markings, so driverless vehicle technology works more effectively. Other opportunities for work will involve gathering real-time data of work zones, congestion spots, weather, and passing vehicles, which will be collected and distributed electronically to improve the technology. Furthermore, cities that embrace this new technology will attract a greater share of new businesses and residents, contributing to their economic development.

Rejection of Bids

_banners92When awarded a public contract, the invitation to bid (IFB) requires the contractor’s bid to be responsive to the material requirements of the bid. An article recently published by Better Roads magazine examines the issues associated with the Federal Highway Administration’s (FHWA) position on rejecting a contractor’s bid for what might appear to be a “minor” deviation from the requirements of the IFB.

As the article states, minor deviations may be waived, though material deviations may not. The failure to properly complete a bid form is a material deviation justifying rejection of a bid as non-responsive. Similarly, the failure to acknowledge amendments to an IFB, or submit a complete and unqualified bid form, is considered nonresponsive.

However, minor informalities (of form and not substance) can be corrected without prejudice to other bidders and can be waived at the owner’s discretion.  The key test is whether the bidder can be held to perform after taking into consideration all bid deviations so there would not be a competitive advantage over the bidders.

In the example of Massillon Construction and Supply, Inc., the Comptroller General (CG) denied and the protest of road contractor, Massillon (MCSI), finding its bid was non-responsive because it failed to submit a separate price for optional work as required by the IFB.

The FHWA solicited bids to rehabilitate approximately six miles of New Found Gap Road in the Great Smoky Mountains National Park, Tennessee, divided into three schedules of work. Bidders were required to submit prices for each contract line item. Prior to the bid opening, the FHWA amended the IFB to add a third option for intelligent compaction (IC), coring and coordination with respect to a portion of the first part of scheduled work. In addition, the amendment included new a new pricing page, requiring entry of a lump sum price for the added option, therefore requiring a new summary page that added a line for all of the schedules and the sum total.

Because MCSI did not receive the amendment in its entirety due to fax machine issues, the contractor’s total bid price was the lowest received by bid opening, and the bid ended up being rejected as non-responsive because it did not include prices for all of the scheduled of work.

MCSI filed a protest with FHWA asserting its bid was in fact responsive because it merely acknowledged the amendment. MCSI argued its price for the first schedule included pricing for the last and additional schedule of work, and further argued FHWA could waive the omission of the specific schedule price for the last item’s price as minor informality.  After submitting a revised bid schedule, FHWA denied its protest and MCSI protected to the CG.

In sum, the CG found the mere acknowledgement without a price is insufficient to constitute a bid since doubt exists as to the amount of the bid and the bidder’s obligation to perform the increased work. The CG also found that MCSI’s explanation that its price was included in a different line item was inadequate since nothing established the price for the last schedule added. The CG stated that MCSI’s nonresponsive bid could not be made responsive by explanations after bid opening, since doing so would effectively allow the bidder to elect whether to accept or reject the additional work.

In the end, MCSI’s failure to include a specific price for the last schedule resulted in their bid protest to be denied. Moving forward, it’s important to distinguish minor deviations versus material deviation when receiving invitations to bid to ensure issues such as these do not occur. The full article can be read here.

Transportation Funding Challenges

In recent years, the uncertainty regarding federal funding for transportation has continued to rise. This pressure to keep funding for transportation stable has caused some states to implement other solutions. States such as Wyoming, Virginia, Maryland, and Vermont are increasing their excise or sales taxes on fuel in an effort to boost revenue for transportation needs. This newfound movement could prompt other states to follow suit through the willingness on the part of lawmakers to raise taxes related to transportation.

In an article recently published by Civil Engineering magazine, the authors examine why the funding for transportation has declined. It’s no surprise that because of the difficult economic conditions in recent years, many states have faced a series of challenges regarding transportation funding, including chronic gaps between investment needs and outlays, a growing need for transportation services, and less revenue from gas prices as motorists switch to vehicles offering greater fuel efficiency. As the article states, these factors combined have put states in a real bind, in terms of paying for their transportation needs.

Another contributing reason why transportation funding has become an issue is because of the stopgap of funding from legislation (known as the MAP-21 law) that occurred between the years of 2009 to 2012, therefore complicating efforts by the states to conduct long-range planning.  MAP-21 will provide stable funding through the fiscal year of 2014, but after that any certainty for states begins to fade.

Therefore, states are seeking to boost the transportation funding they receive from the federal government. The federal program has some stability right now in terms of being able to fund at the MAP-21 levels through the end of the next fiscal year.  However, there is a lot of uncertainty about how to keep the program going thereafter, so states are focusing on ways to go above and beyond what they can expect to receive from the federal government.

An example of this is shown as Wyoming has increased its taxes on gasoline and diesel fuels by 10 cents per gallon. The state has also enforced a law which also increases taxes on snowmobiles, off-road vehicles, and motorboats, which is expected to generate nearly $72 million additional revenue for the Wyoming Department of Transportation.

As other states have moved forward with enacting legislation to vamp their approach to funding transportation infrastructure, leadership by governors has proved crucial in increasing the overall goal in expanding transportation funding. As we examine our own state’s revenues dedicated toward transportation funding, following the examples led by Wyoming and other states could be necessary. The full article, “Transportation Funding Challenges Prompt States to Consider Gas, Sale Tax Increases” can be read in its entirety in the June 2013 issue of Civil Engineering magazine.

Mobile Computing: Wield Desktop-Grade Power in the Palm of Your Hands

smartphone and tabletSmartphones and tablets are not just used for electronic communications, accessing media, or surfing the Internet anymore. These are also among a new generation of business tools, enhanced by Cloud-based business applications that enable accurate recording of data in the field and 24/7 collaboration among employees.

In a recent issue of Engineering Inc. magazine, the “Mobile Power” article described the current climate and proposed future of mobile computing in the engineering industry. The key driver of mobile technology in the engineering industry is the ability to bring a smartphone or multimedia-rich tablet onto a job site, even a sewer if necessary, to observe and record data in real-time, while still fresh in the engineer’s mind. Remote staff greatly benefit from mobile field information management software and consulting services. Technology gives engineers the ability to download plans, designs, drawings, and graphics on site and make markups, as well as take high-res photos and video of projects.

A white paper recently published by American Structurepoint described how we’ve helped clients implement and deploy Microsoft Office 365 (Office 365), a desktop suite with Cloud-based versions of next-generation communications and collaboration services. Office 365 features Microsoft Exchange Online, Microsoft SharePoint® Online, and Microsoft LyncTM Online, which are delivered and accessed over the Internet (the Cloud). All the information storage, computation, and software is located and managed remotely on servers owned by Microsoft. Having this infrastructure online allows employees to access email, documents, contacts, and calendars virtually anywhere from a desktop, laptop, tablet, or mobile phone. By moving a company’s software and services off local machines and onto Microsoft-hosted servers, it is able to lower hardware overhead costs, decrease electricity costs, better predict IT budgets, and simplify IT system management. Read the free Office 365 white paper here.

It is evident the mobile work environment is a growing trend in business. However, firms are also concerned with keeping confidential business data safe when it comes to inviting employees to bring-your-own-device (BYOD) to work, a movement especially popular among small businesses. When employees bring their own smartphones and tablets to work, mobile device management solutions should be used. Forbes suggests these five BYOD tips:

  1. Make sure all devices are password protected.
  2. Do not store important corporate information on devices locally.
  3. Back up all servers and devices often.
  4. Allow applications to be downloaded from the Internet only if you can verify that the information is trustworthy and will not harm your network.
  5. Make sure all mobile devices, personal or company-owned, can be remotely wiped if they are compromised, lost or stolen.

Lastly, keep in mind that all employees using mobile technology should be properly trained, following company policies regarding the use of company-owned and employee-owned devices. Safety on site is another concern on the job. For example, employees operating machinery should be reminded to only use hands-free devices.

Read the May/June 2013 issue of Engineering Inc. here.

Three Percent Growth Rate Estimated for Water Market in 2013

While businesses in other industries may still be suffering due to the challenging economic climate over the last five years, the water/wastewater market has a projected three percent annual growth rate in 2013, according to the American Council of Engineering Companies’ bimonthly magazine, Engineering Inc. By 2016, FMI Corp. estimates a five percent annual growth rate for the water sector.

At the forefront driving this growth is the aging infrastructure across the US. The American Water Works Association estimates that one million miles of water and wastewater pipes are nearing the end of their useful life and will need to be replaced. Severe flooding and droughts have also affected the lifespan of this underground infrastructure. Another factor for the projected growth is the additional scope of services being offered by water utilities. Among these new services are reclaiming and reusing water, using “green” infrastructure to manage stormwater, and finding commercial uses for the nutrients in wastewater.

FMI estimates that funding for the water sector will reach $45 billion by 2016; however, the investment needed to fix the aging infrastructure is almost double that amount. Unfortunately, federal funding for water has decreased by 90 percent since the 1980s, according to Engineering Inc., totaling just $1.4 billion in available funds in 2013. Drinking water funds are only at around $908 million this year.

Legislative efforts to subsidize the gap between the need and the availability of funds will come from the House of Representatives, who is working to extend and double the monies allotted for the Clean Water State Revolving Fund (projected at $13.8 billion over the next five years), as well as other projects. USA Today also reports that monthly water utility rates for municipalities have increased by 75 percent since 2000, especially in larger cities, and funding from some private investors is also available.

Despite the challenges, engineering consulting firms will benefit from the growth of the water and wastewater market, especially by providing management consulting support for water utilities. Other opportunities for work include helping to create asset management plans to prioritize spending of water utilities’ limited budgets and introducing options for sustainable stormwater filtration of wastewater.

“For many of our clients, their existing utility infrastructure is reaching the end of its useful life. In many cases, this infrastructure has been in the ground 50 to 100 years without much being done to protect it.  This, with the tightening of regulatory compliance, has forced our industry to think broader when approaching a project,” says David Mohler, vice president of American Structurepoint’s Utility Infrastructure and Environmental Groups. “It is no longer about repairing a single section of sewer or water main, rather integrating the repair in to a larger project to kill multiple birds with one stone. It is about minimizing the impact on the rate payer, not just today, but for the life of the project.”

Read more of the May/June 2013 issue of Engineering Inc. here.

American Structurepoint Named Among Top Design Firms

Engineering News-Record (ENR) Midwest has once again recognized American Structurepoint on its list of the Midwest’s Top Design Firms. Of the firm’s $56.67 million regional revenue in 2012, 52 percent came from transportation projects, 20 percent from general building projects, and 12 percent from sewer/solid waste projects.

In addition, Architectural Record magazine has recognized American Structurepoint on its list of Top 300 Architectural Firms based on 2012 revenue of $8.20 million in architecture services.

For more information, view:

ENR Midwest’s 2013 Top Design Firms by Region 

ENR Midwest’s 2013 Top Design Firms by State

ENR’s 2013 Top 500 US Design Firms

Architectural Record’s 2013 Top 300 Architectural Firms

The Future Financial Picture for Firms

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In recent findings from the Deltek Clarity Architecture & Engineering Study, undertaken in association with The Association of Consulting Engineering Companies (ACEC), the study compared 2012 data on the four most important operating metrics for architecture/engineering firms and provided a perspective on just how quickly firms are recovering. Those four vital operating metrics included:

The net labor multiplier: The study finds a measure of markup on labor costs has been relatively flat over the past three years among surveyed firms, fluctuating between 2.85 and 2.95.

The utilization rate (also known as chargeability), which measures the percentage of total staff labor charged to projects. The study’s findings show that it rose in 2012 from 58.3 percent to 59.9 percent and now is up more than five percentage points since bottoming out two years ago. However, it was indicated there is still room for improvement, as it was at 63 percent in 2004.

The overhead rate dropped by more than ten percentage points last year from its peak in 2011. The Deltek-ACEC study stated the overhead is now at the lowest rate since the recession began. The key drivers here are increasing utilization, which decreases labor charged to overhead, and a continued focus on cost control. The overhead rate is calculated by dividing total overhead (before distributions) by total direct labor expense.

The fourth and final factor is the operating profit rate, which after reaching a decade low in 2009 at 8.35 percent, has continually and steadily risen to 10.13 percent during the last year.

As we examine these indicators for our own A/E firm, the results seem to indicate the recovery is slow but steady. This study was originally featured in Engineering Inc. magazine. The full article can be read here.