Contractors Working 24/7 to Rebuild Houston Highways

Bonus Incentives Help Speed Construction

Fast-paced schedules mean contractors must remain ambitious and stay on target in order to receive bonus incentives and avoid penalties on two major Houston-area TxDOT projects with combined contracts totaling more than $1.6 billion.

By Eileen Schwartz

Providing relief to commuters was the top priority when the Texas Department of Transportation began to plan for the reconstruction of the section of Houston's IH-610 Loop known as the West Loop, located in the city's tony Uptown neighborhood. The reconstruction of the West Loop encompasses nearly a five-mile stretch, from US 59 (Southwest Freeway) to IH-10 (Katy Freeway), where it connects with another major project, the Katy Freeway reconstruction. Together, the two projects will not only relieve congestion for motorists, they are also generating a mind-boggling amount work and revenue for Texas highway contractors.

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The $225 million West Loop reconstruction project, with an overall completion date of 2007, includes the renovation of existing roadway, the addition of new entrances and exits and the creation of so-called hot links, which are designed to provide exclusive access into and out of the area while removing traffic from main lanes. Houston-based Williams Brothers Construction Co. was awarded the project's three prime contracts: The IH-610/U.S. 59 interchange, which is nearly complete; IH-610 from U.S. 59 to Post Oak Boulevard, which is scheduled to be completed late next year; and IH-610 from Post Oak Boulevard to the IH-10 interchange where the project overlaps with the $1.4 billion Katy Freeway reconstruction.

The West Loop's new roads, combined with other regional and local mobility improvements, will provide motorists with more lanes and more choices, according to Uptown Houston, a local county-improvement district dedicated to infrastructure improvements that has partnered with TxDOT on the project. The goal of the partnership is to make the area one of Houston's most accessible and convenient locations in the city. "While plans will ultimately result in a 25 percent increase in lane miles, the capacity for more automobiles and better movement will ease congestion at well-known bottlenecks, particularly the interchanges at the IH-610/U.S. 59 and IH-610/IH-10," said Janelle Gbur, director of public information for TxDOT's Houston District.

The Katy Freeway project, which broke ground in June of last year and is scheduled for completion in early 2009, is one of the largest highway construction projects in the state's history and the first in the nation to convert a portion of an interstate highway into toll lanes. The job involves the reconstruction of approximately 23 miles of IH-10 and approximately two miles of IH-610 including the IH-10/IH-610 interchange. Of the nine contracts on that project, Williams Brothers was awarded two, including the IH-610/IH-10 interchange for $263 million, the largest single-project dollar amount ever let by TxDOT. Of that amount, about $135 million is included in the West Loop project cost.

To ensure that quality work is completed rapidly, TxDOT has instituted a financial incentive/disincentive program for general contractors for each of the three West Loop projects. Contractors receive a bonus for each day they complete work on a major milestone ahead of schedule and are penalized a similar amount for every day a project is behind. "Whenever a major milestone is completed, an incentive is earned. There is an equal disincentive if they go beyond the amount of days allowed for a major milestone. In addition, they will also be assessed liquidated damages if they go beyond the total days of the contract," Gbur said. "The high-incentive contracting rewards the contractors if they meet deadlines and severely punishes them if they do not," she added.

The incentive program enabled Williams Brothers to work seven days a week around the clock to complete ramp work on the IH-610/U.S. 59 interchange in less than 10 months, 67 days ahead of schedule. "One of the best things TxDOT has ever done is to provide an incentive bonus, which in turn provides a cost reimbursement for the increased expense of 24/7 construction required for fast completion," said Doug Pitcock, president of Williams Brothers.

The company is currently working at a similar pace to complete the IH-610/IH-10 interchange, which is used by more than 500,000 vehicles per day. The maximum incentive amount for early completion of the contract is $11.7 million, while disincentives, including liquidated damages, could cost the company anywhere from $5,000 to $75,000 per day in penalties.

The fast-tracked job, with a contract of $263 million, is about six months into a 51-month schedule. "If you break it down, that's about $5 million per month of work to complete per month," said Clifford Halvorsen, Central Houston area engineer for TxDOT. "That's a lot of work. On a typical job, $1 or $2 million a month is a lot of work."

While the size of crews and duration of work necessary to meet the project's deadline is about three times that of a typical job, the interchange work is essentially a typical urban job being done at a rapid pace, Halvorsen said. "Were not doing anything differently as far as construction than we've done on other jobs," he added.

Before construction could get underway, utilities running under IH-610 had to be relocated. The process had to begin about a year prior to groundbreaking. Since then the same utilities have been discovered at a different location but still in conflict with the project and had to be moved again. "Then you're faced with a situation where, on a normal job, you have time to relocate." Halvorsen said. "On a fast-track job the window of opportunity is not there, and that can be a real set back."

Because of the job's proximity to the popular Galleria area, TxDOT has agreed to leave as many entrance/exits of the existing interchange open for as long as possible. "On the West Loop we've been allowed to shut down more entrance and exit ramps, and on similar jobs we'd normally shut down half of the entrance/exits," Halvorsen said. "But because of the area's significance and commerce, we're not allowed to do that." He added that there will eventually be short closures of 20-40 day durations.