Design-build typically
eliminates competitive bidding, allows contractors
to inspect their own work, and in every instance in
California has greatly increased project delivery
costs. In recent years, four
design-build projects have wasted $2.2 billion in
transportation funds without expediting project
deliver in California.
Nevertheless, ten state highway
design-build projects were approved by the state
legislature as part of the February 2009 state
budget compromise. The Legislature and
Caltrans must ensure that those projects go forward
with appropriate public agency involvement as
required in the authorizing legislation.
Design-Build: A Failure in California
To date, design-build
transportation projects in California have been a
failure for taxpayers and commuters.
Here are a few examples:
SR 22 (Garden Grove Freeway).
Orange County Transportation Authority’s
design-build project to build twelve miles of
car-pool lanes on SR 22 was to have been completed
and open in 2006, but work continued into 2011.
Since the decision was made to use
design-build for the project, the cost increased
from $271 million to $606 million!
Charges of unfairness in the design-build
procurement process have been documented. In
an April 2004 story on the SR 22 design-build
project, the Orange County Register found
“earlier this year two construction firms dropped
out of the selection process, partly because of
concerns of fairness.” In a
letter to OTVA about the design-build contracting
procedure, the Vice-President of one of those firms
wrote, “it is our conviction that it is a process
far more subjective than it appears.”
SR 73 (San Joaquin Hill
Tollway). According to the
Los Angeles Times, on November 10, 2005, the SR
73 design-build tollway required a $1.16 billion
bailout package by Orange
County
officials. The $1.5 billion
design-build tollway opened in 1995 and has been
“plagued by lower-than-projected traffic and
revenue.” Without the bailout, SR
73 would have been in technical default on $1.9
billion in bonds as early as July 2006.
