The recession has enabled the California Dept. of Transportation to save approximately $2.4 billion in construction costs for major projects since 2006 due to strong competition. Some bids are coming in at 40% below engineers’ estimates, says Kris Kuhl, supervising transportation engineer and official chief for contract awards and services at Caltrans.
Overall, Kuhl says that so far this fiscal year, project bids are averaging 33.8% under estimates.
The savings, obviously, means that Caltrans can push for more transportation construction starts, Kuhl adds.
“Depending on the nature of the work, we also are seeing a record number of bidders,” he says. “The large projects will have a smaller bidding pool, but some of the other smaller, repair projects can get as many as 30 bidders.”
For example, the $1-billion Doyle Drive project in San Francisco is seeing bids coming in 40% (for contract 3, recently won by Rancho Cordova-based C.C. Myers Inc. from a pool of eight bidders) and 41% (for contract 4, won by R&L Brosamer Inc., Walnut Creek, also with a pool of eight bidders), Kuhl says.
The other major San Francisco Bay Area transportation project, the fourth bore for the Caldecott Tunnel in the east bay, was a cost and time bid with the boring phase estimated at $215 million. Winning bidder Tudor Saliba Inc., Sylmar, came in 20% under and bid 1,105 days, which was 21% under estimate.
With the economy slowly recovering, Kuhl says he expects the bidding environment to return to normal soon, but can’t say exactly when. “There are now signs that the bids are getting closer to estimates,” he says. “And although there may be fewer bidders during the very busy spring season, the fact is we have a lot of work out there already, which is good for employment.”