Part 3: COVID-19 and Transportation Construction: Long-term Impacts
by Paul Schmitz, on Jun 19, 2020 2:00:00 PM
As we start to adjust to our new circumstances caused by COVID-19, companies operating in the transportation construction sector must also plan for long-term impacts. How will new regulations and business practices affect the future of construction? Could there be major shifts in operations that last long after the pandemic subsides? We asked our panel representing top engineering and construction firms, suppliers, state agencies and associations to share their perspectives.
With the need for improved social and workplace safety nets, what will be the long-term impact to infrastructure costs due to the pandemic?
- Bill Lawrence – (Materials Manager – Utah Department of Transportation) My perspective as the Materials and Pavements Director - Our construction program continues to function and move forward. Though the way business is being handled is different, there are some instances it is a bit less efficient, while others have shown to be more efficient, such as teleworking.
- Randell Iwasaki– (Executive Director - Contra Costa Transportation Authority) Currently, the long-range look is that infrastructure costs will have lower prices due to the historically low prices for crude oil. The new SIP orders require redundant positions, but eventually the construction safety officers will be trained and receive the correct certifications to deal with COVID-19 and future pandemics. We are concerned about the health and safety of our contractors’ employees. It takes skilled labor to build our bridges and highways. If they get sick and there aren’t enough employees working, it will delay our projects and raise the cost of building the infrastructure. This is why we partner with our contractors to help them to keep their employees healthy and safe.
- Michael Mangione (Senior Vice President – WSP USA) The impacts will be varied and wide-reaching. There will be additional costs for PPE, space requirements, workflows and processes. The market will need to determine where these costs will be carried. As there will be additional safety and operational processes in both design offices and construction sites, there will likely be a reduction of productivity, which will in turn result in longer project completion duration. In the nearer term, in states where construction shut downs have occurred, clients are likely facing delay claims by contractors. Lastly, if there are future waves of infection, there are likely impacts if members of a construction crew or office staff are infected (quarantine durations, schedule impacts and contractual terms).
- James Bailey (Senior Vice President – Skanska USA Civil) The construction industry is generally quick to adapt to new safety standards, after initial resistance, i.e. the new silica standards. The biggest struggle adapting to the CVD-19, was/is the ability procure the required PPE and supplies. We will certainly see an increased cost to purchasing safety supplies and requirements to sanitize tools/equipment/areas, but I believe we will overcome productivity related impacts due to CVD-19 in the long term.
- Scott Edgecombe – President, Americas – Tensar) In theory, costs should go up to account for necessary safety nets. The costs associated to ensure worker safety through and beyond COVID-19 are still evolving as are improved processes that could help offset those cost increases.
- Nick DiBartolo (Vice President – Rogers Group, Inc.) There are obviously costs involved in modifying how we do business, but not all of those are increases. Take telecommuting for example: the reduction in travel expense can help offset some of the increases related to expanded industrial hygiene. In the short term, owners will likely see a discount, as raw material supply and labor looks for a place to go; long term, if some businesses fail to survive, owner costs will increase. Ensuring that construction remains designated as essential and getting, as close as practical, to a full economic reopening will be key to keep construction inflation in check.
What short-term and long-term changes do you envision will result from the pandemic related to the following?
Construction Process and Safety:
- Ananth Prasad (President – Florida Transportation Builders Association) In the short term, continue with the CDC guidelines. From an on-going basis, we found out that some of the meetings can be done virtually.
- Ken Simonson (Chief Economist – The Associated General Contractors of America – AGC) More safety/sanitation/PPE use onsite. Possibly fewer onsite workers at any time, possibly more use of offsite manufacturing, but the same barriers still exist and it is not clear factories will be able to attract/train workers or have the flexibility to supply diverse project needs.
- Nick Goldstein (VP of Regulatory Affairs – American Road & Transportation Builders of America – ARTBA) There are positive outcomes resulting from the pandemic, and those include a heightened awareness of health risks that can arise from every day working conditions. We’ve learned we can and should do more to protect our health, whether those are health pathogens or hazardous chemicals or other contaminants. The required use of face coverings has helped workers better overcome resistance to wearing such PPE, and the consequences for not doing so are more acute and real. The other lesson learned is that we need to be more aware of the health hazards we may acquire at work and then take home to our families. The lessons associated with COVID-19 help us better understand the need to clean our clothing and PPE so we don’t bring contaminated items into our homes.
Engineering & Design:
- Mark Lindemann (Geotechnical Engineer - Nebraska Department of Transportation) Recently we have been moved to all digital/ paperless plans and submittals which has helped eliminate the need for mail and in-person deliveries. We expect more staff to telework in after CVD-19 at least part time.
- Scott Edgecombe (President Americas – Tensar) With state and local budgets in disarray, innovation and cost-savings will drive many designs. Products and methods that can save up-front costs, provide construction efficiency, improve longevity and resiliency should gain preference with designers.
- Michael Mangione (Senior Vice President – WSP USA) Long-term changes to engineering and design include increases in remote work and rethinking of office space requirements; the need for changes in approach to modeling traffic demand; new appreciation for freight movement; potential bridge loading increases as deliveries become more frequent and important; mode-shift impacts due to transit public health/safety perceptions. States with reduced revenues may take back planned engineering/design work to perform inhouse.
- Jeff Lackey (Vice President – TranSystems, Inc.) In our organization, we have found some real efficiencies in the work from home environment. I see that increasing as we emerge from this pandemic. I also believe video conferencing and virtual meetings becoming more of the norm as we go forward.
- Randell Iwasaki – (Executive Director - Contra Costa Transportation Authority) I think that emerging methods of mobility will create more of an impact in the engineering & design industry than responding to a pandemic. The E&D industry has migrated to remote work sites in the past and are well set up to deal with the current work environment. Similarly, we have a program to reduce paper at our agency, and construction management firms that work with us are required to go paperless by utilizing modern software and hardware to be more efficient. They can inspect one aspect of a project on one end of a project and monitor compaction of the asphalt paving process on the other end utilizing our software and hardware requirements.
Permitting and Approval:
- Nick Goldstein (Vice President of Regulatory Affairs – American Road & Transportation Builders Association – ARTBA) For construction work and transportation improvements to have a maximize impact on economic recovery a new urgency to complete project reviews and approval will be needed. At the same time, regulations which cause unnecessary delay without providing corresponding societal benefits should be repealed.
- Nick DiBartolo (Vice President – Rogers Group, Inc.) We've already seen public hearings being held by video, teleconference and webinar. While I think the public will still demand some sort of in-person forum, much of the process could be handled through these channels.
- David Lawry (Past APWA President and Director of Municipal Services for Chastain & Associates) Wet signatures will no longer be required allowing greater flexibility with permit issuance. Legal requirements will have to be adjusted in many cases to allow this change and benefit.
- Randell Iwasaki – (Executive Director - Contra Costa Transportation Authority) For the short term, we are asking for relief of the environmental process on projects that have very limiting restrictions (e.g. only being able to access part of a project site for a few months of the year). In the long term, I believe that permitting and approval will either need to be relaxed or become more flexible to adapt to a new work environment designed to accommodate expedient delivery of infrastructure projects – which generate economic activity.
We thank this week’s panelists for offering their insights and outlooks on the future of transportation construction. Next week we will tackle the topic of funding for both public and private transportation construction.
Continue to Part 4: The Future of Funding
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