Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Project Delivery Costs topic
No spam. Unsubscribe anytime.
Contractors tell lawmakers inflation, regulatory reviews and scope creep drive overruns on mega projects
Summary
Contractors and county directors told a legislative oversight committee that nationwide construction‑cost inflation, extended permitting and third‑party requirements, and frequent scope changes drive cost growth on large transportation projects; they urged clearer scope, appropriate contingencies and streamlined contract review.
Contractors and county road directors warned lawmakers that modern delivery for large transportation projects carries many built‑in cost pressures beyond raw material prices.
Ken Kabacki, vice president and Northwest regional manager at Sunt Construction, said national construction inflation and the expansion of project scope over decade‑long delivery windows often blow initial budgets. "You've got to have that initial scope. That first budget is critical," he said, urging realistic contingencies and procurement choices that match project complexity.
Con O'Connor, president of Hamilton Construction, said the largest cost drivers are third‑party and regulatory requirements that lengthen schedules and impose new onsite controls — from fish‑species containment and water treatment to extended seasonal work windows. He noted a recent bid example where a bridge that cost $3.6 million in 1999 had a modern comparable bid around $62 million, reflecting many new requirements and market changes.
Panel members and legislators also discussed contract management. Contractors argued that some states let DOT project teams manage work with counsel in advisory roles rather than routing every change through legal review; that, they asserted, reduces delay and cost. Several committee members asked staff to compile an indexed list of regulatory burdens that increase building costs in Oregon.
Next steps: Committee asked for statutory references and an inventory of regulatory and contractual steps that add time and cost; members suggested follow‑up hearings focused on mega‑project overruns such as the I‑5 Bridge replacement.
