Modeling and Analyzing Cost Overruns, Delays, and Cancellations in Senate Bill 1 Projects

Research Lead: Michael Hyland

UC Campus(es): UC Irvine

Problem Statement: Accurate estimates of infrastructure project costs, duration, and risks are critical in making informed decisions that can significantly impact quality of life in California. Caltrans’ preliminary examination of progress reports for projects that have been funded by the Road Repair and Accountability Act of 2017, commonly referred to as Senate Bill 1 (SB 1), reveals severe underestimates in project costs and timetables. Notably, these occurred even before the COVID pandemic. Few projects are expected to finish under budget or before the estimated completion date.

Project Description: This project examines the difference between initial SB 1 project cost and duration estimates in grant applications with the actual costs and completion times using publicly available data from SB 1 progress reports to identify the types of projects that are more likely to underestimate outcomes. Specifically, the research looked at which phases of a project are more prone to cost escalations and delays for different project types, infrastructure programs, and geographic locations. Results show consistent patterns of overruns associated with fiscal periods, programs, and geographic locations. In addition, results indicate that the common 20% contingency is generally insufficient, indicating the need for better risk estimation in project planning.

Status: In Progress

Budget: $100,000