Greater Use of Value Engineering Has the Potential To Save the Department of Transportation Millions in Construction Costs

RCED-85-14: Published: Nov 2, 1984. Publicly Released: Nov 2, 1984.

Additional Materials:

Contact:

Sarah F. Jaggar
(202) 275-1000
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

GAO discussed the potential of value engineering (VE) to reduce costs and the extent that it is currently used in Department of Transportation (DOT) administrations with major construction programs.

GAO found that, although DOT does not have a policy requiring that VE be used in its construction programs, two of its administrations use this method to a limited extent. DOT believes that VE can produce savings, but it has not required its use mainly because it believes that VE may negatively affect other DOT objectives, such as providing grantees maximum flexibility to implement construction programs. GAO concluded that a flexible VE policy would be consistent with DOT objectives.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In October 1985, DOT established a VE review committee from engineering and policy staffs of DOT headquarters, FAA, FHwA, UMTA, and the Coast Guard. It developed a DOT Order on use of VE in DOT, which was issued on April 13, 1987.

    Recommendation: The Secretary of Transportation should establish and implement a policy to require FHwA, FAA, FRA, and UMTA to supplement their normal cost-reduction procedures for construction programs with a VE program. The policy should be flexible enough to recognize and address the operating differences among the administrations. In establishing a policy, the Secretary should require that follow-up procedures be established to ensure that approved VE recommendations are implemented.

    Agency Affected: Department of Transportation

  2. Status: Closed - Implemented

    Comments: In October 1985, DOT established a VE review committee from engineering and policy staffs of DOT headquarters, FAA, FHwA, UMTA, and the Coast Guard. It developed a DOT Order on use of VE in DOT, which was issued on April 13, 1987.

    Recommendation: The Secretary of Transportation should establish and implement a policy to require FHwA, FAA, FRA, and UMTA to supplement their normal cost-reduction procedures for construction programs with a VE program. The policy should be flexible enough to recognize and address the operating differences among the administrations. In establishing a policy, the Secretary should require that VE be performed either by qualified administration officials or by private firms.

    Agency Affected: Department of Transportation

  3. Status: Closed - Implemented

    Comments: In October 1985, DOT established a VE review committee from engineering and policy staffs of DOT headquarters, FAA, FHwA, UMTA, and the Coast Guard. It developed a DOT Order on use of VE in DOT, which was issued on April 13, 1987.

    Recommendation: The Secretary of Transportation should establish and implement a policy to require FHwA, FAA, FRA, and UMTA to supplement their normal cost-reduction procedures for construction programs with a VE program. The policy should be flexible enough to recognize and address the operating differences among the administrations. In establishing a policy, the Secretary should require that VE be performed in accordance with generally accepted VE principles, including the use of a multidisciplined team and a VE job plan.

    Agency Affected: Department of Transportation

  4. Status: Closed - Implemented

    Comments: In October 1985, DOT established a VE review committee from engineering and policy staffs of DOT headquarters, FAA, FHwA, UMTA, and the Coast Guard. It developed a DOT Order on use of VE in DOT, which was issued on April 13, 1987.

    Recommendation: The Secretary of Transportation should establish and implement a policy to require FHwA, FAA, FRA, and UMTA to supplement their normal cost-reduction procedures for construction programs with a VE program. The policy should be flexible enough to recognize and address the operating differences among the administrations. In establishing the policy, the Secretary should require that VE be performed during the early stage of project design.

    Agency Affected: Department of Transportation

  5. Status: Closed - Implemented

    Comments: In October 1985, DOT established a VE review committee from engineering and policy staffs of DOT headquarters, FAA, FHwA, UMTA, and the Coast Guard. It developed a DOT Order on use of VE by DOT agencies and grantees, which was issued on April 13, 1987.

    Recommendation: The Secretary of Transportation should establish and implement a policy to require the Federal Highway Administration (FHwA), the Federal Aviation Administration (FAA), the Federal Railroad Administration (FRA), and the Urban Mass Transportation Administration (UMTA) to supplement their normal cost-reduction procedures for construction programs with a VE program. The policy should be flexible enough to recognize and address the operating differences among the administrations. In establishing the policy, the Secretary should require that criteria, such as a certain dollar threshold, for selecting projects to be valued engineered be established by the FAA, FHwA, and UMTA administrators.

    Agency Affected: Department of Transportation

  6. Status: Closed - Implemented

    Comments: In October 1985, DOT established a VE review committee from engineering and policy staffs of DOT headquarters, FAA, FHwA, UMTA, and the Coast Guard. It developed a DOT Order on the use of VE in DOT, which was issued on April 13, 1987.

    Recommendation: The Secretary of Transportation should establish and implement a policy to require FHwA, FAA, FRA, and UMTA to supplement their normal cost-reduction procedures for construction programs with a VE program. The policy should be flexible enough to recognize and address the operating differences among the administrations. In establishing a policy, the Secretary should require that a full-time VE program staff be appointed at the department level.

    Agency Affected: Department of Transportation

 

Explore the full database of GAO's Open Recommendations »

Sep 14, 2016

Sep 2, 2016

Aug 8, 2016

Jul 28, 2016

Jul 13, 2016

Jul 7, 2016

Jun 24, 2016

Jun 21, 2016

May 26, 2016

Looking for more? Browse all our products here