Report: Expanding One Law Could Save New Yorkers Billions on Infrastructure Redevelopment

NEW YORK, June 24, 2015 /PRNewswire-USNewswire/ -- A report released today by the Rudin Center for Transportation Policy and Management at New York University shows New York could save taxpayers billions of dollars simply by authorizing widespread use of Design-Build procurement practices on public infrastructure projects.

The report, sponsored by the Association for a Better New York (ABNY) and RBC Capital Markets, highlights the success of Design-Build projects throughout the country in addition to its successful implementations in New York, despite State law dictating that it can only be used on a limited basis. The report calls on Albany to expand the practice to save taxpayers money and shorten the completion time on critical infrastructure projects.

The report can be seen at: http://wagner.nyu.edu/rudincenter/2015/06/designbuild/.

Design-Build is a form of project delivery in which a public agency or private sector entity enters into a single contract for both design and construction of a project. Instead of separate teams designing and building the project – and having to bid separately for both phases – under Design-Build, one team handles the project from start to finish.

In March of this year, the New York State Legislature re-authorized five state agencies to use Design-Build – but that's it. A subsequent bill created to expand authorization of Design-Build procurement to other State agencies, New York City agencies, and local governments has not been approved in Albany.

"With New York's aging infrastructure, we are at a competitive disadvantage compared to nearly every other state. It is essential for our economy, our safety, and our wallets to effectively and efficiently complete these needed repairs and improvements," said Mitchell Moss, Henry Hart Rice Professor of Urban Policy & Planning at New York University. "When used appropriately, Design-Build can effectively lower project costs, reduce the time required to complete a project and encourage more innovation in design and construction. It is up to the New York State legislature to deliver for their constituents."

"Design-Build is a project delivery tool that would enable critical infrastructure projects to be delivered more efficiently," says Bill Goldstein, Senior Advisor to the Mayor for Recovery, Resiliency and Infrastructure. "Lowering costs and shortening project schedules will allow us to undertake more work which will, in turn, create more good paying jobs for New Yorkers. New York City presently cannot utilize this method which is available in 41 other states. We look forward to working with all parties to make design-build available to the City."

"It is clear that Design-Build offers a proven record of faster project delivery and for New York City this equals a cost savings of tens of millions of dollars, if not more," said NYC DOT Commissioner Polly Trottenberg. "New York City needs innovation to fix our roads, bridges and buildings, and Design-Build allows us the needed creativity and flexibility to get these projects done the right way."

The benefits of Design-Build procurement can be documented in projects across the country.

• Tappan Zee Bridge: The Design-Build construction of a new bridge will cost $1.7 billion less than projected and is expected to be completed 18 months ahead of schedule.
• Goethals Bridge: The Design-Build construction of a new bridge is projected to cost $1.5 billion, 10% less than its original estimate.
• Other New York Highways and Bridges: The New York State Department of Transportation has saved over $100 million by awarding Design-Build contracts on dozens of bridges and roads.
• Camp Pendleton: In California, the U.S. Navy authorized Design-Build procurement for the construction of a new hospital. It was completed six months ahead of schedule and $82 million under budget.
• I-35W St. Anthony Falls Bridge: In 2007, the I-35W St. Anthony Falls Bridge in Minnesota suddenly collapsed, killing 13 people. The Design-Build construction of a new bridge was completed three months earlier than projected and saved more than $50 million of taxpayer money.

While 41 states realize the benefits of Design-Build procurement, New York is one of the few states that have yet to fully implement. 

"The first duty of policy makers is to build and improve more infrastructure with existing resources. In many instances, Design-Build is a tool that helps accomplish just that," said Chris Hamel, Managing Director and Head of the Municipal Finance group at RBC Capital Markets. "The Rudin Center study documents the savings and demonstrates the advantages for the State to embrace and expand this important procurement technique, just as 41 other states have concluded already."

"Today's report highlights the compelling need for New York State to join with the rest of the nation in bringing our roads, tunnels and bridges into the 21^st century. Design-Build will ensure New York's place as a world economic leader while protecting New Yorker's tax dollars," said Bill Rudin, Chairman of the Association for a Better New York (ABNY).

About RBC Capital Markets
RBC Capital Markets is the corporate and investment banking arm of the Royal Bank of Canada. RBC Capital Markets is a premier investment bank that provides a focused set of products, services, and expertise to corporations, institutional investors and governments around the world. With over 7000 professionals in 15 countries, we deliver our products and services to clients in over 100 countries through operations across North America, Europe, and the Asia-Pacific region. For more information, please visit http://www.rbccm.com/.

About ABNY
The Association for a Better New York (ABNY) is a 44-year old civic advocacy organization that is dedicated to improving the quality of life for those that live and work in New York City and for those who visit. We bring together hundreds of the city's finest citizens and organizations in the joint commitment of addressing issues and finding solutions that enhance and highlight the best that New York has to offer, and we tirelessly work with the city, the state, and the federal governments, as well as with our business and civic members to achieve positive results for all of New York's communities. For more information, please visit https://www.abny.org/.

SOURCE RBC Capital Markets