We could learn a few things from our cousins in Canada about designing and building infrastructure. The White House infrastructure plan depends on it, relying on using limited federal dollars to leverage state, local and private investment.
Canada faced similar challenges in the 1990s and turned to P3 projects, shorthand for public-private partnerships. A Canadian P3 project for roads and bridges doesn’t necessarily mean tolls, and it goes beyond design and construction to include maintenance. It’s a whole life cycle approach to infrastructure.
The primary attraction is paying for the design and construction over the life of the asset instead of upfront, based on performance criteria. If a road is contracted to perform for 20 years, and the pavement goes bad in 15 years, taxpayers are not on the hook. Think of it like buying a house with a 20-year fixed rate and a really good warranty.
Private lenders look at the payback terms, whether the government uses taxes or tolls for revenue. And they dig deeply into the design-builder’s qualifications to seek best value, not just lowest bid. Major Canadian projects start with a “value for money” analysis to decide whether a P3 or traditional bid process is best for each situation.
P3s have become the norm in most of the developed world as an important tool in addressing the ubiquitous backlog of infrastructure repairs as well as new investments within tight budgets.
Seeking greater value for the money, Canada also adopted the One-for-One Rule for red tape reduction in 2012 and repealed its version of federal prevailing wage rules, the Fair Wages and Hours of Labour Regulations, in 2013.
We could also learn a few lessons from our experience in Washington on how to leverage more project for the same money.
When the Skagit River Bridge collapsed in 2013, it cut off the Interstate 5 artery linking the U.S. to Canada. Replacing it had to happen fast. Bellevue-based Atkinson Construction had the debris removed and a temporary span in place in less than a month. Spokane-based Max J. Kuney Co. designed and built the replacement span in three months with streamlined permitting from state and federal agencies. Total replace time from collapse to reopening was just under thirteen months.
The initial proposal preparation was compressed from three months to two weeks. After being awarded the job, the final design required additional pilings in the river. “Normally, trying to get additional piling into an environmentally sensitive river ranges from very difficult to impossible, and can take considerable time. On Skagit, it was approved in 24 hours,” said Max Kuney, company president.
The Trump administration’s recently released “Legislative Outline for Rebuilding Infrastructure in America” recognizes time is money. Cheryl Stewart, executive director of the Inland Northwest Associated General Contractors, described it as a “great starting point for a truly bipartisan solution to this incredibly important issue.”
“One aspect we will be focusing on is regulatory reform – we want to ensure our tax dollars are spent on building roads and bridges, not red tape,” she said.
Stewart forwarded a link to the INAGC’s flowchart of all the steps it takes to obtain permits on a typical project. Printed out, it covers a 60-by-60-inch surface, and it’s still hard to read. It’s more of a churning mud puddle than a flowchart. “EPA Director Scott Pruitt has a copy of this on the wall in his office for inspiration,” Stewart said. “It’s a great reminder of how much time and money is wasted on redundancy in our federal government.”
One commonly proposed change to reduce the cost of major infrastructure is a repeal of federal and state prevailing wage laws, but it may not be worth arguing over in the short term. In the current labor market, Kuney says they are less of a factor, and “wages today are primarily driven by the market.” With so many leaving the construction industry through retirement, “the amount of work that needs to be done in the next several years will challenge the industry, both companies and workforce, to deliver it all.”
Good roads, safe drinking water and bridges that don’t fall down are not partisan issues. Maybe we could adopt Canadians’ iconic civility for this debate as well as their infrastructure model, eh?
Columnist Sue Lani Madsen can be reached at email@example.com.
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