Hartsfield-Jackson News

DEVELOPMENT PROGRAM

Construction Spending Sends Costs Skyward
By DeAllous Smith

Higher construction prices are impacting the costs of many projects at the world's busiest airport.

Severe weather patterns, increasing fuel costs, increased construction opportunities around Atlanta, increased competition for qualified workers, expedited projects and security constraints each play a part in the unexpected rising costs.

In December 2005, Hartsfield-Jackson Atlanta International Airport advertised the replacement of Runway 8R-26L, one of the Airport's most ambitious projects.

At the time, the engineers estimated the total design and build-out costs to be around $80 million.

When the proposals were received, only three of five pre-qualified contractors specializing in this area submitted proposals. While the lowest bid was under the estimated $80 million, it was the second lowest bidder that is being recommended as the "most responsive and responsible" bidder for the project, therefore causing the project to come in over the estimated cost.

The higher than anticipated bid meant aviation officials had to adjust internal budgets and will appeal to Atlanta City Council members for permission to move forward with the project.

Many qualified contractors are currently assisting with the rebuilding efforts of cities and towns along the Gulf Coast area, which were destroyed as a result of Hurricane Katrina's furry in August 2005.

Meanwhile other contractors are bidding on highway projects such as those offered by the Georgia Department of Transportation, or commercial projects in blossoming communities such as Atlantic Station, Buckhead, Midtown and the Stonecrest area.

"There is definitely a shortage of experienced labor compared to the number of opportunities and contractors to pick from in today's industry," said Assistant Director of Engineering Ted Allen. "However, the City of Atlanta has an open and fair bidding process, which allows us to select from a well-rounded pool of applicants with qualified and diversified backgrounds."

The reduction of resources due to Hurricane Katrina added to the construction boom across the nation has transcended into higher construction costs at Hartsfield-Jackson and other expanding facilities.

"Providing excellent customer service while ensuring both safety and security is extremely important at the Airport," added Allen. "We definitely want to provide an opportunity for any potentially qualified bidder to submit a proposal, however it's equally important to ensure that the job is completed in a safe and efficient manner for the passengers and employees operating at the Airport."

Another construction project affected by rising costs was Taxiway Victor, a new end-and-around taxiway, around the western end of Runway 8R approach.

Bids for this project were received less than a week after Hurricane Katrina. The engineers estimated the cost of the taxiway project at $30 million; however the proposals received ranged from $37.6 million to $45.8 million.

Security restrictions and increasing passenger volumes at the world's busiest airport mean that contractors are restricted to operational time frames during certain projects.

Some projects are required to work at off-peak or night hours to minimize impacts to the customer.

All projects are reviewed individually and granted operational times based on the level of complexity, impact on operations and location. Although the facility is open 24 hours a day, aviation officials noted that it is very difficult to replace a runway while working between midnight and 6 a.m.

"Hartsfield-Jackson averaged over 2,600 daily flight operations in 2005 and we anticipate that number to rise to 3,400 by 2015; therefore, we must insert guidelines that will not impact operations or inconvenience our customers," added Allen.

Only two years ago, the cost to reconstruct portions of taxiways F and L was more in line with the Airport's estimates.

In early 2004, Hartsfield-Jackson advertised the replacement of portions of Taxiways F and L with an engineer's estimate of $31 million. The winning bid was awarded to a qualified contractor at a cost to Hartsfield-Jackson of $25 million.