ITS Maintenance Experience ITS Maintenance Experience in Michiganin Michigan

Gregory D. Krueger, P.E.Gregory D. Krueger, P.E.Metro Region Traffic and Safety EngineerMetro Region Traffic and Safety EngineerMichigan Department of TransportationMichigan Department of Transportation

BackgroundBackground

• Michigan ITS Michigan ITS originally deployed originally deployed in the 1970’sin the 1970’s

• Significant Significant expansion in 1995-expansion in 1995-19971997

• Continued Continued modernization over modernization over timetime

Current OperationsCurrent Operations

• Freeway Operations Freeway Operations CenterCenter

• 180 cameras180 cameras• 65 DMS65 DMS• 2000+ detectors2000+ detectors• Mixed-media Mixed-media

communicationscommunications• Links to partnersLinks to partners• No major upgrades No major upgrades

in past 10 yearsin past 10 years

Why Contract?Why Contract?

• MDOT’s overall program increased MDOT’s overall program increased approximately 100% in the past 13 approximately 100% in the past 13 years ($1.6B to $3.1B)years ($1.6B to $3.1B)

• MDOT’s staffing levels have fallen 27% MDOT’s staffing levels have fallen 27% in the past 13 years (3,868 to 2,826)in the past 13 years (3,868 to 2,826)

• MDOT is currently limited in the ability MDOT is currently limited in the ability to hire new staffto hire new staff

• MDOT currently has 2 staff members MDOT currently has 2 staff members doing maintenance of ITS facilitiesdoing maintenance of ITS facilities

Contract HistoryContract History

• Original system was maintained by in-house Original system was maintained by in-house staffstaff

• Expansion maintenance was part of original Expansion maintenance was part of original construction contractconstruction contract

• RFP in 2000 for maintenance of hardware and RFP in 2000 for maintenance of hardware and softwaresoftware

• Contract expired on March 26, 2004Contract expired on March 26, 2004• Currently using an interim maintenance Currently using an interim maintenance

providerprovider• Developing a new RFP for a long-term Developing a new RFP for a long-term

maintenance contract (3-5 years)maintenance contract (3-5 years)

Contract MechanismsContract Mechanisms

• Purchase Orders (small activities)Purchase Orders (small activities)

• Statewide, task order based general Statewide, task order based general contractscontracts

• Construction-type contracts (pay items)Construction-type contracts (pay items)

• Service-type contracts (time and Service-type contracts (time and materials)materials)

Payment OptionsPayment Options

• Pay for level of effort/number of staff Pay for level of effort/number of staff (assume X full-time people and pay (assume X full-time people and pay 100% of their time)100% of their time)

• Pay for equipment-days of service (the Pay for equipment-days of service (the CCTV must be operational 350 days per CCTV must be operational 350 days per year – OR – pay $X per day the CCTV is year – OR – pay $X per day the CCTV is operational)operational)

• Pay for work orderPay for work order

Pay for Level of EffortPay for Level of Effort

• No incentive to use No incentive to use staff efficientlystaff efficiently

• Easy to administerEasy to administer

Pay for Equipment Days of Pay for Equipment Days of ServiceService

• Simple to defineSimple to define• Incentive for Incentive for

effective use of staff effective use of staff hourshours

• Moderate Moderate complexity to complexity to administeradminister

Pay for Work OrderPay for Work Order

• Moderate complexity to define (due to Moderate complexity to define (due to overlapping pay items)overlapping pay items)

• Low to moderate incentive for effective Low to moderate incentive for effective use of staffuse of staff

• Difficult and time consuming to Difficult and time consuming to administeradminister

Performance RequirementsPerformance Requirements

• OptionsOptions– System availabilitySystem availability– Response TimeResponse Time– PenaltiesPenalties

• IssuesIssues– Potential for Potential for

increased bid prices increased bid prices with penaltieswith penalties

– Administration effort Administration effort increases need for increases need for inspection, inspection, monitoringmonitoring

– Partnership between Partnership between MDOT and MDOT and maintenance maintenance providerprovider

Performance RequirementsPerformance Requirements

• Recommendations in MDOT ScopeRecommendations in MDOT Scope– Defined performance requirementsDefined performance requirements– Permit penalties at discretion of engineerPermit penalties at discretion of engineer– Grace period for system availabilityGrace period for system availability– Penalty notification/warning periodPenalty notification/warning period– Reasonable penaltiesReasonable penalties

Equipment PurchaseEquipment Purchase

• Include in contractor pay itemsInclude in contractor pay items– Higher riskHigher risk– How does contractor estimate?How does contractor estimate?

• Estimated quantity by DOT with contractor Estimated quantity by DOT with contractor bidsbids– Complex to defineComplex to define– Non-specified parts?Non-specified parts?– Establishes prices for entire contractEstablishes prices for entire contract– Low incentive for doing cost-effective repairsLow incentive for doing cost-effective repairs

Equipment Purchase (cont.)Equipment Purchase (cont.)

• MDOT owns inventoryMDOT owns inventory– Difficult to administerDifficult to administer– Potential for delay in repairs to unavailable Potential for delay in repairs to unavailable

hardwarehardware

• Lump sum equipment “bank”Lump sum equipment “bank”– Industry standardIndustry standard– Allows for material markup (in Michigan)Allows for material markup (in Michigan)– Takes time to administerTakes time to administer

Third Party DamageThird Party Damage

• Separate category in contract since it is Separate category in contract since it is impossible to plan forimpossible to plan for

• OptionsOptions– Exclude from scope and use other Exclude from scope and use other

purchasing methods to do workpurchasing methods to do work• Delay in repairs (have to issue a new work Delay in repairs (have to issue a new work

order)order)• How do you differentiate claims of damage by How do you differentiate claims of damage by

others from normal damage or contractor others from normal damage or contractor negligence?negligence?

Third Party Damage (cont.)Third Party Damage (cont.)

• Include budget and provision for “as-Include budget and provision for “as-authorized” work with estimateauthorized” work with estimate– Requires an estimate for each third party damageRequires an estimate for each third party damage– What if damage is more extensive than originally What if damage is more extensive than originally

thought?thought?

• If authorized with budgetary estimateIf authorized with budgetary estimate– Quick to authorizeQuick to authorize– Moderately complex to administerModerately complex to administer– Requires trust between DOT and contractorRequires trust between DOT and contractor

ConclusionsConclusions

• Need to answer each question to determine contract Need to answer each question to determine contract typetype

• DOT resources are valuable – need to determine DOT resources are valuable – need to determine where those resources are most appropriately usedwhere those resources are most appropriately used

• Need a method to measure performance of Need a method to measure performance of maintenance activitiesmaintenance activities

• Use shorter term contracts with pre-approved Use shorter term contracts with pre-approved extensions to avoid being locked inextensions to avoid being locked in

• Take the time to develop a contract that you are Take the time to develop a contract that you are comfortable withcomfortable with