Mitigating Claims and Disputes for Public–Private–Partnership Transportation Projects in the United States

Abstract

As the construction industry continues to lead the economic growth of many countries, alternative contracting methods have been increasing as a valuable tool to implement on projects. The public–private–partnership (P3) delivery method is becoming an increasingly popular delivery method for megaprojects due to its many advantages, such as private entity financing and the transfer of design, construction operations, and maintenance risks to a concessionaire. As more P3 transportation projects are being executed in the United States, researchers are considering how effectively contracts have been negotiated and drafted between owners and contractors to account for project risks and, consequently, reduce claims and disputes. The objective of this study was to (1) investigate how P3 transportation projects’ contracts are drafted to allocate risks, (2) identify the leading causes of claims and disputes on such projects, and (3) provide recommendations on how risks can be managed and allocated during the contract negotiation phase to reduce claims and disputes. To achieve these objectives, 10 case studies were conducted on 10 P3 transportation projects nationwide with a total cost of $11 billion. The case studies included both content analysis of bid and contract documents and follow-up interviews with project team members to identify risks that caused claims on the projects. The results showed that right of way (ROW) availability, utility relocations, staffing, governmental approvals, and differing site conditions were the leading causes of claims and disputes on the P3 transportation projects included in this case analysis. The results and recommendations can be used to mitigate the negative impact of such risks on future P3 transportation projects.