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There is another degree of freedom here: project cost. Why on earth does 0.32 miles of residential road cost $1.5M? Having just managed a construction project

by frisco 6y ago

There is another degree of freedom here: project cost. Why on earth does 0.32 miles of residential road cost $1.5M? Having just managed a construction project much larger than this stretch of road myself, I am certain that a lot of the blame here lies with the contracting process as well as outrageous fees (and just sheer inefficiency) from the engineers and contractors. There is no valid reason this should be so expensive. In the rest of the world, I guarantee you they are not paying over a million dollars for something like this and their standards are just as high if not higher. I’m not sure there is an opportunity to fix this - I’ve spent a lot of time thinking about this now and modeling it out - by building a better construction company: most of the problem is, instead, essentially political.

Elof 6y ago
I have a family member that works for a heavy civil construction company and it sounds like it's a combination of politics and... wait for it, corruption
zachthewf 6y ago
Fascinating. Why don't you think it's possible to build such a construction company? (I have no experience in construction.)
- saghm 6y ago
  I read their comment more as saying that building a better construction company wouldn't fix the issue (e.g. they might not get hired), not that it wasn't possible to build a better company.
  - bvandewalle 6y ago
    I think you hit the nail on the head. Elected officials unfortunately don't have that much incentive to hire the "cheapest" company as the debt will be incurred over the next 100 years while they will be long gone. They probably hire the company that they feel will give them the least amount of trouble, which is the easiest to navigate or that will do something for them in exchange. It's the "not my money" issue at play.
    - selectodude 6y ago
      I think it's quite the opposite. There is heavy incentive to pick the lowest bidder without any consideration paid to how absurd the bid is, which is where you get these crazy cost overruns. The bid was never doable to begin with.
      - imtringued 6y ago
        And once there is a cost overrun it's easy to bloat the budget because the government is stuck with the contractor they hired.
- jldugger 6y ago
  Presumably the problem is that honest construction companies don't win bids.
  - renewiltord 6y ago
    They win when the project is needed. Most of these projects aren't needed. Another HNer pointed out to me that when the East Bay interchange had a collapse due to a tank truck fire, the replacement came in under budget and ahead of time - bidding lower than everyone else and making it back on speed-of-delivery incentives. The reality of most construction projects? You don't need them. You're not going to get better with them and you're not going to get worse without them.
    - jldugger 6y ago
      I don't think you understand how corruption works, so let me share a worked example with you. A stretch of road is past its shelf life and scheduled to be repaved. The city does some analysis, and estimates the cost for that mile of road to be 1M^1. Then they put out a Request for Bids for contractors to do the work, lowest bidder wins. Corrupting the auction is how things fail. The simplest corruption is to leak sealed bids so that you know how much to bid. Remember, this isn't a vickery auction, bidders are paid what they bid and no more. If you want to maximize your profits, all else being equal you want to bid one dollar less than the 2nd best bid. If you were going to bid 800k, someone who informs you the second highest bid is 900k is worth 100k. Sending them a bribe for that tip will still leave you ahead, and the city behind. And if you repeat this, eventually that 2nd bidder is discouraged enough to leave the market, or at least stop participating in Corrupt City IFBs. Which raises the cost per mile even higher. The other method is to disqualify competitors and proposals. Contracts often give a measure of leeway to officials disqualify bids. Or, to advise a bidder to change their proposal before they get disqualified. Or you can just write the work to be done in such a way that only one bidder could feasibly win. ^1 I really don't know the costs here, just examples.
      - renewiltord 6y ago
        For the necessary projects, no one fucks them, because the costs of failure are too high. They are very rare, though, but when comes around it moves like a grass fire on a windy day[0]. That road "past its shelf life"? It's not. Your standards are just too high for your wallet. 0: https://en.wikipedia.org/wiki/MacArthur_Maze#2007_I-580_East_Connector_collapse https://en.wikipedia.org/wiki/MacArthur_Maze#2007_I-580_East...
burlesona 6y ago
It's also a design problem. There are perfectly adequate designs that cost a lot less and function just as well, but if something isn't part of the official standard it generally can't be used. The official standards are set with a lot of industry involvement, and unsurprisingly they're not focused on being cheap.
- ponow 6y ago
  This is partly why the only legally mandated building codes ought to be ones without which people and property outside the private lot in question are put at negligent levels of risk. Any risk inside the lot is yours alone.
  - dpflug 6y ago
    In a society where renting is increasingly common, that seems like a quick way to kill off a bunch of young, poor people.
  - c22 6y ago
    Even if there were no legally mandated building codes banks and insurance companies would probably require most of what we have on the books now in order to get anything done.
pottertheotter 6y ago
I was just thinking about this same thing with my city. We have a fabulous little downtown square and the parks department is proposing to shut down a portion of a street by the square to make it pedestrian only. In doing so, it would be redeveloped into a "promenade". This portion of the street is 60' wide (including sidewalks) and 285' long. That's 17,100 sqft or just shy of 2/5 acre. The cost? $10-13mm! I can't believe that taking out the asphalt, replacing it with concrete, and then adding lighting and plants should cost that much. It's outrageous.
- onlyrealcuzzo 6y ago
  It doesn't cost that much. That's how much they're paying. In my hometown, the city spent $3M to make a single right-turn lane approximately 20-feet longer. This is a city that went from a population of 60k down to 15k. And the population is still contracting rapidly. There is no traffic, and there never will be. And worse, there is no income! And there's zero growth potential. Unsurprisingly, at least last year, it was the city with the highest municipal debt per capita. Combine that with the fact the HH income is very low, and the population is shrinking, and it's a disaster. I find it ironic this is a deeply republican city that constantly talks about the need to cut spending.
  - gonzo41 6y ago
    That just sounds like good old corruption to me.
  - nradov 6y ago
    Expect a wave of municipal bankruptcies over the next several years. We kicked the can down the road during the last financial crisis, but holding interest rates artificially low can only postpone the day of reckoning for so long.
  - codekilla 6y ago
    What city is this?
  - eldavido 6y ago
Reedx 6y ago
How much room for improvement did you net out at? I wonder if there's a point where it'd be significant enough to make inroads... The recent rebuild of a section of the Bay Bridge took 11 years and went 2,500% over budget. Whereas the original entire bridge was built in 5 years, ahead of schedule and under budget. And something I just came across: SF allegedly had 6 Salesforce subscriptions at $1M/YR, and not even using them[1]. Given stuff like that, I worry you're right, it may hardly matter how much better a construction company is. 1. https://twitter.com/michelletandler/status/1273404339566993408 https://twitter.com/michelletandler/status/12734043395669934...
- willcipriano 6y ago
  Offer a 10% tax free finders fee to anyone who finds any wasteful spending like that. $600k once for a $6 million annual savings (and that's before you fire whomever is in charge of auditing the books already) is a steal. Accountants and auditors could work like bug bounty hunters.
  - ryandrake 6y ago
    This is a great idea, but waste is in the eye of the beholder. A $6M environmental impact study might be considered waste by me, considered politically nice by the politician who agreed to it, considered legally necessary by the government's lawyer, and considered vital by the contractor paid to perform the study. Who's right?
    - willcipriano 6y ago
      If similar environmental impact studies cost half as much or if the study was not read by those who ordered it that is a pretty clear case. Some things are ambiguous I admit but I'm willing to bet there is enough low hanging fruit to keep a good number of people employed looking for it. Edit: This is a HN faux pas however, please don't downvote the person above, they added to the discussion. I suspect that may be a common objection and I'm glad to be able to clarify it.
      - 6y ago
chaostheory 6y ago
An obvious and common problem is just corruption. In many instances, the construction company will have personal ties with lawmakers, but let's pretend that corruption is a non-issue. Another large issue is government bureaucracy. The process for proposing projects, winning bids, and being able to start work is a very long process which incurs increased staffing costs due to the time it takes to navigate red tape. This is one reason that government projects cost so much.
zimpenfish 6y ago
> In the rest of the world, I guarantee you they are not paying over a million dollars for something like this Not quite the same construction - this is widening a motorway - but an order of magnitude more expensive - £30M per mile in 2006 money. https://www.theguardian.com/society/2006/dec/13/guardiansocietysupplement3 https://www.theguardian.com/society/2006/dec/13/guardiansoci...
cycomanic 6y ago
> There is another degree of freedom here: project cost. Why on earth does 0.32 miles of residential road cost $1.5M? Having just managed a construction project much larger than this stretch of road myself, I am certain that a lot of the blame here lies with the contracting process as well as outrageous fees (and just sheer inefficiency) from the engineers and contractors. There is no valid reason this should be so expensive. In the rest of the world, I guarantee you they are not paying over a million dollars for something like this and their standards are just as high if not higher. Numbers can vary quite a bit but 1m of road costs about 10000 euro [1] in Germany. So this seems cheap in comparison. Mind you the quality is also quite a bit better. I never understand the complaints about investment in infrastructure and having to pay for it in taxes. I'm generally glad to pay taxes and get a functioning society. But then again the country I live in also does not spend as much on military as the next 6 or 7 next countries combined. Funnily enough the same people who complain about taxes for the road in front of their house hardly ever complain about that. [1] https://www.google.com/url?q=https://rp-online.de/nrw/landespolitik/nrw-was-kostet-eigentlich-ein-meter-strasse_aid-19935783&sa=U&ved=2ahUKEwjOjsDZqozqAhWuxaYKHcm1CcsQFjAAegQIBhAB&usg=AOvVaw1ZXH0W4q74Vc5GuiYSGtNu https://www.google.com/url?q=https://rp-online.de/nrw/landes...
- rbritton 6y ago
  > I never understand the complaints about investment in infrastructure and having to pay for it in taxes. In the US, this is largely due to the perception (right or wrong) of budget bloat and cronyism on taxpayer-funded projects. Those projects have a reputation for cost overruns and generally being more expensive than comparable private projects.
- renewiltord 6y ago
  > I never understand the complaints about investment in infrastructure and having to pay for it in taxes. I'm generally glad to pay taxes and get a functioning society. In the case of the article, the road is not affordable. The writer isn't advocating for not paying taxes. The writer is advocating for not taking on projects you can never net on. That doesn't sound unreasonable.
- fizixer 6y ago
BurningFrog 6y ago
I read somewhere that China builds things at 1000x the efficiency of the US. If that's speed or cost or if it's really only 100x doesn't matter. This is a fundamental superiority Chinese society has, and I don't see the US switching to a pro construction stance anytime soon!
- colinmhayes 6y ago
  China has vertically integrated the entire construction process, making the machines that, extracting the materials, transporting them, and building the infrastructure all using slave wage labor. Americans would never accept that quality of life.
  - mlillie 6y ago
    Is their "slave wage labor" really any worse than being a construction worker in the US, in relative terms?
    - aianus 6y ago
      Yes, significantly so. ~18 workers died and hundreds were injured building the HK bridge to Macau and the Mainland which opened in 2018.
    - velp 6y ago
      Um.. yes? Construction work may be back-breaking and hard but it often pays well, or at least can serve as a path towards a trade or higher earning.
  - BurningFrog 6y ago
    It's not about the wages. It's about a bias towards building things and taking action. Construction in the US bordering on a "Vetocracy". Everyone and their NIMBY uncle can oppose anything being done. So what little gets done happens after many years and at great cost.
- mikestew 6y ago
  I've seen Youtube videos of collapsing buildings in China that were built not terribly long ago (someone on HN posted a link in a related discussion a while ago, but man, I would have to dig). So I would need some additional data to conclude that China is doing it better than anyone else.
austincheney 6y ago
Regulation. Environmental impact surveys, union fees, product compliance, safety regulations and temporary signage all cost money. They increase man hours and require increased materials. You could get rid of all of this but you wouldn’t like the result.
lumost 6y ago
Why don't cities/counties in-source repetitive maintenance and construction tasks? I'd expect that a county has sufficient need to build roads that a small construction crew + equipment could be kept on staff for road work.
- zanny 6y ago
  Because there are now structural incentives put in place by lobbyists to prevent public engineering. Everything has to be contracted and red taped so the bribers of politicians can inject themselves into the taxpayer money pipeline. Its in the same hilarious inefficiency ballpark as medical. Both are built on the foundations of what should be a public service being parasitized from all sides by regulatory capture.
- chance_state 6y ago
  >I'd expect that a county has sufficient need to build roads that a small construction crew + equipment could be kept on staff for road work. Not so sure about that. Filling pot holes? Sure, and they already do that in-house. But building roads must be far less common.
  - jjk166 6y ago
    Let's say a county is a 15 mile by 15 mile square with a square grid of streets spaced on average 1000 feet apart. That would be 2370 miles of road in the county. Assuming a lifetime for that road of 35 years, they need to replace 68 miles of road per year which works out to about 1000 feet per day. At $1.5/.32 miles, they would be spending $881K per day on road replacement. If a county run crew could cut 10% of this cost out, and 50% of that was used for labor, they could employ 198 people at 80k per year on average. A paver capable of paving 1000 feet of 24 foot wide road per day costs approximately 60k. Assuming 10% of cost savings went towards capital equipment, they could purchase 52 such pavers per year. For a more reasonable but still quite liberal budget of $1 million per year of capital equipment financing and maintenance payments and salaries of $200k for 40 employees, that 10% cost savings would allow the county to pocket $22 Million per year. Even if the streets were spaced on average 1 mile apart, that would still be 100 feet per day, and the 10% cost reduction would be $3 million per year. This does not include new construction or regular maintenance of roads, nonetheless other construction projects. Only very small or sparsely populated counties should have any trouble justifying the expense of an in-house construction crew.
grawprog 6y ago
>There is another degree of freedom here: project cost. Why on earth does 0.32 miles of residential road cost $1.5M? Well, the mayor's family member/Buddy who owns the roadworks business who needs their cut, then his family member/Buddy who owns the flagging company needs their cut and Buddy who owns the asphalt production company and so on. Then, work needs to be done as cheaply as possible, with as many corners cut as possible to ensure maximum profit possible for everyone getting their cut. Then the developers will swim around on their mountain of cocaine and money until it runs out and so the cycle goes. This is how every developer i've ever subcontracted for has operated.
- dreamer7 6y ago
  Not sure why this reply is being downvoted. Could have been phrased differently but it seems like street construction projects are low risk opportunities for corruption on a recurrent basis.
taneq 6y ago
> I am certain that a lot of the blame here lies with the contracting process as well as outrageous fees (and just sheer inefficiency) from the engineers and contractors. I think a significant cause of this kind of thing is the use of cost-plus EPCM contractors. Sure it's easy to throw a requirements spec and some money at them and have them take care of everything, but ultimately they earn their crust by spending your money. Suddenly, mysteriously, more meetings are essential, more paperwork is required, and more overhead created in every dimension.
Balgair 6y ago
Brady of Practical Engineering on YT talks about this in one of his videos here: https://www.youtube.com/watch?v=PIK6I6Q58Ec https://www.youtube.com/watch?v=PIK6I6Q58Ec
SllX 6y ago
Union or non-union contractors?
deleted 6y ago
[deleted]
jungletime 6y ago
The best part is when a city tries to renegotiate the cost of a project, and ends up spending 90% for 1/2 of the original design. Then the overruns hit, and somehow they still pay out more. Then it will turn out that there is some sort of critical design flaw, that they need fix, add solar panels to "save money", and so it goes on. The whole thing is a racket in many places.
kungtotte 6y ago
As a frame of reference we were quoted $160,000 USD to resurface two miles worth of residential streets, including ground work like changing drainage pipes and upgrading drains etc. This is in Sweden so YMMV, but we were quoted $80K per mile and these people got told $1.5 million for just over a quarter mile?
cryptica 6y ago
Without a sane monetary system which has a limited supply of money, the ponzi scheme will never pop. It will keep on quietly diluting the wealth of workers to pay for projects which benefit the owners of existing capital. The financial system is founded on financial insanity. The idea that one should keep taking out new credit cards to pay off your the ones - Except that this is happening on a global scale.
BiteCode_dev 6y ago
It's probably a combinations of many factors. Here are some theories, and they could play together: - the population has grown a lot. The demand is way higher, but the offer is propotionally smaller. - competition is disapearing. Big companies are buying or killing the small builders more and more. They set the prices. They have overhead. They can lobby or corrupt. - we have more requirements than before. Safety. Going green. Labor laws. This is not free. We are only paying them now because the infra from decades ago was still holding. - complexity has increased. There are more electricity cables, more water and evacuation pipes, internet cables, gaz pipes, etc. - price of material has increased. The demand is global now. 3 billions of Asians need roads too. - administrative burden is higher. This has unexpected costs. Not to mentions insurances and the risk of being sued. - people are not ready to work as much, and for as little money as before. In my grandma's time, there were plenty of people living very simply, in homes with the bare minimum, working 60 hours a week for a ridiculously small pay. They don't show you that in the movies about "the good old times". - we have less skilled people than before in those industries compared to the technical level it needs now. Because of our failing education system, the disapearence of parallel ways of learning (you could become good at a trade without going to college 80 years ago) and the lack of respect we show to manual workers, the ones remaining to do the job are often not that good. But the requirements are higher than before. - we are used to automation. We have machines doing everything for us. Mechanized processes are expensive if not on a mass scale. There are many things that could be made cheaper, but it would require more skill (and painful work conditions) to do them without those tools. Also, while we are getting better at doing hight tech stuff, we are losing knowledge for the mondain tasks. - it compounds. Industries don't exist in a vaccum. They depend of each other. If machine maintenance, food making and traning people also suffer from the all those same problems, it will affect the building industries situation and hence, prices.

by frisco 6y ago

Elof 6y ago

I have a family member that works for a heavy civil construction company and it sounds like it's a combination of politics and... wait for it, corruption

zachthewf 6y ago

Fascinating. Why don't you think it's possible to build such a construction company? (I have no experience in construction.)

saghm 6y ago
I read their comment more as saying that building a better construction company wouldn't fix the issue (e.g. they might not get hired), not that it wasn't possible to build a better company.
- bvandewalle 6y ago
  I think you hit the nail on the head. Elected officials unfortunately don't have that much incentive to hire the "cheapest" company as the debt will be incurred over the next 100 years while they will be long gone. They probably hire the company that they feel will give them the least amount of trouble, which is the easiest to navigate or that will do something for them in exchange. It's the "not my money" issue at play.
  - selectodude 6y ago
    I think it's quite the opposite. There is heavy incentive to pick the lowest bidder without any consideration paid to how absurd the bid is, which is where you get these crazy cost overruns. The bid was never doable to begin with.
    - imtringued 6y ago
      And once there is a cost overrun it's easy to bloat the budget because the government is stuck with the contractor they hired.
jldugger 6y ago
Presumably the problem is that honest construction companies don't win bids.
- renewiltord 6y ago
  They win when the project is needed. Most of these projects aren't needed. Another HNer pointed out to me that when the East Bay interchange had a collapse due to a tank truck fire, the replacement came in under budget and ahead of time - bidding lower than everyone else and making it back on speed-of-delivery incentives. The reality of most construction projects? You don't need them. You're not going to get better with them and you're not going to get worse without them.
  - jldugger 6y ago
    I don't think you understand how corruption works, so let me share a worked example with you. A stretch of road is past its shelf life and scheduled to be repaved. The city does some analysis, and estimates the cost for that mile of road to be 1M^1. Then they put out a Request for Bids for contractors to do the work, lowest bidder wins. Corrupting the auction is how things fail. The simplest corruption is to leak sealed bids so that you know how much to bid. Remember, this isn't a vickery auction, bidders are paid what they bid and no more. If you want to maximize your profits, all else being equal you want to bid one dollar less than the 2nd best bid. If you were going to bid 800k, someone who informs you the second highest bid is 900k is worth 100k. Sending them a bribe for that tip will still leave you ahead, and the city behind. And if you repeat this, eventually that 2nd bidder is discouraged enough to leave the market, or at least stop participating in Corrupt City IFBs. Which raises the cost per mile even higher. The other method is to disqualify competitors and proposals. Contracts often give a measure of leeway to officials disqualify bids. Or, to advise a bidder to change their proposal before they get disqualified. Or you can just write the work to be done in such a way that only one bidder could feasibly win. ^1 I really don't know the costs here, just examples.
    - renewiltord 6y ago
      For the necessary projects, no one fucks them, because the costs of failure are too high. They are very rare, though, but when comes around it moves like a grass fire on a windy day[0]. That road "past its shelf life"? It's not. Your standards are just too high for your wallet. 0: https://en.wikipedia.org/wiki/MacArthur_Maze#2007_I-580_East_Connector_collapse https://en.wikipedia.org/wiki/MacArthur_Maze#2007_I-580_East...

burlesona 6y ago

It's also a design problem. There are perfectly adequate designs that cost a lot less and function just as well, but if something isn't part of the official standard it generally can't be used. The official standards are set with a lot of industry involvement, and unsurprisingly they're not focused on being cheap.

ponow 6y ago
This is partly why the only legally mandated building codes ought to be ones without which people and property outside the private lot in question are put at negligent levels of risk. Any risk inside the lot is yours alone.
- dpflug 6y ago
  In a society where renting is increasingly common, that seems like a quick way to kill off a bunch of young, poor people.
- c22 6y ago
  Even if there were no legally mandated building codes banks and insurance companies would probably require most of what we have on the books now in order to get anything done.

pottertheotter 6y ago

I was just thinking about this same thing with my city. We have a fabulous little downtown square and the parks department is proposing to shut down a portion of a street by the square to make it pedestrian only. In doing so, it would be redeveloped into a "promenade". This portion of the street is 60' wide (including sidewalks) and 285' long. That's 17,100 sqft or just shy of 2/5 acre. The cost? $10-13mm! I can't believe that taking out the asphalt, replacing it with concrete, and then adding lighting and plants should cost that much. It's outrageous.

onlyrealcuzzo 6y ago
It doesn't cost that much. That's how much they're paying. In my hometown, the city spent $3M to make a single right-turn lane approximately 20-feet longer. This is a city that went from a population of 60k down to 15k. And the population is still contracting rapidly. There is no traffic, and there never will be. And worse, there is no income! And there's zero growth potential. Unsurprisingly, at least last year, it was the city with the highest municipal debt per capita. Combine that with the fact the HH income is very low, and the population is shrinking, and it's a disaster. I find it ironic this is a deeply republican city that constantly talks about the need to cut spending.
- gonzo41 6y ago
  That just sounds like good old corruption to me.
- nradov 6y ago
  Expect a wave of municipal bankruptcies over the next several years. We kicked the can down the road during the last financial crisis, but holding interest rates artificially low can only postpone the day of reckoning for so long.
- codekilla 6y ago
  What city is this?
- eldavido 6y ago

Reedx 6y ago

How much room for improvement did you net out at? I wonder if there's a point where it'd be significant enough to make inroads... The recent rebuild of a section of the Bay Bridge took 11 years and went 2,500% over budget. Whereas the original entire bridge was built in 5 years, ahead of schedule and under budget. And something I just came across: SF allegedly had 6 Salesforce subscriptions at $1M/YR, and not even using them[1]. Given stuff like that, I worry you're right, it may hardly matter how much better a construction company is. 1. https://twitter.com/michelletandler/status/1273404339566993408 https://twitter.com/michelletandler/status/12734043395669934...

willcipriano 6y ago
Offer a 10% tax free finders fee to anyone who finds any wasteful spending like that. $600k once for a $6 million annual savings (and that's before you fire whomever is in charge of auditing the books already) is a steal. Accountants and auditors could work like bug bounty hunters.
- ryandrake 6y ago
  This is a great idea, but waste is in the eye of the beholder. A $6M environmental impact study might be considered waste by me, considered politically nice by the politician who agreed to it, considered legally necessary by the government's lawyer, and considered vital by the contractor paid to perform the study. Who's right?
  - willcipriano 6y ago
    If similar environmental impact studies cost half as much or if the study was not read by those who ordered it that is a pretty clear case. Some things are ambiguous I admit but I'm willing to bet there is enough low hanging fruit to keep a good number of people employed looking for it. Edit: This is a HN faux pas however, please don't downvote the person above, they added to the discussion. I suspect that may be a common objection and I'm glad to be able to clarify it.
    - 6y ago

chaostheory 6y ago

An obvious and common problem is just corruption. In many instances, the construction company will have personal ties with lawmakers, but let's pretend that corruption is a non-issue. Another large issue is government bureaucracy. The process for proposing projects, winning bids, and being able to start work is a very long process which incurs increased staffing costs due to the time it takes to navigate red tape. This is one reason that government projects cost so much.

zimpenfish 6y ago

> In the rest of the world, I guarantee you they are not paying over a million dollars for something like this Not quite the same construction - this is widening a motorway - but an order of magnitude more expensive - £30M per mile in 2006 money. https://www.theguardian.com/society/2006/dec/13/guardiansocietysupplement3 https://www.theguardian.com/society/2006/dec/13/guardiansoci...

cycomanic 6y ago

> There is another degree of freedom here: project cost. Why on earth does 0.32 miles of residential road cost $1.5M? Having just managed a construction project much larger than this stretch of road myself, I am certain that a lot of the blame here lies with the contracting process as well as outrageous fees (and just sheer inefficiency) from the engineers and contractors. There is no valid reason this should be so expensive. In the rest of the world, I guarantee you they are not paying over a million dollars for something like this and their standards are just as high if not higher. Numbers can vary quite a bit but 1m of road costs about 10000 euro [1] in Germany. So this seems cheap in comparison. Mind you the quality is also quite a bit better. I never understand the complaints about investment in infrastructure and having to pay for it in taxes. I'm generally glad to pay taxes and get a functioning society. But then again the country I live in also does not spend as much on military as the next 6 or 7 next countries combined. Funnily enough the same people who complain about taxes for the road in front of their house hardly ever complain about that. [1] https://www.google.com/url?q=https://rp-online.de/nrw/landespolitik/nrw-was-kostet-eigentlich-ein-meter-strasse_aid-19935783&sa=U&ved=2ahUKEwjOjsDZqozqAhWuxaYKHcm1CcsQFjAAegQIBhAB&usg=AOvVaw1ZXH0W4q74Vc5GuiYSGtNu https://www.google.com/url?q=https://rp-online.de/nrw/landes...

rbritton 6y ago
> I never understand the complaints about investment in infrastructure and having to pay for it in taxes. In the US, this is largely due to the perception (right or wrong) of budget bloat and cronyism on taxpayer-funded projects. Those projects have a reputation for cost overruns and generally being more expensive than comparable private projects.
renewiltord 6y ago
> I never understand the complaints about investment in infrastructure and having to pay for it in taxes. I'm generally glad to pay taxes and get a functioning society. In the case of the article, the road is not affordable. The writer isn't advocating for not paying taxes. The writer is advocating for not taking on projects you can never net on. That doesn't sound unreasonable.
fizixer 6y ago

BurningFrog 6y ago

I read somewhere that China builds things at 1000x the efficiency of the US. If that's speed or cost or if it's really only 100x doesn't matter. This is a fundamental superiority Chinese society has, and I don't see the US switching to a pro construction stance anytime soon!

colinmhayes 6y ago
China has vertically integrated the entire construction process, making the machines that, extracting the materials, transporting them, and building the infrastructure all using slave wage labor. Americans would never accept that quality of life.
- mlillie 6y ago
  Is their "slave wage labor" really any worse than being a construction worker in the US, in relative terms?
  - aianus 6y ago
    Yes, significantly so. ~18 workers died and hundreds were injured building the HK bridge to Macau and the Mainland which opened in 2018.
  - velp 6y ago
    Um.. yes? Construction work may be back-breaking and hard but it often pays well, or at least can serve as a path towards a trade or higher earning.
- BurningFrog 6y ago
  It's not about the wages. It's about a bias towards building things and taking action. Construction in the US bordering on a "Vetocracy". Everyone and their NIMBY uncle can oppose anything being done. So what little gets done happens after many years and at great cost.
mikestew 6y ago
I've seen Youtube videos of collapsing buildings in China that were built not terribly long ago (someone on HN posted a link in a related discussion a while ago, but man, I would have to dig). So I would need some additional data to conclude that China is doing it better than anyone else.

austincheney 6y ago

Regulation. Environmental impact surveys, union fees, product compliance, safety regulations and temporary signage all cost money. They increase man hours and require increased materials. You could get rid of all of this but you wouldn’t like the result.

lumost 6y ago

Why don't cities/counties in-source repetitive maintenance and construction tasks? I'd expect that a county has sufficient need to build roads that a small construction crew + equipment could be kept on staff for road work.

zanny 6y ago
Because there are now structural incentives put in place by lobbyists to prevent public engineering. Everything has to be contracted and red taped so the bribers of politicians can inject themselves into the taxpayer money pipeline. Its in the same hilarious inefficiency ballpark as medical. Both are built on the foundations of what should be a public service being parasitized from all sides by regulatory capture.
chance_state 6y ago
>I'd expect that a county has sufficient need to build roads that a small construction crew + equipment could be kept on staff for road work. Not so sure about that. Filling pot holes? Sure, and they already do that in-house. But building roads must be far less common.
- jjk166 6y ago
  Let's say a county is a 15 mile by 15 mile square with a square grid of streets spaced on average 1000 feet apart. That would be 2370 miles of road in the county. Assuming a lifetime for that road of 35 years, they need to replace 68 miles of road per year which works out to about 1000 feet per day. At $1.5/.32 miles, they would be spending $881K per day on road replacement. If a county run crew could cut 10% of this cost out, and 50% of that was used for labor, they could employ 198 people at 80k per year on average. A paver capable of paving 1000 feet of 24 foot wide road per day costs approximately 60k. Assuming 10% of cost savings went towards capital equipment, they could purchase 52 such pavers per year. For a more reasonable but still quite liberal budget of $1 million per year of capital equipment financing and maintenance payments and salaries of $200k for 40 employees, that 10% cost savings would allow the county to pocket $22 Million per year. Even if the streets were spaced on average 1 mile apart, that would still be 100 feet per day, and the 10% cost reduction would be $3 million per year. This does not include new construction or regular maintenance of roads, nonetheless other construction projects. Only very small or sparsely populated counties should have any trouble justifying the expense of an in-house construction crew.

grawprog 6y ago

>There is another degree of freedom here: project cost. Why on earth does 0.32 miles of residential road cost $1.5M? Well, the mayor's family member/Buddy who owns the roadworks business who needs their cut, then his family member/Buddy who owns the flagging company needs their cut and Buddy who owns the asphalt production company and so on. Then, work needs to be done as cheaply as possible, with as many corners cut as possible to ensure maximum profit possible for everyone getting their cut. Then the developers will swim around on their mountain of cocaine and money until it runs out and so the cycle goes. This is how every developer i've ever subcontracted for has operated.

dreamer7 6y ago
Not sure why this reply is being downvoted. Could have been phrased differently but it seems like street construction projects are low risk opportunities for corruption on a recurrent basis.

taneq 6y ago

> I am certain that a lot of the blame here lies with the contracting process as well as outrageous fees (and just sheer inefficiency) from the engineers and contractors. I think a significant cause of this kind of thing is the use of cost-plus EPCM contractors. Sure it's easy to throw a requirements spec and some money at them and have them take care of everything, but ultimately they earn their crust by spending your money. Suddenly, mysteriously, more meetings are essential, more paperwork is required, and more overhead created in every dimension.

Balgair 6y ago

Brady of Practical Engineering on YT talks about this in one of his videos here: https://www.youtube.com/watch?v=PIK6I6Q58Ec https://www.youtube.com/watch?v=PIK6I6Q58Ec

SllX 6y ago

Union or non-union contractors?

deleted 6y ago

[deleted]

jungletime 6y ago

The best part is when a city tries to renegotiate the cost of a project, and ends up spending 90% for 1/2 of the original design. Then the overruns hit, and somehow they still pay out more. Then it will turn out that there is some sort of critical design flaw, that they need fix, add solar panels to "save money", and so it goes on. The whole thing is a racket in many places.

kungtotte 6y ago

As a frame of reference we were quoted $160,000 USD to resurface two miles worth of residential streets, including ground work like changing drainage pipes and upgrading drains etc. This is in Sweden so YMMV, but we were quoted $80K per mile and these people got told $1.5 million for just over a quarter mile?

cryptica 6y ago

Without a sane monetary system which has a limited supply of money, the ponzi scheme will never pop. It will keep on quietly diluting the wealth of workers to pay for projects which benefit the owners of existing capital. The financial system is founded on financial insanity. The idea that one should keep taking out new credit cards to pay off your the ones - Except that this is happening on a global scale.

BiteCode_dev 6y ago

It's probably a combinations of many factors. Here are some theories, and they could play together: - the population has grown a lot. The demand is way higher, but the offer is propotionally smaller. - competition is disapearing. Big companies are buying or killing the small builders more and more. They set the prices. They have overhead. They can lobby or corrupt. - we have more requirements than before. Safety. Going green. Labor laws. This is not free. We are only paying them now because the infra from decades ago was still holding. - complexity has increased. There are more electricity cables, more water and evacuation pipes, internet cables, gaz pipes, etc. - price of material has increased. The demand is global now. 3 billions of Asians need roads too. - administrative burden is higher. This has unexpected costs. Not to mentions insurances and the risk of being sued. - people are not ready to work as much, and for as little money as before. In my grandma's time, there were plenty of people living very simply, in homes with the bare minimum, working 60 hours a week for a ridiculously small pay. They don't show you that in the movies about "the good old times". - we have less skilled people than before in those industries compared to the technical level it needs now. Because of our failing education system, the disapearence of parallel ways of learning (you could become good at a trade without going to college 80 years ago) and the lack of respect we show to manual workers, the ones remaining to do the job are often not that good. But the requirements are higher than before. - we are used to automation. We have machines doing everything for us. Mechanized processes are expensive if not on a mass scale. There are many things that could be made cheaper, but it would require more skill (and painful work conditions) to do them without those tools. Also, while we are getting better at doing hight tech stuff, we are losing knowledge for the mondain tasks. - it compounds. Industries don't exist in a vaccum. They depend of each other. If machine maintenance, food making and traning people also suffer from the all those same problems, it will affect the building industries situation and hence, prices.