Top 5 Risks & Mitigation Strategies: Public Infrastructure Owners

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e-Builder.net 800.580.9322 info@e-builder.net 03/16/18 2 GOVERNMENT WHITE PAPER Public infrastructure owners managing capital improvement bond programs face a diverse range of risks that can negatively impact schedule and cost-effective project delivery. Typically, these programs involve large expenditures, bring together parties with competing interests, and must address complex conditions and potential public scrutiny—all of which adds risk to already difficult undertakings. In a time where capital is tight, proactive owners have taken steps to minimize the chance for delays or overruns by enabling better project controls that provide measurable cost reductions. This whitepaper identifies the top 5 risks facing owners managing ongoing capital construction projects and provide a summary of the strategies that owners have undertaken to mitigate risk using actual stories. For the purposes of this white paper, RISK is defined as an event, variable, process or activity that can create liabilities for an owner leading to: 1. Cost and schedule delays 2. Claims and disputes 3. Regulatory noncompliance Infrastructure Project Management—It's a Risky Business Defining Risk as It Relates to the Construction Industry Projects that Exceeded Budget Percentage of education owners in each of the five performance brackets for how often the final construction costs exceeded the budget anticipated at the time of captial allocation. How Much Over Budget? According to a recent Dodge Data & Analytics SmartMarket Brief, 93% of public infrastructure owners report exceeding budget. While about half (48%) of them report infrequent cost overruns (on less than 25% of their projects), a relatively large proportion (26%) say that the majority of their projects exceed budget - clearly establishing this as a major owner challenge. 5%-10% over budget 44% Less than 5% over budget 35% More than 10% over budget 21% Know the Numbers! Owners Exceeding Budget Amount that Projects Exceed Original Capital Allocation

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