Road Work Dollars Go Further Amid Recession

Economic-stimulus money flowing from Washington to Central Florida may end up building more roads and creating more jobs than expected.

Economic-stimulus money flowing from Washington to Central Florida may end up building more roads and creating more jobs than expected.

Several early bids on work funded with tax dollars approved by the Obama administration and Congress are coming back well under budget -- as much as 63 percent. If the trend holds, the savings could be plowed into extra jobs and work not only in Orlando but across the state, officials say.

So far, 30 projects worth more than $73.5 million have been approved for Orange, Osceola and Seminole counties and area cities. Officials overseeing nine of those have accepted bids -- meaning work could start within weeks. Three came in slightly over budget, but six of them are costing less than anticipated.

In fact, it's a lot less. The predicted bill for those six jobs was $45.2 million, and road builders have promised to do them for $23.7 million, or $21.5 million less. That's a reduction of more than 47 percent.

Conversely, the total of the overruns was not quite $239,000, or 13 percent more than expected.

"It's a direct reflection of how hungry the contractors are," said Bob Burleson, president of the Florida Transportation Builders Association, a trade group based in Tallahassee.

Much of the state's construction industry is tied to the free-falling new-housing market, forcing companies that typically would build roads and sewers for new developments to seek publicly funded jobs. That competition, Burleson said, is driving down prices.

Many contractors, he said, are offering to work at break-even or even lower prices.

"They feel like they can take [the work] at least to not let good people go and to keep the equipment working," he said.

It's fairly common, Burleson said, for jobs to cost 20 percent less than they would have a couple of years ago, before the recession hit.

Steven Olson, a Florida Department of Transportation spokesman, said many bids for stimulus-money work for Central Florida projects have been 50 percent lower than expected.

Statewide, a 20 percent to 30 percent discount is fairly common, said Don Winstead, who follows federal stimulus spending in Florida for Gov. Charlie Crist.

"That's kind of the ballpark," Winstead said. "There are a lot of people bidding out there who are really sharpening their pencils."

Overall, the state has $1.4 billion in federal money for roads and transportation, a pot of money supposed to create almost 40,000 jobs.

Winstead said there is little doubt that the state and local agencies will be able to hire more people and put down more pavement, but it's difficult to determine the numbers right now.

The state has identified 521 transit projects. Of those, 377 have been advertised and 216 awarded to contractors. Work has actually begun on 101 of them.

Winstead expects much of the construction to start early next year, with the stimulus money taking about 18 months to be spent.

Generally, experts say, the larger the project, the greater chance that the bid will come in low. The reason: much of the expense of small jobs, such as resurfacing a street, is tied up in materials, such as asphalt. Bigger jobs involve more equipment and personnel, areas where costs can be reduced.

Larger jobs also take more time. When the economy is strong, bidders figure in delays for bad weather or equipment malfunctions. Those additional expenses invariably are dropped in today's tough, competitive market.

Two FDOT projects, for instance, came in millions of dollars under budget: A widening of State Road 50, from Avalon Road to S.R. 429, was bid at $16.8 million when it was supposed to cost $35.5 million. A widening of S.R. 434, from S.R. 414 to Lotus Landing Boulevard, was bid at $4.6 million when it was supposed to cost $7.3 million.

In Central Florida, the three jobs that came in more expensive than anticipated were smaller undertakings.

In Lake Mary, for example, the resurfacing of Rinehart Road from Lake Mary Boulevard to S.R. 46A -- about 2.1 miles -- came in at $711,849, or $133,000 more than expected.

Lake Mary City Manager John Litton said "we just missed the numbers on the bid."

Savings from other local projects will be used to cover Lake Mary's extra cost, according to MetroPlan Orlando, a regional planning agency serving Orange, Osceola and Seminole counties.

That's good, Litton said, because his town -- which has an annual budget of $20 million -- did not have any extra funds to pay for the additional cost.

"I don't know what I would have done," Litton said.

Savings for state DOT projects will be sent back to agency headquarters in Tallahassee, where officials will redistribute it for projects throughout Florida.

The extra money, Olson said, will go "where you will be able to maximize the dollars."

CONTACT: Dan Tracy can be reached at dtracy@orlandosentinel.com or 407-420-5444.


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