Transportation officials in Austin have run into an issue that could affect some highway and mobility projects. Increasing costs for both labor and materials is driving up the cost of some projects beyond the level normally allowed under the state's procurement rules.
"In May we saw an average of 26 percent cost increase. In June, that was over six percent. And in July the average increase was 15 percent above our estimates," said Jessica Butler, Director of Transportation Planning and Programming. "We are in unprecedented times...with gas prices reaching record highs. The construction industry and TxDOT are also impacted by supply chain disruptions and increasing material and labor costs."
The latest ten-year transportation plan, called the Unified Transportation Program, includes a special provision to account for those rapidly escalating costs. The Texas Transportation Commission will have the ability to approve costs of up to 25 percent over the original estimate on selected projects based on their funding sources.
"We are in extraordinary times," said Texas Transportation Commissioner Alvin New. "I think it's important that in extraordinary times you allow some flexibility and leeway so you can get things done."
However, he noted that the provision would be up for review next year, since "we may or may not be in extraordinary times."
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