Consultant Roundtable: Industry Focusing On Gains

Posted on June 15, 2012 by Alex Roman, Managing Editor

Page 4 of 4

Steven R. Beard, Sr. VP/Transit Market Sector Director

Is there a solution consultants can share with transit agencies to help bridge the funding gap?
There is no magic wand to fix the funding gap for new projects and bring what we have up to an acceptable state of good repair. The consulting/contracting community can provide direct help with “financing” gaps but not with funding gaps. One thing we as consultants can do is work in partnership with our clients to reduce project costs. We can identify innovative ways to do things better and cheaper. We can suggest ways to save money and still satisfy the goals of the project. We can help our clients make do with the funding that they do have. Another thing we can do is to bring our national and international experience to bear by informing our clients what other cities and countries are doing in terms of adding funding sources or increasing the return from the sources they already have.

HDR is currently working with the Counties Transit Improvement Board in the Minneapolis/St. Paul area to define ways to develop and accelerate implementation of a regional program of bus and rail transitway projects. The work draws upon the experience of peer cities around the U.S.

How is the lack of a transportation bill starting to impact your projects?
The primary impact of a lack of a transportation bill is the slowing down of new rail projects in the federal funding pipeline. Agencies are more and more hesitant to invest millions of up-front local dollars with the uncertainty of whether or not the federal funds will be there in the future. Many project sponsors are taking a wait-and-see attitude. Unfortunately, the current proposal for a two-year (or less) bill will not give project sponsors a lot of long term confidence.

Have you seen any growing trends toward design-build? If so, how do you think that will impact your business?
There is definitely an increase in clients using design-build as a project delivery approach. I don’t think we can call design-build an ‘alternative’ delivery method any longer; it is now in the mainstream. Design-build is a quickly growing part of HDR’s transit business. However, we are also very careful not to let the design-build practice have any negative impact on our traditional planning, design and construction services lines of business. Contractors are a relatively new client base for us but we are committed to continuing to provide extraordinary professional services to our traditional clients as well as our new contractor partners. HDR is one of the larger design firms, and we have great relationships with the major contractors. These two factors, combined with our commitment to quality, will serve our design-build clients and our employee-owners well in the years to come.

Legacy Resource Group
Huelon Harrison, Principal

How do you see the upcoming election impacting the industry?
As far as the consultants, the smaller firms, we are pretty much dependent on activity from the transit authorities. Many projects you saw planning for in 2008 that we thought would be in the works beginning in 2010, well here it is 2012 and those projects are still on the table because a lot of agencies don’t want to commit without funding in place to carry it on. For some of those reasons, the elections are very important, because in an election year, everything is on hold. Everybody is anticipating once the elections are over things will stabilize and be on a long-term funding basis versus these 60- or 90-day extensions.

How is the economy impacting smaller firms?
I’ve seen some of the firms have some shrinkage. I’ve seen firms that were preparing for good projects and the projects just don’t happen. So, when you have staff there, versus being a billable person, you are sometimes forced to have to make some tough decisions to streamline, and when things get better, you can ramp back up.

How do you think the industry will be able to maintain growth?
We need to focus on having a safe, reliable service and getting the ridership up. We always see our usual spikes. We see market-driven spikes when gas prices go up, and you think you got somebody who is now going to be converted to a public transit user, but as soon as the prices come down, they get off the train and they get off the bus. We have to help develop a mindset where it’s OK to ride the bus. Also, as you see more of the younger people get into the marketplace that are used to riding the bus or the train, it’s not that much of a paradigm shift to go from college to a new job and still ride the bus. It’s very important to keep people educated to know what’s available and that there are programs to give people an incentive to use public transportation and make it a fun way to get around, versus a last resort.

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