Variance Analysis of TDOT Highway Construction Prices for Modeling Estimates

This study investigates variance of TDOT (Year 2003) bid price data for the purpose of modeling unit price estimates. Transportation departments normally use the weighted average unit price estimates for planning, budgeting, financing, and pre-construction. Data presented in this dissertation describe the variation of bid price compared (1) to weighted average price, (2) to predicted price by linear regression, and (3) to partition price by quantity.

The major focus of this dissertation was to develop reasonable unit price estimates and establish the price by quantity relationship for seven line items of highway construction work. The basic focus in this case was to develop a shortcut to reach the decision as to whether a bid price is reasonable.

The results can be implemented to provide uniformity of unit price estimates throughout the state and used to reject or award contracts with a minimum expenditure of time and effort.

Based on the results in this research, a suggested unit price estimate approach for determining reasonable price estimates is presented.