Rising prices have led Georgia to reject bids for some highway construction projects in metro Atlanta and elsewhere, state officials say.
The Georgia Department of Transportation rejected 12 bids for various projects in June and withdrew an additional six contracts from the procurement process.
Chief Engineer Meg Pirkle told the State Transportation Board on Thursday that rising costs in the construction industry led to the unusually high number of rejected bids. On average, recent bids are 33% above what GDOT expected to pay, though some are 80% to 90% higher.
Among the rejected or withdrawn bids were projects to resurface nearly 11 miles of I-85 in Gwinnett County, nearly 6 miles of I-285 in DeKalb County and nearly 9 miles of U.S. 19 in Fulton County.
GDOT awarded 35 contracts in June, so many road projects will continue. And work on the rejected or withdrawn projects may eventually be done.
But Pirkle said inflation likely will mean less work will get done than originally planned. She said the agency must prioritize which projects it wants to complete.
“We know with prices going up that much, we’re not going to be able to deliver everything in the (construction) program,” Pirkle said.
The agency has said for months that inflation, labor shortages and supply-chain backups could affect construction projects. The cost of diesel fuel, steel mill products and other construction materials has skyrocketed. Thursday’s meeting confirmed those pressures continue.
Much of the blow may be cushioned by the bipartisan infrastructure law that Congress approved last year. The law increased federal highway funding for Georgia by 22% this year, with funding increasing to 30% over previous levels by the fifth year of the program.
But with bid prices coming in 33% higher than expected, GDOT Commissioner Russell McMurry said the federal funding won’t cover all of the funding gap. And the big increase in construction that the new funding was expected to pay for likely won’t materialize.
“We’re not going to see some of the big gains we thought we were going to get out of the bipartisan infrastructure law,” McMurry told the board. “But thank goodness it’s there.”
Inflation hurts Georgia road work
The Georgia Department of Transportation rejected 12 bids for road construction projects in June and withdrew an additional six projects from the procurement process, citing higher-than-expected costs. Here’s a look at three affected projects:
- Resurfacing 5.9 miles of I-285 near Ashford Dunwoody Road in DeKalb County.
- Resurfacing 8.8 miles of U.S. 19 from the Clayton County line to north of U.S. 78 in Fulton County.
- Resurfacing 10.7 miles of I-85 from Jimmy Carter Boulevard to north of Old Peachtree Road in Gwinnett County.
SOURCE: GDOT
