The Shucet Solution: Outsource Maintenance

The first of Philip Shucet's proposed transportation reforms is to outsource road and highway maintenance more aggressively. By way of background, it is critical to understand that VDOT had been moving in the direction of developing an advanced asset-management system around the time that Shucet left the department in the summer. I don't know what the status of that program is currently, but Shucet regarded it as the next major phase of VDOT reform. If Phase 1 was doing a better job with project management -- bringing in new construction projects on time and on budget -- Phase 2 is to do a better job of managing the tens of billions of dollars worth of transportation assets under VDOT's care.

An asset management program is a necessary precursor to effective outsourcing. VDOT must maintain a full inventory of its assets -- roads, highways, bridges, etc. -- the standards it wants to maintain them to, and the capability to measure assets against those standards.

Once VDOT has that system in place, it can then intelligently outsource different pieces -- or all -- of the state highway system. In his letter to the START commission, Shucet argued that outsourcing would shift the capital cost of new equipment to the private sector, divest state property no longer needed, spur competition, resulting in lower costs and improved performance, reduce the size of VDOT, and -- don't underestimate the significance of this -- "shift the front-line accountabilty for outcome-based maintenance standards to the private sector."

Further: "Shifting the delivery of maintenance services to the private sector offers an opportunity over time to develop a substantially smaller, yet more productive, program-focused state transportation agency" (my emphasis). In other words, outsourcing would allow VDOT to evolve into a department whose primary maintenance focus is setting standards, tracking metrics and enforcing accountability of the private-sector contractors to whom it outsources the maintenance work.

Concluded Shucet: "A carefully executed implementation strategy could be developed and implemented over 36 to 60 months. And, I believe the overall result will be lower costs and improved productivity."