Case Study: Owner Procurement Delays Stall Alaska Highway Project Mobilization (2017)

Project Overview
• Name: Dalton Highway Reconstruction – Milepost 209-235
• Location: North Slope Borough, Alaska
• Year: 2017
• Project Size: $145 million
• Scope: Reconstruction and realignment of 26 miles of Arctic highway, including drainage and embankment work
• Lead Agencies/Contractors: Alaska DOT&PF /

Category of the Issue, Problem, or Challenge
• Contract Owner
• Procurement and Logistics

Summary of the Issue, Problem, or Challenge
The Alaska DOT failed to deliver long-lead culverts and geosynthetics on schedule due to internal procurement delays and vendor certification issues. These owner-furnished materials (OFM) were critical path items.

Root Cause Analysis

• Owner attempted to self-procure to cut project costs but underestimated logistical complexity.
• No performance guarantees were built into OFM delivery timelines.
• Harsh seasonal windows made material delays especially costly.

Impacts Due to the Issue, Problem, or Challenge

• Entire spring-summer construction window was lost.
• Contractor faced remobilization costs and crew unavailability the next season.
• Total delay: 12 months; financial impact exceeded $7.5 million.

Corrective Actions Taken

1. Alaska DOT ceased OFM approach for time-critical materials.
2. Material procurement risk now contractually transferred to contractor.
3. Seasonal logistics plans now embedded in project procurement schedules.

Lessons Learned

• Public owners must be cautious about assuming responsibility for critical material delivery.
• Delays in remote environments can magnify exponentially due to limited access windows.
• Risk transfer via contract must be matched by performance guarantees.

Audit & Prevention: Project Control Questions to Ask on Future Projects to Help Control the Situation

• Are owner-furnished materials truly beneficial from a schedule and risk standpoint?
• Has the owner vetted its internal procurement and logistics capacity?
• Are contingency plans in place for delays in remote or seasonal areas?