Case Study: Cost Overrun from Inaccurate Quantity Estimations on Chicago Deep Tunnel Project (Chicago, IL, 2008)
Project Overview
• Name: Chicago Deep Tunnel System Expansion
• Location: Chicago, Illinois
• Year: 2008
• Project Size: $1.4 billion
• Scope: Construction of underground stormwater tunnels to reduce flooding
• Lead Agencies/Contractors: Metropolitan Water Reclamation District of Greater Chicago /
Category of the Issue, Problem, or Challenge
• Quantity Estimation
• Cost Management
Summary of the Issue, Problem, or Challenge
Underestimation of excavation and concrete quantities led to significant cost overruns as actual volumes exceeded initial projections.
Root Cause Analysis
- Inadequate Survey Data: Initial site surveys lacked detail leading to optimistic quantity assumptions.
- Geological Variability: Unexpected soil and rock conditions increased excavation volumes.
- Estimation Methodology: Use of outdated unit rates and insufficient cross-checks.
- Contractor Input: Limited involvement of contractors during estimation phase reduced accuracy.
Impacts Due to the Issue, Problem, or Challenge
- Cost overruns of about 16%.
- Project schedule extended by five months.
- Increased disputes and claims over quantities and payments.
Corrective Actions Taken
- Implemented detailed geotechnical and topographical surveys pre-bid.
- Adopted collaborative estimating involving contractors and engineers.
- Used updated unit cost databases reflecting current market conditions.
- Instituted periodic quantity re-measurements and adjustments during construction.
Lessons Learned
- Accurate and detailed surveys are essential for reliable quantity estimates.
- Collaboration during estimation improves accuracy and reduces disputes.
- Ongoing measurement and adjustment controls cost impacts.
Audit & Prevention: Project Control Questions to Ask on Future Projects to Help Control the Situation
- Are site surveys detailed and recent?
- Is contractor input integrated into estimation?
- Are quantity measurements updated during construction?