Case Study: I-405 Widening Project – Change Order Cascade from Utility Relocation Delays (2015)

Project Overview
• Name: I-405 Widening Project
• Location: Orange County, California
• Year: 2015
• Project Size: $1.9 billion
• Scope: Expansion of I-405 freeway, including HOV and general-purpose lanes
• Lead Agencies/Contractors: Orange County Transportation Authority (OCTA), OC405 Partners

Category of the Issue, Problem, or Challenge
• Contract Change Order
• Utility Coordination

Summary of the Issue, Problem, or Challenge
During construction, delays in utility relocations (by third-party providers) led to a domino effect of change orders related to rescheduling, resequencing of work, and added site safety measures. The contract lacked mechanisms to manage third-party delays effectively.

Root Cause Analysis

• Poor initial coordination with utility owners.
• Change orders required for resequencing work zones.
• Weak contract clauses around third-party impacts.
• Cost escalation due to prolonged standby time and idle equipment.

Impacts Due to the Issue, Problem, or Challenge
• Project delay of 7 months.
• Change order costs exceeding $45 million.
• Strained relationships between agency and contractor.

Corrective Actions Taken

1. Added utility relocation buffers in future schedules.
2. Negotiated stronger utility coordination clauses in future contracts.
3. Required early-stage utility verification and risk planning.
4. Created escalation path for third-party intervention by the agency.

Lessons Learned

• Utility impacts must be clearly addressed contractually.
• Early utility mapping reduces change orders downstream.
• Time buffers and resequencing protocols improve flexibility.
• Clear agency roles in third-party issues can prevent litigation.

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

• Are utility risks and schedules well-defined?
• Do contracts address third-party coordination delays?
• Are schedule buffers in place for utility conflicts?
• Is there a clear escalation and intervention process?