With the supply chains untangling, inflation going through a cooling phase, and the possibility of lower borrowing costs in the times ahead, there are indeed a lot of positive signs for US infrastructure in 2024.
The Infrastructure Investment and Jobs Act- IIJA is over two years into its five-year funding cycle, with almost a third of the money disbursed, and analysts say its momentum is progressing. The fruits of that investment happen to be emerging, and a wave of IIJA-funded projects are all set to wrap up in 2024, specifically in the roads and bridges sector.
It is worth noting that the vice chair of the President’s National Infrastructure Advisory Council and also a former president of the American Society of Civil Engineers, Maria Lehman, sees a more absolute, creative, as well as collaborative approach taking place in the industry.
She says that the pandemic has completely altered the propensity to fight change because one has to deal with the deck that is dealt with, and that means doing tasks differently and routinely is not going to do it, as there happens to be a much bigger acceptance of that than there has been in the past.
Let us list out the three infrastructure-related trends builders can anticipate to see more of in 2024:
Restructured federal regulationsÂ
Due to a flood of public money, there are altered regulations for civil builders to navigate.
Government contracts group partner at HKA Global, Jennifer Flickinger, says that there are numerous ways that lead to being up against a wall right now if someone is taking federal funds.
For example, in August last year, the White House clarified and went on to announce rules around which construction materials for federal infrastructure projects must be put forth in the U.S. by way of its Build America, Buy America guidelines. It also updated the Davis-Bacon Act, thereby effectively raising wages on government jobs, and also went on to announce a final rule that will go on to require project labor agreements on federal construction projects worth $35 million or even more.
In between the flood of funding as well as tax credits, builders who have not historically done federal work are taking on publicly funded jobs, and these new entrants happen to be at heightened risk of accidental non-compliance, said Flickinger.
It is well to be noted that builders who are going after clean energy credits may not gauge how they are subject to Davis-Bacon rules. And in order to comply with BABA, builders must go ahead and also investigate where certain sets of materials come from, where vendors get their access, and how best to get them to the jobsite, and that too on time.
In the past, upticks when it comes to federal funding have also meant more audits, said Flickinger.
At the very front, it would behoove contractors so as to really take a step back, really understand that funding source, and also understand those requirements, she said. The fact is that where the funds come from really goes on to drive what rules one has to comply with.
More regulatory changes also happen to be on the horizon. A proposed rule with regards to cybersecurity maturity model certification that goes on to convey the Defense Department’s information security needs for civilian contractors will most likely be finalized in 2024, adds Flickinger.
Notably, that could very well bring new stipulations, which would include email encryption as well as restrictions on making use of equipment from specific countries. It is well to be noted that progress is also anticipated on the Buy Clean requirements, which aim to green the federal government’s procurement practices.
Enhanced digitalization
Although infrastructure projects have gone on to make use of digital platforms for everything from drawings to document management for some time now, the intricacy and capacity of those tools are expanding at a rapid pace, said Caryn Fuller, who happens to be the HKA Global Partner and civil engineer.
Some of the challenges that they have are whether or not they are, in reality, making use of these programs properly, says Fuller. It is indeed important to ensure that all people who are making use of these platforms happen to be properly trained and are aware of the platform they are using.
The fact is that while technology can bolster productivity when it comes to builders, it is not without challenges- latecomers to a job may not as well get proper training on how to make use of a platform, and they may not essentially know the actual protocol and procedures, said Fuller. Improper entry of data could very well result in some members of a project not gaining access to the data and information they require.
It is worth noting that growing connectivity also goes on to open new kinds of risks. A range of cyberattacks targeted critical infrastructure in 2023, thereby hitting hardest the energy landscape, which happens to be subject to 39% of all crucial infrastructure attacks. December ransomware hits on water as well as wastewater infrastructure underscored the risk to those sectors too.
To aid in guarding against cyber threats, civil contractors happen to be subject to Controlled Unclassified Information policies, which are the feds’ consistently shifting requirements around information sharing as well as safeguarding.
They happen to be seeing more bad player stressors than they have witnessed in the past, said Lehman, and that indeed needs hardening infrastructure and being careful when it comes to digital information sharing. Apparently, bad actors happen to be looking for the weak link, and the fact is that they are not looking for Fort Knox.
New procurement and delivery methods
The delivery methods when it comes to massive infrastructure projects are quickly diversifying beyond the classic design-build as well as progressive design-build approaches, said AECOM’s Los Angeles Metro executive, Jill Kurth.
It is worth noting that increasingly, project teams happen to be bringing contractors directly into the dialogue, and that they are talking about not just the delivery strategy but also about how to structure contracts so as to make it more efficient as well as effective for them to procure.
For instance, there are ways so as to bundle RFPs together in order to be able to bid projects at scale or even better share procurement risk with clients. At the same time, builders happen to be getting engaged in the process much earlier, so that there is more partnership, risk-sharing, as well as transparency among the numerous actors that are involved in bringing a project to life.
While all this is generally viewed as a positive development within the sector, it also brings a level of intricacy. For instance, as contractors go on to outsource procurement work, there is a risk of communication breakdowns with subs as well as vendors over material quality or deadlines. At the same time, BABA, along with the Buy Clean requirements, also add another challenge.
Flickinger says that the biggest risk from a supply chain perspective is truly understanding where the products get made. The further one gets away from anything that happens in their own company and own business, the harder it is to ensure that one is absolutely 100% compliant.
Still, while supply chain susceptibility remains a challenge, snarls are easing, and the industry pros happen to be adapting to the new reality, as per Lehman.
Public as well as private clients happen to be more often pre-purchasing the items that go on to have long lead times, like certain valves, traffic signal controllers, as well as transformers, in order to avoid delaying a project, she adds. That advance planning goes on to benefit suppliers as well as builders.
Lehman adds that they have too much to do and there are not enough people or resources to do it, and hence they have to deliver differently, which is kind of exciting.
