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Causes, Implications, and Strategies for Project Closeout Delays in Highway

Construction

Article in Transportation Research Record Journal of the Transportation Research Board · April 2022
DOI: 10.1177/03611981221087229

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Research Article

Transportation Research Record

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Causes, Implications, and Strategies Transportation Research Board 2022
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DOI: 10.1177/03611981221087229

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Manideep Tummalapudi1 , Christofer M. Harper1 ,

Timothy R.B. Taylor2, Steve Waddle3, and Rachel Catchings3

Abstract
In highway construction, completing projects on time is critical. However, when projects are not completed on time, one of
the aspects that is often neglected by the state departments of transportation (DOTs), which causes delays in highway con-
struction, is project closeout. The project closeout phase, if delayed, not only has consequences for transportation agencies
and contractors, but also leads to substantial social costs to the public. Despite the potential magnitude of the impact, there
is limited knowledge about the factors that cause project closeout delays or about strategies for timely highway construction
project closeouts. This study identified the causes that delay highway project closeouts, raises awareness of the implications
of delays, and provides recommendations for efficient highway project closeout practices. The research methodology
included an extensive literature review, a survey questionnaire (40 state DOTs participating), and case studies of eight state
DOTs. The results showed that difficulties in attaining the required documentation, claims and litigations, managing multiple
funding sources, a lack of urgency from local utilities/entities, and the lack of sufficient DOT project staff are major factors
that delay project closeout. When a highway construction project is not closed out in a timely manner, the DOT can be sub-
ject to additional costs, obsolete funding sources, loss of project documentation, loss of staff with project knowledge
(through retirement/attrition), and potential adverse impacts on internal and external relationships. The authors provide rec-
ommendations for state DOTs to mitigate closeout delays and help ensure timely finalization of highway construction
projects.

Keywords
infrastructure, construction, construction management, project close-out

Closing out highway construction projects at depart-
ments of transportation (DOTs) is a complex process. It
requires finishing the construction work, gaining accep-
tance of such work, and finalizing the financial obliga-
tions and accounts of the project. In highway
construction projects, closeout encompasses the time and
activities that fall between substantial completion of the
construction and finalization of the contract, including
finishing any remaining work and rectifying and closing
the financial accounts (1). The closeout process com-
prises several steps and checklists, as well as distinct doc-
uments, reports, and certifications that are required
before the project is truly closed. With all the steps and
documentation needed, the closeout process takes time.
In recent years, the number of public transportation
highway projects in the United States has steadily
increased; any delays in project closeout can further
delay downstream projects (2).
When the closeout process is extended because of
delays, there are consequences for the stakeholders
involved. Delays in the construction closeout process can
have financial impacts for both the contractors and
1
Department of Construction Management, Colorado State University,
Fort Collins, CO
2
Department of Civil Engineering, University of Kentucky, Lexington, KY
3
Kentucky Transportation Center, Lexington, KY
Corresponding Author:
Christofer Michael Harper, chris.harper@colostate.edu
2 Transportation Research Record 00(0)
transportation agencies. For example, final payment to
contractors may be delayed, which will affect profitabil-
ity. Projects that are not closed out encumber funds
within the state transportation agencies, which could
affect funding allocations for new projects. Construction-
, administrative-, and financial personnel might struggle
to effectively close out a project because of factors such
as lack of or inaccurate documentation or an inability to
rectify financial accounts (3). Such challenges warrant
specific attention from the project management team
during the construction project closeout phase to ensure
timely completion and proper closure of projects. It is in
the best interests of all stakeholders that highway con-
struction projects are completed at the earliest possible
date and without delays in closeout (4). Therefore, this
study focused on the causes and impacts associated with
delays in closing out highway construction projects,
along with identifying potential strategies to reduce proj-
ect closeout delays.
Background and Literature Review
Project closeout consists of the completion of construc-
tion, administrative, and financial activities and takes
place after all obligations have been fulfilled and the
required documents have been collected and compiled.
According to Federal Highway Administration, project
closeout is, ‘‘the process that closes out the financial
award for a public transportation agency when all appli-
cable administrative actions and required project work
have been completed for a highway project. Project clo-
seout involves construction closeout and financial close-
out’’ (5). The project management team therefore faces a
completely new set of challenges in the closeout phase to
bring the project to a successful conclusion (3).
The closeout process commonly consists of four steps:
(a) monitoring and documenting the construction process
by inspecting the highway construction operations, (b)
accepting the construction contract implicating that the
project has reached final acceptance as the contractor has
fulfilled their obligations to the contract, (c) making final
payments to contractors for project expenses, and (d)
retention of project records that are collected and devel-
oped during construction and contract administration
(6). Closeout in transportation projects is crucial because
the process involves
 Redistributing resources, including staff and facili-
ties, both on the transportation agency and con-
tractor sides;
 Rectifying and closing all financial issues, such
as change orders, retainage, and subcontractor
payments;
 Transferring costs to proper accounts and repro-
gramming excess funds;
 Collecting all completed documents including as-
built drawings, warranties, guarantees, and opera-
tion manuals and archiving them for project
records; and
 Providing an administrative record to serve as a
basis for judicial review, and community relations
with the traveling public (7–9).
Problems encountered during these activities not only
result in project closeout delays but may also result in
additional project costs and negatively affect transporta-
tion agencies’ project portfolios.
When a highway project experiences delays in the clo-
seout process, the delays hamper completion of the con-
struction work, contract administration tasks, closing
financial accounts, and making and receiving final pay-
ments. Previous research into transportation project clo-
seout has revealed that delays are typically attributed to
claims, dispute resolution, and cost overruns (8).
Furthermore, challenges associated with project closeout
include interacting with multiple internal transportation
agency divisions, working with external stakeholders,
reconciling multiple funding sources, changing project
personnel, migrating paper-based documents to elec-
tronic files, competing staff responsibilities, and a
plethora of other influences attributed to the specifics of
a project (10, 11). Documentation plays a critical role in
the timely closeout of transportation projects (12). To
close a project, transportation agencies require a compre-
hensive set of documentation that includes as-built draw-
ings, disadvantaged business enterprise (DBE) reports,
final acceptance documents, final cost estimates, material
certifications, and warranties (13). Most transportation
agencies require submission and approval of as-built
drawings before delivering the final payment, and trans-
portation agencies then retain an up to date set of as-
built plans for future purposes (10, 14). The following is
a list of common reasons that result in project closeout
delays (8, 10):
 Absence of responsiveness and responsibility from
the contractor,
 Adversarial relationships between the owner and
contractor,
 Completing punch lists (e.g., minor repairs required
before substantial completion can be acheived) in
occupied spaces,
 Contractor goes out of business/defaults,
 Contractor is slow in submitting required closeout
documentation,
 Contractor or state DOT staff transferring to
another project or leaving the company,
Tummalapudi et al 3

 Delayed payment by the owner,
 Excessive or multiple punch lists,
 Issuing a substantial completion or acceptance cer-
tificate for partially completed projects,
 Lack of a contractually agreed dispute resolution
method,
 Lack of preparedness and planning by the con-
tractor for project closeout,
 Lack of proper closeout processes,
 Lack of surety consent,
 Liens and stop work orders,
 No incentive for timely closeout,
 Unachievable project closeout period,
 Unclear contractual project closeout requirements,
 Unresolved claims and disputes, and
 Using part of a project before total completion of
the project occurs.
Additionally, Kaul, identified four major factors that
can affect the closeout process: psychological, financial,
technical, and administrative (15). Table 1 outlines the
types of delays that are associated with these four factors.
Of the reasons and factors listed, transportation agencies
might consider these closeout delay factors before the
development of a project so that the delays are reduced
or alleviated long before the project gets to the closeout
phase.
When the project closeout process experiences delays,
the delays have lasting implications such as the inability
to close the financial accounts and reconcile project
funds, regardless of whether there is an excess or short-
age, which creates a burden on transportation agencies in
their efforts to efficiently use available resources and staff
(8). Delays also affect the contractor, as final payments
take longer than expected, which has an impact on the
contractor’s bonding capacity and sometimes leads to
claims and litigation, further delaying the closeout as
projects typically cannot be closed with unresolved claims
(9). In addition to exploring the implications of project
closeout delays, a study by Johnson et al. quantified the
delays (10). The research team analyzed closeout data
from the Kentucky Transportation Cabinet (KYTC) for
the years 2016 to 2017. Based on the analysis, the authors
estimated that reducing closeout delays to zero across
KYTC could result in a reduction of enough encumbered
funds (i.e., funds held as a result of delayed closeout) to
pave an additional 2,000 to 7,000 mi of lanes.
To alleviate project closeout delays and gain the
potential quantitative value of reducing such delays, pre-
vious research has identified techniques that can help
transportation agencies in this regard. Figure 1 sum-
marizes a range of techniques for transportation agencies
to consider to reduce or eliminate project closeout delay
factors.
The phrase ‘‘last but not least’’ describes the impor-
tance of the project closeout phase (15). It is extremely
important that the final phase be given due attention and
that adequate planning is undertaken to successfully
complete all activities. To improve the project closeout
process, it is important for all stakeholders to have

Table 1. Factors Affecting Closeout and Types of Impacts (15)

Factor Type

Psychological Project manager or superintendent demobilized before final completion

Stress of learning new technology/processes owing to labor shortages
Lack of urgency in the approach, enthusiasm, and motivation of parties involved resulting
from having achieved substantial completion
Demotivation of team members losing coworkers because of downsizing or the moving of labor
Limited leadership of the project team
Barriers in the flow of communication
Financial Owner-directed change order
Delay by owner for payment of work before substantial completion
Contractor penalties for delayed project completion
Technical Technical expertise
Sustainable construction certification
Commissioning requirements
Lack in planning and resource allocation
Unclear directives for closeout in specifications and contract
Accidents to people/equipment after substantial completion or acceptance
Procedural inexperience of owner representative or design team
Administrative Improper/untimely contractual closeout documentation
Subcontract closeout requirements
Multiple punch lists
Shortage/late arrival of resources
State and municipal regulatory requirements
Federal regulatory requirements
4 Transportation Research Record 00(0)
Figure 1. Techniques for reducing or eliminating project closeout delays (7, 8, 10, 15).
knowledge of the project closeout challenges, including
understanding the causes and implications of these
delays on the overall project performance. This under-
standing and implementation of techniques to avoid such
delays could improve the efficiency of transportation
agencies by providing additional funds and resources to
build more lane miles. However, research efforts in rela-
tion to highway project closeout and associated delays
have been minimal; this is what warrants this study. Its
contribution to the body of knowledge lies in identifying
the causes of delays in highway construction project clo-
seouts, in raising awareness of the implications of such
delays, and in investigating effective project closeout
practices and strategies to help state DOTs streamline
their closeout procedures.
Methodology
The objectives of this study were to examine the highway
construction project closeout practices of state DOTs
and disseminate findings on the factors that delay close-
out, the implications of such delays, and raise awareness
of potential strategies to avoid or mitigate delays in high-
way project closeout. To achieve these objectives, a mul-
tiphase research methodology using three core research
tasks was adopted. The first task included an extensive
literature review to collate information on project
closeout and associated processes and procedures per-
taining to highway construction projects. Building on
this information, the second task involved developing
and distributing a survey questionnaire to state DOTs to
identify current closeout practices of highway construc-
tion projects across the United States. For the final task,
the authors selected eight DOTs in which to conduct case
studies on project closeout duration, the delay factors,
the implications of delays, and the lessons learned from
closing out highway projects in a timely manner.
Survey of State DOTs
From the data collected in the literature review, the
authors developed a questionnaire to survey state DOTs.
The purpose of the survey was to gather information on
current practices of closing out highway construction
projects, and to identify state DOTs with the knowledge
and experience that would warrant further investigation
as case studies. Additionally, the questionnaire allowed
state DOT respondents to supply document links, refer-
ences to websites, or attachments that offered specific
DOT information on construction- and financial project
closeout. The survey questions inquired about (a) factors
causing project closeout delays, (b) implications of proj-
ect closeout delays, (c) project closeout durations (goals
and actual) for various highway construction delivery
Tummalapudi et al
methods; and (d) success factors that reduce project
closeout delays. The authors distributed the survey ques-
tionnaire electronically to the American Association of
State Highway and Transportation Officials Committee
on Funding and Finance, which includes representatives
from all 50 state DOTs. A total of 40 state DOTs com-
pleted the questionnaire (80% response rate). The
responses were then tabulated, evaluated, and supple-
mented with follow-up telephone calls and emails as
needed for clarification.
Case Studies
The data collected from the survey questionnaire were
used to draw conclusions about the factors affecting proj-
ect closeout, the implications of project closeout delays,
project closeout durations, and to identify DOTs for the
case studies. The authors conducted in-depth case studies
to gather specific information on the implications of not
closing out a project, the factors that delay project close-
out and lessons learned by DOTs in closing out highway
construction projects.
As stated, data collected from the literature review
and survey questionnaire were used to select the state
DOTs for inclusion as case studies. The DOTs qualified
for inclusion
based on the closeout processes in place, the compre-
hensiveness and availability of documents and data, and
the willingness of DOT staff to participate in the study.
Based on these qualification criteria, the authors initially
invited 13 state DOTs to participate in the study, of
which eight agreed: Connecticut, Florida, Georgia, Iowa,
Minnesota, Ohio, Oregon, and Texas. The case studies
involved structured interviews with state DOT staff that
had responsibilities associated with project closeout,
Figure 2. Factors that delay closing out highway projects (n = 40).
5
collecting DOT project closeout documents and reports,
and reviewing the findings with DOT staff for accuracy.
Using Oppenheim as a guide to develop the questions
(16), the authors undertook the case studies using the
protocol outlined above; the studies were conducted in
accordance with Government Accountability Office pro-
cedures (17).
Results and Discussion
The authors evaluated the data from literature review,
survey questionnaire, and case studies of eight DOTs to
investigate the factors that cause delays in highway con-
struction project closeout and the associated implications
of the delays. Following that, a set of strategies and rec-
ommendations for state DOTs and other public trans-
portation agencies to consider in relation to successful
highway construction project closeout were developed.
Factors Causing Closeout Delays
The factors that were perceived by DOTs to affect proj-
ect closeout negatively and cause delays fell under the
categories of project closeout documentation difficulties,
local utilities issues, project staffing issues, claims and
litigations, and funding source challenges. Several of the
factors that are barriers to completing project closeout
in a timely manner are shown in the survey results in
Figure 2. The top two responses of the 32 state DOTs
(80% of the responses) were difficulty in receiving
required closeout documentation and dealing with open
claims or litigation between the DOT and the contractor.
Other factors included changes in DOT personnel and
limited DOT staff availability (75% and 73% of the
6 Transportation Research Record 00(0)
Figure 3. Documents required for closing out highway construction projects (n = 40).
responses, respectively), limited DOT staff with closeout
experience (48%), missing testing information (48%),
missing certifications (45%), punch list taking too long
to complete (38%), and external stakeholders delaying
the process (35%). Overall, the barriers to timely project
closeout revolved around the construction process, the
required documents, as well as changes and a lack of suf-
ficient and knowledgeable staff being involved in the
project.
Project Closeout Documentation Difficulties. One of the signif-
icant delay factors identified in this study was the diffi-
cultly in receiving the required closeout documentation
in a timely manner from the various stakeholders typi-
cally involved in a highway construction project. The
projects generate many documents, reports, and informa-
tion that are critical for closing out, as the work has to
be reviewed to ensure compliance with the contract docu-
ments, as well as reviewing and verifying all payments.
Without proper documentation, closeout is difficult to
accomplish in a timely manner. Substantial completion/
acceptance documents, final estimates, final payment
applications, change order documentation, DBE reports,
material certifications, and as-built drawings were the
closeout documents required by at least 90% of the
responding state DOTs (Figure 3).
Missing or incomplete documentation at the end of a
project can trigger more involved processes and subsequent
lengthy delays as staff are required to gather missing docu-
ments or identify and rectify incorrect information. The
following list presents comments from the case studies con-
ducted in regard to closeout documentation issues.
 Incomplete or inaccurate information received
during the end stage of a project tends to delay
closeout as documents are not processed finan-
cially and accounts are not closed.
 When contractors are swamped with work, there is
less urgency to finish documentation, which causes
delays in the closeout and finalization process.
 Documents that are commonly missing or take time
to obtain are material test results and certifications.
 Delays in obtaining a proper and complete set of
as-built drawings at the end of projects.
 Changes in the contract may lead to incorrect cod-
ing that results in delaying the reconciliation of
final documents, which causes delays in project
closeout.
A documentation issue that was reported to frequently
slow down the closeout process related to DBE compli-
ance; this verifies whether DBE requirements have been
met and appropriate payments made. However, if the
requirements have not been met, then additional work
is required to close out the construction portion of the
project; this cannot progress to financial closeout until
all DBE issues have been resolved at the construction
level, which can cause considerable closeout delay. If
financial closeout documentation is incomplete, then
DOT staff will need to resolve this and justify the
Tummalapudi et al
resolutions, which can take considerable time, further
delaying the process.
Another aspect of closeout documentation was related
to labor compliance reports. State DOTs mentioned that
labor compliance involves multiple individuals and
approvals, which has an impact on the quality and quan-
tity components of project closeout. If any labor compli-
ance documents, such as certified payroll statements,
wage certification statements, or employee interview
reports are missing or incomplete, the project team will
need to find the information; this can take significant
time if labor was not tracked appropriately during con-
struction. In addition, for projects involving local enti-
ties, documentation becomes more difficult. State DOTs
reported that gathering agreements and documents from
local municipalities/entities takes longer than it should in
many cases because the local entities do not always see
the value in a timely closing out and may take their time
submitting documents. Local entities may not be using
electronic construction processes and instead rely on
paper-based processes, which can generate documenta-
tion delays and extend the project closeout process.
Issues with Local Utilities and Railroads. The utility companies
(e.g., railroards, power, water, sewer, etc.) and railroads
are one of the external stakeholders that can delay proj-
ect closeout. Coordination with the utility companies and
railroads tends to take time, and getting them to follow
DOT schedules can be difficult to accomplish. Payment
and expenditure disagreements between DOTs and the
utility companies and railroads, as well as receiving
invoices late from the them are major reasons that cause
delays in closing out projects. One DOT mentioned that
they often experience difficulties receiving timely invoices
from railroads, which delays closeout as all invoices and
payments must be completed beforehand.
Project Staffing Issues. Project staffing has proved challen-
ging for closing out projects at state DOTs: insufficient
project personnel, turnover/changes in personnel that
handle closeout, and a lack of staff knowledge/training
in the closeout process were reported. A few DOTs stated
that a lack of resources slows down the auditing process,
which then affects project closeout times. Some DOTs
stated that they have been unable to complete closeout
audits because of staff unavailability. Changes in project
personnel can also cause significant delays; with change,
issues can arise such as determining a payment for some-
thing that happened early on in a project, making com-
pletion harder to obtain. Other DOTs stated that by the
time a project is ready to closeout, proper notification
from the construction- or the DOT side may not occur,
for example, the original project manager may have since
7
moved to another position or left the DOT, and someone
new could be in charge who does not necessarily know
the project history or process to close out, causing signifi-
cant delays.
Claims and Litigations. Outstanding disputes and claims
can be expensive and can cause very long delays to clos-
ing out a project if not addressed properly and efficiently
(8). Claims and litigations occur in scenarios such as a
contractor disagreeing with the final estimate, determin-
ing that the DOT owes money or time for the work
undertaken. Resolution of these kinds of issues takes
time. Georgia DOT reported that if claims drag on, the
project ends up on an FHWA inactive list, which they
are unable to close out until the litigation is finalized.
Funding Source Challenges. Projects that have multiple
funding sources for highway construction tend to add
more work and complexity to the project closeout pro-
cess. State DOTs noted that the greater the number of
funding sources, the more documents, reviews, and
approvals needed, which all take time to complete, result-
ing in project closeout delays. In addition to this, locally
funded projects may experience longer project closeout
durations, as local municipalities may lack a formal clo-
seout process to follow. Georgia DOT reported that local
entities do not always prioritize the timely closing out of
a project, and if local match funding is a part of the proj-
ect, closeout takes longer because of resolving funding
issues.
Implications of Project Closeout Delays
Failure to close out projects promptly had produced sev-
eral consequences for the participating state DOTs,
including additional personnel resource allocations, fur-
ther project costs, contractor impacts, lost documenta-
tion, and the deobligation of funds. The repercussions
(that fell into these categories), which the state DOTs
had experienced as a result of closeout delays are listed
in Figure 4. Difficulty allocating resources to other proj-
ects or tasks, additional costs to the DOT, and negatively
affecting relationships with contractors were found to be
the top implications from project closeout delays accord-
ing to the survey respondents.
Additional Personnel Resource Allocations. Florida DOT
reported that delayed project closeouts had resulted in
resources being tied up in project closeout longer than
anticipated, which therefore could not be allocated to
subsequent responsibilities. Georgia DOT had found
that as project personnel change owing to long delays in
project closeout, documentation and information
8 Transportation Research Record 00(0)
Figure 4. Implications of not closing out projects (n = 40).
handoff may not occur, resulting in the new personnel
not knowing what has or has not happened at the earlier
stages. This type of situation requires the allocation of
additional resources for the closeout process that could
be used on other much needed projects.
Additional Project Costs. Project closeout delays lead to
additional fund requirements. The inability to allocate
resources comprehensively to other projects and respon-
sibilities costs the DOTs more money. The additional
costs are incurred in the resources needed for the extra
time, and for interest on delayed payments as contractors
have to wait longer for the release of the final payment
and retainage. Florida DOT mentioned that the more
time closeout takes, the greater the funding burden on
the agency; Florida State Law directs that any state
agency must pay third-party contractors within 30 days,
otherwise the amount will accumulate interest.
Connecticut DOT reported that they have expended
many hours on reconciling and closing out projects that
have been in the system for a long time, using funds that
could have been allocated to other work.
Contractor Impacts. Highway construction project closeout
delays affect the contractor’s final payment, retainage,
bonding capacity, and future work potential, because
part of their bonding is tied up in the closeout delay.
Such issues do not only jeopardize the immediate project
success and timely closeout but could have a particularly
detrimental impact on the DOT–contractor relationship
in future projects.
Deobligation of Funds. Highway construction projects that
receive federal aid could be at risk of losing out on
federal funding if a project does not close out efficiently
and is left inactive for a year after the project acceptance
end date. The deobligation of funds because of untimely
closeout leads to additional work identifying other
sources to cover the costs that were eligible for federal
funding. State DOTs mentioned this financial strain
from reconciling project costs to other accounts using
other funding sources. For example, the Ohio and
Pennsylvania DOTs noted that when projects take a long
time to close, they are unable to release associated funds
for use on other projects. Further, delays in project close-
out are likely to result in a reduction in the number of
projects that can be completed annually and the ability
to release federal funds to use on other projects.
Lost Documentation and Knowledge. Not tracking documen-
tation properly during construction and delays in project
closeout increase the possibility of losing critical docu-
ments. The loss of documentation could result in unsup-
ported or ineligible funding source costs. Additionally,
DOTs stated that the loss of knowledge owing to close-
out delays can be costly, with individuals moving on to
new projects, and others having to attempt to track down
documentation that had been produced several months
prior.
Success Factors for Timely Project Closeout
The DOT survey also aimed to identify the aspects of a
successful project closeout. Factors that were identified
as positively affecting the process are shown in Figure 5.
Most of these responses focused on the cooperation
between the DOT and contractor: 34 state DOTs (85%
of responses) acknowledged that the better the relation-
ship with the contractor, (e.g., collaborating, no claims
Tummalapudi et al
Figure 5. Success factors to reduce project closeout delays for highway construction (n = 40).
Figure 6. Percentage of construction complete when state departments of transportation (DOTs) begin planning for closeout (n = 40).
on the project, prompt receipt of documents), the more
efficient and rapid the closeout is to accomplish. Eighty
percent of state DOTs (32 responses) also mentioned
that having experienced and trained DOT staff handling
project closeout meant fewer delays and errors. In addi-
tion, nine state DOTs acknowledged that they use spe-
cific project closeout incentives/disincentives.
Recommendations and Strategies
Based on the information collected from the state DOTs,
recommendations and strategies for effective project clo-
seout were formulated and are provided here as a
resource for state DOTs.
Work as a Team to Complete Project Closeout. Coordination
and cooperation among the internal divisions of the
DOT and their external stakeholders are key to timely
9
project closeout. The project closeout should be a colla-
borative effort, including DOT construction and finan-
cial personnel as well as the contractor. This was
evidenced by Connecticut DOT, as their staff mentioned
that working as a team concurrently on the closeout
helped them solve problems early in the process and
saved considerable time. Another important factor in the
timely and successful completion of highway building
projects is team communication. All parties must be on
the same page and understand the significance of project
completion. This was endorsed by Florida DOT, which
mentioned that effective communication among their
teams allowed for greater transparency in project close-
out standards as well as a reduction in potential claims
that could delay the project closeout process.
Closeout Starts on Day 1 of a Project. The DOT survey indi-
cated that about 60% of the state DOTs begin to work
10
on the closeout process at the 80% to 100% project com-
pletion stage (shown in Figure 6). It is critical for state
DOTs to understand that closeout planning should begin
at the outset of the project and continue throughout the
construction phase. An effective documentation process
and consideration of end goals during the construction
phase of a project will result in a more efficient project
closeout. This was supported by Iowa and Florida
DOTs, who both stated that they saw favorable, success-
ful closeout outcomes when they had begun focusing on
the closeout process as soon as project had commenced.
One of the primary reasons for closeout delays is that
DOT staff perform the bulk of the closeout documenta-
tion at the end of the project. To manage this aspect,
project teams must have a positive attitude toward the
closeout audit and maintain current documentation from
Day 1 of the project, which ensures that auditing will be
largely complete by the end of the project, thereby mini-
mizing delays. State DOT project personnel usually have
high levels of enthusiasm during the initial stages of a
project and gradually lose that sense of urgency toward
the end. To ensure that projects are effectively closed,
state DOTs must encourage their personnel to maintain
the same level of eagerness and enthusiasm through to
the end of a project.
Implement Lean Initiatives in the Closeout Process. State
DOTs should explore implementing lean initiatives in
project management and in the project closeout process.
Lean initiatives assist with establishing process improve-
ments that aim to increase productivity when carrying
out construction processes. Several state DOTs high-
lighted the improvements realized from the use of lean in
the closeout process. By implementing lean initiatives,
Connecticut DOT involved their construction and
finance staff in identifying areas that often slow down
their closeout process. This resulted in the development
of a new closeout workflow that improved efficiency; it
also incorporates continuous improvements to further
streamline the process. Furthermore, DOTs should con-
sider using automated tools and electronic-based project
closeout systems that allow electronic sharing, reviewing,
signing, and approving documents, potentially saving
time compared with using paper-based processes.
Minimize the Number of Funding Sources Involved in a
Project. Highway construction projects can have one or
more funding sources. When projects have multiple
streams, in which all costs need to be reconciled, it com-
plicates the closeout and is likely to lead to project
delays. By keeping the number of funding sources to a
minimum, DOTs can make closeout easier, taking less
time to reconcile all the costs involved. Iowa DOT sup-
ported this finding, as they have had projects project in
Transportation Research Record 00(0)
the past with 12 or 13 funding sources, which reportedly
slowed down the project closeout process enormously.
Project Closeout Documentation Practices. State DOTs should
stay on top of the documents and reports required for
closeout to keep the project closeout duration within the
permissible time frame. They should adopt ways to either
incentivize stakeholders to submit documentation
promptly or disincentivize tardy submissions. Minnesota
DOT (MnDOT) substantiated this: since implementing
contractor disincentives for failing to meet documenta-
tion compliance within the specified dates, closeout times
have improved. Iowa DOT and MnDOT reported that
they withhold payments from contractors as a disincen-
tive until all the required work is completed and docu-
mentation submitted. Another project closeout issue that
the DOTs face quite often is the submission of the
required as-built drawings at the end of construction.
DOTs should adopt practices that encourage stake-
holders to create and submit as-built drawings during the
construction work rather than just at the end. To avoid
such delays related to as-built drawings, Florida DOT
made it mandatory to create as-built drawings as the
work is performed.
State DOTs should also stay on top of the project
finances. It is important to make sure the project team,
along with their field personnel, are monitoring and
tracking all costs throughout the construction phase.
Tracking how and when finance is used, and to whom
money is paid throughout the project will facilitate recon-
ciling the financial information at the end of the project
rather than having to go back and work this out after the
fact. The more the project team is aware of the finances,
the easier closeout will be. Having inspectors perform
audits as the work progresses helps to ensure project clo-
seout data and documentation are completed throughout
the construction phase, which reduces the efforts needed
at the end of a project.
Project Closeout Training. State DOTs should emphasize the
importance of project closeout to their employees and
give adequate training on their responsibilities related to
this. By spending significant amounts of time and finan-
cial resources on project closeout training, Texas DOT
observed the positive impact this had on employee mor-
ale and the improved project closeout efficiency. In addi-
tion to the field employees, it is important for DOT
executive leadership teams to acknowledge the impor-
tance of prioritizing project closeout and of providing
the required training resources to field personnel. This
aspect resonated with Ohio DOT: buy-in from the top
has provided Ohio DOT with the ability to disseminate
consistent messages, provide the required training, and
to roll out the improved project closeout process
Tummalapudi et al
statewide. With MnDOT leadership making closeout a
priority, a backlog of 400 project closeouts reduced to 20
within no time. Both these examples indicates the impor-
tance of leadership support in the timely closeout of
projects.
Project Closeout Performance Measures. State DOTs should
develop project closeout performance measures to track
metrics such as the total number of days between project
closeout milestones, the number of projects needing to be
audited, how many are on the FHWA inactive list, and
the number that have errors in the final packet, and so
forth. This could help DOTs track pending closeout
issues and motivate employees to stay on top of the issues
that need immediate attention in closing out.
Document the Closeout Process. It is essential that DOTs
document the closeout process, give succession planning
information to staff taking over, and ensure adequate
knowledge transfer. Documenting precise information
on the processes and procedures that each person has in
the closeout process will save significant time when clos-
ing out projects in the future. Furthermore, if personnel
have not worked on project closeout in a long time, there
could be a tendency to forget some of the process.
Having the procedures outlined for specific roles will
facilitate the efficiency of project closeout.
Conclusion
The project closeout process at state DOTs takes time
and involves several challenges. Delays in the highway
construction project closeout process has negative conse-
quences for all stakeholders. This study had three objec-
tives: (1) identify the major causes of highway construction
project closeout delays, (2) ascertain the implications of
the delays, and (3) provide recommendations for practices
that will reduce highway construction project closeout
delays.
The top reasons for delays in highway project closeout
were found to include difficulties in obtaining the neces-
sary closeout documentation, project staffing challenges,
claims/litigation between the DOT and contractor, and
challenges related to funding sources. Missing, incom-
plete, or inaccurate project documentation for material
test results/certifications, updated as-built drawings, labor
compliance reports, and DBE verifications from contrac-
tors delayed the closeout process. Local entities may not
use electronic construction processes, potentially resulting
in longer time frames for submission of the required doc-
uments, causing delays to closeout. DOT project staffing
issues such as insufficient project personnel resources, fre-
quent changes in project personnel, and a lack of staff
possessing knowledge of the closeout process slows down
11
project closeout. Claims and litigations occurring in final
estimate agreements, rework, and contractual changes
delayed the closeout process considerably. Having multi-
ple funding sources for a project requires multiple docu-
mentation and approvals that take time to complete, also
resulting in project closeout delays.
The consequences of project closeout delays included
additional personnel resource allocations, additional
project costs, contractor impacts, and the deobligation
of funds. When DOT personnel are tied up in a project
closeout longer than anticipated, additional resources
are then needed for other projects. Additional costs are
incurred from the resources needed for the additional
time, and on the interest on delayed payments as con-
tractors wait longer for the release of final payment and
retainage This also results in strained contractor–DOT
relationships. Untimely closeout further leads to the deo-
bligation of funds, meaning they are no longer available
for the specified project, resulting in a financial strain on
state DOTs.
To mitigate some of the highway construction project
closeout delays, it is recommended that DOTs start plan-
ning for closeout early in the project and continue through-
out the its life cycle. Further, collecting project closeout
documentation from Day 1 and developing strategies to
incentivize/disincentivize the project stakeholders in rela-
tion to submission of documents are recommended. State
DOTs could also provide project closeout training to their
personnel, provide succession planning information for
future staff, and ensure adequate knowledge transfer while
emphasizing the importance of timely closeout to all
employees. Finally, DOTs should identify the areas that
often slow down the closeout process and undertake pro-
cess improvements in the workflow, such as minimizing
the number of funding sources and using automated tools
and electronic-based project closeout systems.
This study has provided an overview of the causes
and implications of failing to close out highway con-
struction projects in a timely manner. The recommen-
dations and strategies provided are for state DOTs to
consider in making their closeout processes more effi-
cient to reduce the potential for delays during closeout.
Future research could explore different methods for
quantifying the impact of closeout delays and investi-
gate greater use of emerging technologies in the project
closeout process.
Author Contributions
The authors confirm contribution to the paper as follows: study
conception and design: C. Harper, T. Taylor; data collection:
M. Tummalapudi, C. Harper, T. Taylor, S. Waddle, R.
Catchings; analysis and interpretation of results: M.
Tummalapudi, C. Harper, T. Taylor; draft manuscript prepara-
tion: M. Tummalapudi, C. Harper. All authors reviewed the
results and approved the final version of the manuscript.
12
Declaration of Conflicting Interests
The authors declared no potential conflicts of interest with
respect to the research, authorship, and/or publication of this
article.
Funding
The authors disclosed receipt of the following financial support
for the research, authorship, and/or publication of this article:
The Transportation Research Board NCHRP Synthesis 20-05
Program sponsored this research, topic 51-17.
ORCID iDs
Manideep Tummalapudi https://orcid.org/0000-0001-9158-
1469
Christofer Michael Harper https://orcid.org/0000-0003-
3099-4555
Rachel Catchings https://orcid.org/0000-0001-7335-3745
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