ate at least $11.6 billion in revenues over
the course of the contract—producing a
potential profit of $9.58 billion.
Diaz argues that feeding dollars
through the government system and
then spending what’s left on infrastructure makes little sense. Rather, private
enterprises should spend and value on a
profitability scale. Even the Port Authority
itself “should function less as a bureaucratic
organization and more like a Board of
Public Utilities endeavor that is overseen
only by representatives from New York and
New Jersey, but is ultimately responsible for
its own profitability,” he relates.
LePatner & Associates founder Barry
LePatner agrees that skyrocketing costs
are to blame for the state’s lackluster
infrastructure spending. “Boston’s Big
Dig was slated to cost $2.8 billion in
1985,” he says. “By the time it was done,
in 2006, it cost Massachusetts taxpayers
$14.6 billion. The New Meadowlands
Stadium was supposed to cost $800 mil-
lion. Turns out it cost $1.7 billion.”
tion; and fairly apportion anticipated
construction-related risks among all parties.
Reprint orders: www.remreprints.com
“The aver-
age project
wastes up to
50% of its
total labor
cost. Yet
fixed-price contracts
would save billions.”
BARRY LePATNER
LePatner & Associates
LePatner argues that inefficiencies in
the trillion-dollar construction industry
cost the country $120 billion a year, an
effective $2,000 tax on a family of four.
“Construction is America’s least-produc-
tive industry,” he says. “The average
project wastes up to 50% of its total
labor cost. Taxpayers cannot afford to
squander $100 billion on poor job per-
formance. Yet fixed-priced contracts
would save billions.”
Construction contracts, LePatner says,
should be based on 100% complete
architectural and engineering drawings;
include fixed prices for everything
designed and approved by the jurisdic-
