ASCE has honored the writing team of Mohammad Ilbeigi, A.M.ASCE; Baabak Ashuri, Ph.D., A.M.ASCE; and Soheil Shayegh, Ph.D., S.M.ASCE, with the 2017 Thomas Fitch Rowland Prize for their paper “Price Adjustment Clauses and Submitted Bid Prices for Major Asphalt Line Items in Highway Projects,” published in the Journal of Construction Engineering and Management, May 2016.
The authors’ paper describes an investigation on the effectiveness of price adjustment clauses as a strategy to reduce costs for construction owners. Price adjustment clauses allow bid prices to be adjusted up or down to reflect changes in the costs of particular material cost indices, thus allowing the owner to share the risk of material cost fluctuations. The expectation is that bid prices will be lower, reflecting the reduced risk for material price fluctuations for the contractor. Price adjustment clauses have been of particular interest to transportation construction owners because many of the inputs into such projects are volatile. The analysis did not provide evidence that the presence or absence of price adjustment clauses had an effect on bid prices. However, other variables, such the price of asphalt cement and the number of bidders, did have an effect on the bid prices.
The Thomas Fitch Rowland Prize recognizes papers whose author describes in detail accomplished works of construction, or which are valuable contributions to cons
truction management and construction engineering.