York County’s dilemma over soaring road construction costs: pay now or delay work?

Drivers should start to see work this summer on what could be the biggest road widening project yet undertaken by York County. But it’ll be years before they get to use those new lanes. Will it be worth the wait?

The Carowinds area project on U.S. 21 North and S.C. 51 in Fort Mill highlights a difficult question for area road experts. There are ways to combat skyrocketing construction costs. Employing them means road jobs would take longer, in an area that keeps growing.

“Those responses are like a sledge hammer,” said David Hooper, director of the Rock Hill-Fort Mill Area Transportation Study. “They may be the right thing to do, but they’re going to be messy.”

U.S. 21 and S.C. 51 widening update

In 2011, York County voters approved a $161 million Pennies for Progress referendum that included a $22.4 million widening of U.S. 21 North and S.C. 51. It connected to a Springhill Farm Road widening from the prior Pennies vote, in 2003.

Of the 24 road jobs listed on the 2011 ballot, the U.S. 21 and S.C. 51 project is among six that aren’t complete. S.C. 557 in Lake Wylie and Riverview Road in Rock Hill are under construction.

Planners are acquiring right-of-way for Mt. Gallant Road in Rock Hill. The final two are U.S. 21/S.C. 51 and S.C. 72 in Rock Hill. Both should go to bid in February, Pennies manager Patrick Hamilton said.

By January 2020, the expected cost of U.S. 21/S.C. 51 was up to $40 million. Last May the estimate was $50 million when the county put the project to bid.

It was the biggest project the county had advertised for bid, Hamilton said at the time. Larger projects like interstate exits are typically bid at the state level.

The county rejected the sole bid it received last June: the cost was about 40% higher than expected. Pennies opted to split the project in hopes of getting more bids, and more reasonable costs.

A new bid is expected in February just to clear the site and relocate utilities. That work, pending a successful bid, would start this summer. A new project would come in later to do the road widening of both highways.

“I’d say a good four years,” Hamilton said of the total project timeline, with a year of utility work followed by construction. “It’s basically two major projects.”

High construction costs for roads

Hooper’s group has a policy committee that includes the mayors of Rock Hill, Fort Mill and Tega Cay. There are elected officials from York and Lancaster counties on the panel too. Hooper outlined a long-range plan update process last week that group will complete this year, to include major road jobs needed the next two decades.

Policy committee members say that plan has to address high construction costs. “The challenges we’ve seen from cost overrides has been critical,” said York County Councilman Tom Audette.

York County Councilman Watts Huckabee pointed to the S.C. 160 interchange on Interstate 77. It followed interchange jobs at Gold Hill Road near Tega Cay and Exit 81 near the former planned Panthers headquarters site.

It’s ahead of planned work at Celanese and Cherry roads, and at Carowinds Boulevard. The S.C. 160 job grew in scope as projected costs increased.

But even after the layout change, increases grew from an estimated $72 million project to $115 million. Huckabee sees a problem where projects are so large they can’t get but one or two bidders.

“By the time we get to Carowinds and Cherry Road, we could’ve spent $700 million, $800 million just on one company bidding,” Huckabee said. “And they know they can put a number out that we don’t have any choice but to accept it.”

York County needs $16M more for I-77 upgrades at one of the area’s worst traffic spots

Tega Cay Mayor Chris Gray said some states require at least three bids and perhaps South Carolina should as well. On large projects, bonding requirements are too high for smaller companies to compete, he said. Gray proposes splitting some large jobs into more manageable chunks.

Another hammer that planners can use is to reject bids and hope companies will sharpen their estimates, Hooper said. The challenge is that route leads to longer projects.

“We don’t the ability to wait, because we’re growing so rapidly,” Hooper said.

COVID, road money influx bump up construction prices

The proposed strategies sound a lot like U.S. 21 and S.C. 51. The county rejected a bid. It was split into two separate phases for bidding. But still, drivers wait. And construction doesn’t generally get cheaper in time.

For years, road planners have used budgeting models that predict how much a road will cost in the year planners expect to build it. Until the past five or six years the model worked well, Hooper said.

Now historical inflation and present-day costs are diverging, he said.

COVID changed the equation. So did supply chain and workforce challenges. As more federal money pumped into road construction. In South Carolina, there were efforts to spread out new revenue from a 2017 gas tax increase over several years so prices wouldn’t balloon. Those efforts only worked so well.

All those factors combine to increase prices where road planners now get less for their money.

“We’re still seeing that in high-growth areas,” Hooper said.

Hooper’s group has to face the issue in deciding which roads to keep, or add, in the long-range plan update.

Hamilton has an even more imposing timeline. Pennies cost estimates are being formed now so a citizen commission can pick which roads, in either March or April, to put on a referendum ballot in November for the next project round.

Bidding and cost concerns impact everything from smaller road repaving in Pennies to large regional jobs like the anticipated U.S. 521 corridor widening in Indian Land or the Exit 82 configuration, where Cherry and Celanese roads meet Interstate 77 in Rock Hill.

Agencies can add more contingency money in their initial budgets, Hooper said. What they can’t do is ignore or unnecessarily delay road fixes.

Hooper referenced a few years back when Fort Mill was the fastest-growing town of its size and York County had the highest employment growth rate — both in the country. “Our friends who bid on projects are well acquainted with these facts,” Hooper said.