AASHTO RESEARCH ADVISORY COMMITTEE PROVIDENCE, RI JULY 27, 2016 ISSUES ENCOUNTERED BY INDUSTRY IN THE RESEARCH DEVELOPMENT AND MARKETING OF INNOVATIVE TRANSPORTATION PRODUCTS AASHTO RESEARCH ADVISORY COMMITTEE PROVIDENCE, RI JULY 27, 2016

fhwa assembled a review team to examine their patented and proprietary products program FHWA Review team met with ARTBA Task Force members (below) on May 16, 2016 John Hillman, HCB Mike Stenko, Transpo Industries Mark Henderson, LJB Lester Hensley, EMSEAL Len Toenjes, AGC of Missouri Eric Hedman, 3M Kevin Groeneweg, Mobile Barriers

Driving force for private industry to develop new products: Full fill a current transportation industry need Develop a unique product to meet the need Patent new product for protection Gain acceptance by agencies for product use

First obstacle in the acceptance of a new product: Federal Legislation 23 CFR 635.411 – Material or Product selection (a) Federal funds shall not participate, directly or indirectly, in payment for any premium or royalty on any patented or proprietary material, specification or process specifically set forth in the plans and specifications for a project, unless: (1) Such patented or proprietary item is purchased or obtained through competitive bidding with equally suitable unpatented items; or (2) The State transportation department certifies either that such patented or proprietary item is essential for synchronization with existing highway facilities, or that no equally suitable alternate exists; or (3) Such patented or proprietary item is used for research or for a distinctive type of construction on relatively short sections of road for experimental purposes. (cont.)

First obstacle in the acceptance of a new product Federal Legislation 23 CFR 635.411 – Material or Product selection (c) A State transportation department may require a specific material or product when there are other acceptable materials and products, when such specific choice is approved by the Division Administrator as being in the public interest. When the Division Administrator’s approval is not obtained, the item will be non participating unless bidding procedures are used that establish the unit price of each acceptable alternative. In this case Federal-aid participation will be based on the lowest price so established.

The task force noted these different impediments stemming from 23 CFR 635.411: Inconsistent applications among the States State Resistance to Initiate Public Interest Findings A Fallacy of Competition Benefits of Patented Products aren’t recognized

The task force had the following recommendations: Include Proprietary Products as part of Every Day Counts(EDC) Program Publicize a Proprietary Products Best Practices Link APEL and National Public Interest Finding Reform/Repeal 23 CFR 635.411

AASHTO – TSP2 (Transportation System Preservation Technical Services Program) Conducted surveys of private industry and state departments of transportation: 25 Industry Responses 24 State DOT Responses

INDUSTRY PERSPECTIVE 98% of manufacturers surveyed introduced less than 5 new products in last 5 years 68% Marketed new product to 1-5 State DOT’s No consistency between states (Specs & QPL process) Lack of State DOT Specs Limited field test opportunities Unknown Return on investment Research/Development/Acceptance Some DOT’s not open to innovation Risk Adverse DOT

DOT PERSPECTIVE Service Life Extension Ease of Use Speed of Application Lower Costs Environmental Benefit Enhance Safety

What can be done to encourage research and development by Industry: Establish Regional/National evaluation and acceptance protocols Expand DOT usage of data from the NTPEP (National Transportation Product Evaluation Program) and APEL (AASHTO Product Evaluation List) Data for State DOT Product approval Data Base of Product usage and approved product from State DOTs Simplify approval process Standardize procedures for evaluation/approval Increase Communications between industry and DOT Use of Public Interest Findings

Michael S. Stenko, CEO Transpo Industries, Inc mstenko@transpo.com THANK YOU Michael S. Stenko, CEO Transpo Industries, Inc mstenko@transpo.com