I would like to add my two bits worth to what Erik said, based on my experience with National Forest roads. All new construction has always been contracted, for the reasons Erik enumerated. Reconstruction was occasionally done by "force account" crews, but was usually included in a Timber Sale Contract or was contracted directly, depending on the complexity of the project. But when I first started with the F.S. vertually all road maintenance was accomplished with F.S. crews. This worked well, the roads were generally in good shape and emergency repairs were quickly accomplished. Later, when budgets started shrinking, the force account road crews were some of the first to go, and most of the maintenance work was also contracted. This was indeed cheaper, but the main reason was that most of the smaller projects were simply not done. On larger projects the contractors did a good job and were cost effective, but it was not worth the time and expence to put up a contract for small jobs. The result of this was a general deterioration of the road system. In fact, one of the last jobs for remaining F.S. road crews was closing roads that could no longer be maintained in a safe condition.
On thing to remember about contracting is that you must have personel to prepare and administer the contract, and these people must be familiar with the work to be contracted. The S.V. once contracted a survey and preliminary design project, and the personel assigned to administer the contract were unfamiliar with both surveying and contracting. The result was that the contractor did about half of what they were supposed to do.
The bottom line is still the bottom line however and, as Taylor pointed out, if you don't have the money to pay full time employees then you will have to contract whatever work you can afford. That way you get more bang for the bucks, but fewer bangs.
