April 19, 2013
This User Manual is an educational resource part of FHWA's P3-VALUE Toolkit. The User Manual corresponds to the FHWA Risk Assessment Tool, providing a step-by-step overview of the risk assessment process with instructions for utilizing the Risk Tool at each stage. Together, these educational resources provide users with a better understanding of the process for identifying, evaluating, and allocating risks and for developing strategies to mitigate risks in a P3 project.
The information, examples, and process outlined in this User Manual do not encompass all issues and options for conducting a risk assessment for a highway P3 project. The Risk Assessment and Allocation Guidebook being developed to supplement FHWA's P3-VALUE Toolkit contains additional information and Appendix D of this User Manual provides references and resources from domestic and international jurisdictions for further guidance.
The Risk Assessment Tool has been designed for use in FHWA-sponsored training. FHWA anticipates that at the conclusion of the risk assessment training, users will have a greater understanding and appreciation of the risk assessment process and of several key considerations when developing and conducting an assessment. FHWA encourages users to engage appropriate experts (either in-house or external) to develop their own risk assessment tools and processes for potential P3 projects. The level of knowledge gained from this training should help in such an effort.
To provide a notional example of a functioning and interactive Risk Assessment Tool, a number of assumptions and formulas are included in the Risk Tool that relate to the pre-populated "Example Scenario" and may not be suitable for all types of potential scenarios. For example, the "Example Scenario" does not include toll collection in its delivery structure and consequently the Monte Carlo simulation does not directly accommodate revenue risks, though P3-VALUE users can address revenue risks through their selection of a discount rate in the PSC and Shadow Bid Tools. Additionally, the Monte Carlo simulation is based on the assumption that all risks are independent, with no correlation between the risks.