Presentation

Speakers

• Dusty Holcombe, Deputy Director of the Office of Transportation Public Private Partnerships for the Commonwealth of Virginia
• Matthew (Matt) E. MacGregor, P.E., Texas DOT Dallas-Fort Worth Strategic Projects Office - Procurement.
• Leon Corbett, Project Finance Manager, Florida Department of Transportation
• Paul Lampley, I-595 Construction Project Manager, Florida Department of Transportation
• Brett Jackson, Major Projects Coordinator and Locally Administered Projects Program Manager, FHWA Texas Division.
• Anita N. Wilson, Urban Program Engineer, FHWA Texas Division
• Patrick Decorla-Souza, FHWA P3 Program Manager

Introduction

• Patrick Decorla-Souza, FHWA P3 Program Manager

General / Outreach & Communication

• Paul Lampley, I-595 Construction Project Manager, Florida Department of Transportation
• Leon Corbett, Project Finance Manager, Florida Department of Transportation
• Matthew (Matt) E. MacGregor, P.E., Texas DOT Dallas-Fort Worth Strategic Projects Office - Procurement.
• Virginia DOT Perspective

Tolling & Management Lanes

• Matthew (Matt) E. MacGregor, P.E., Texas DOT Dallas-Fort Worth Strategic Projects Office - Procurement.

Contract Performance

• Dusty Holcombe, Deputy Director of the Office of Transportation Public Private Partnerships for the Commonwealth of Virginia

Federal Requirements

• Anita N. Wilson, Urban Program Engineer, FHWA Texas Division
• Brett Jackson, Major Projects Coordinator and Locally Administered Projects Program Manager, FHWA Texas Division.

Texas DOT Public Information Presentation (Supplementary Material)

• Selma Stockstill, Texas DOT
• Tony Hartzel, Texas DOT
• Jodi Hodges, Texas DOT

Advanced P3 Training Case Study: Colorado

April 25, 2012

An Advanced Webinar - Building Upon P3 101

• Topic areas focusing on lessons learned :
  • General / Outreach & Communications (FDOT)
  • Tolling and Managed Lanes (TxDOT)
  • Contract Performance (VDOT)
  • Federal Requirements (FHWA - Texas Division)

General / Outreach & Communication

Florida DOT
Paul Lampley
Leon Corbett

• Key Questions
  • What are the essential ingredients for a successful partnership?
  • How do other DOTs deal with the substantial pre-development cost of P3s?
  • What successful examples are there about DOT public outreach and communications regarding P3s?

Florida Department of Transportation

I-595 Express Corridor Improvements Project

Paul A. Lampley, P.E. / I-595 Project Manager
Leon Corbett / FDOT Project Finance Manager

Outline

1. I-595 DBFOM Overview
2. Pre-development Costs of P3s
3. Building a Long Term Partnership
4. Successful P3 Outreach

PROJECT DESCRIPTION

• $1.8 Billion, 35-year Concession Agreement (DBFOM)
• 5 year design/construction period, 35 year operations/maintenance period
• 13 mile corridor (10.5 miles on I-595, 2.5 miles on Florida's Turnpike)
• Availability Payments

PRE-DEVELOPMENT COST OF P3S

• Costs Programmed by FDOT
  • Planning
  • NEPA
  • Known Right Of Way Needs
  • Expertise to Team (Consultants)
    • Design Team (RS&H)
    • Financial/ Technical Team (Jeffery Parker & Assoc.)
    • Toll and Revenue Team (WSA)
    • Procurement Team (Nossaman LLP)
  • Research
    • Meet with Industry Representatives
    • Research similar projects worldwide
  • Costs Transferred to the Concessionaire
    • Any Additional Right of Way
    • Utility Relocations
    • Clean up of Contamination
      • May include cost sharing
    • Operations and Maintenance

LONG TERM PARTNERSHIPS

• A successful partnership isn't developed over night or with the signing of a contract but is a process that requires Respect, a level of Trust, and Fairness
• Each party must have Mutual project goals and Support from the highest level
• The owner can assist in key areas by:
  • Developing and publishing a business plan with measurable results
  • Coordinating with elected officials, local governments, and resource and regulatory agencies
  • Coordinating internally to modify internal policies, procedures and processes to facilitate a P3
  • Remaining open and flexible as well as clear, consistent, and persistent
  • Being proactive and transparent
  • Assisting the team through workshops to find mutually acceptable solutions

P3 OUTREACH - STATE GOVERNMENT

• Statutory authority and controls are key to a successful P3 program
  • Section 334.30, Florida Statutes
  • 15% cap
  • Cost effectiveness evaluation
• Stakeholder education is a continuous process
• Provide program summaries and updates

GENERATING LOCAL SUPPORT FOR A P3

• Pre Construction
  • One-on-One Meetings with ALL Elected Officials
  • Individual Neighborhood Meetings & Noise Workshops
  • Project Open Houses and Groundbreaking
• During Construction
  • Project Logos and branding lets local business owners know who their customers are
  • Frequent Project Updates at Established Meetings
    • Homeowners' Associations, Civic Associations, Chambers of Commerce, Municipal Agencies, Schools
  • Corridor Advisory Committee
  • Social Media
    • Twitter, Facebook, e-Newsletters, FDOT Website (Google Earth), Concessionaire Website
• A Successful Partnership Includes the Public Involvement Team
  • Public Involvement Representatives for both Owner and Concessionaire
  • Clear, consistent and proactive messaging is key
• Use Outreach Strategies from Planning and PD&E during Construction
• Build Mutually Beneficial Relationships with Local Media
  • Share your news- good and otherwise
• Focus on Local Messages
  • Creating local jobs
  • Stimulating the local economy with project team patronage
  • Providing Noise Abatement
  • Expediting Construction
  • Realizing overall Cost Savings
• What's Good for the Community is Good for the Partnership
  • Disadvantaged Business Enterprise (DBR) Registration
  • Contractors' Breakfast
  • Charitable Programs / Giving
  • Volunteering in Neighborhood Activities

P3 BENEFITS/CHALLENGES

• Benefits:
  • Public can utilize the facility sooner than later
  • Economy of scale and price stability
  • Mechanism to fill funding shortfall
    • Private equity
    • Global capital markets
  • Outside engineering and management expertise
  • Risk Transfer
• Challenges:
  • Perceived loss of control
  • "Cherry picking" by private sector
  • Owner learning curve
  • "Real" transfer of risk will cost REAL money

www.I-595.com

General / Outreach & Communication

Texas DOT & Virginia DOT Perspective

Texas Experience Matt MacGregor

Past - Complete

1. CTTS (Seg 1-4 / SH 45 North & South

Present - Underway

2. Segment 5-6
3. DFW Connector
4. North Tarrant Express (NTE)
5. LBJ Express

Future - RFI - RFQ

6. Grand Parkway
7. Horseshoe
8. I-35E
9. SH 183
10. 3A/3B (Negotiating)

Texas Perspective

1. Pre-development Costs of P3s
   • Owner has to bear most of these costs
2. Building a Long Term Partnership
   • Working on it - Have a similar partner
3. Successful P3 Outreach
   • See next slide

Public Involvement in Texas: Lessons

• PI efforts on DB projects go beyond typical TxDOT practice
• $1B project needs own PI staff to focus on stakeholder needs
• Project website and constant stakeholder contact is paramount
• Things change too quickly for conventional methods on events such as traffic switches
• A good contract is good for everyone - expectations established
  • PICP
  • Crisis Communications
  • Outreach plans
  • Events
• Be prepared to adapt
  • Lane closure format on website has changed three times or more in 18 months
  • Having a good partnering attitude benefits everyone
  • Storefront
  • Speed limit/ work zone safety

Entire Presentation has been included

Questions

Submit a question using the chat box or dial *1 to call in your question by phone

Tolling and Managed Lanes

Texas DOT
Matt MacGregor

• Key Questions
  • Are the same policies (e.g., toll policies) that govern DOT-operated projects also applicable to P3-operated projects?
  • Are there any good examples of revenue sharing P3 projects?
  • What are lessons learned (good and bad) from other P3 managed lanes facilities?
  • Are the same policies (e.g., toll policies) that govern DOT-operated projects also applicable to P3-operated projects?
    • This is our challenge in North Texas - Preferred from a customer delivery standpoint. May be some cost savings on DOT projects - See slide for overview
  • Are there any good examples of revenue sharing P3 projects?
    • We have an example we have included for two managed lane projects and one toll road project - See slide for a graphical look
  • What are lessons learned (good and bad) from other P3 managed lanes facilities?
    • Toll Servicing Agreements, Transaction Costs, Interoperability and many more topics need to be discussed early and often

Many P3 Projects in Texas

Past - Complete

1. CTTS (Seg 1-4 / SH 45 North & South

Present - Underway

2. Segment 5-6
3. DFW Connector
4. North Tarrant Express (NTE)
5. LBJ Express

Future - RFI - RFQ

6. Grand Parkway
7. Horseshoe
8. I-35E
9. SH 183
10. 3A/3B (Negotiating)

Operations, Signage, Toll and Managed Lane Pricing Policies Should be Similar

• Provide statewide consistency which permits some regional customization
  • DFW, Houston, Austin and El Paso are actively operating/developing managed lanes and toll road facilities.
• The DFW area will have P3 managed lanes, Public operated managed lanes and an existing HOV System that is likely to be priced
• A driver may use one or more of these facilities in their daily commute
• Simplification and uniformity are a primary consideration - A work in progress
• Priced projects are required to be tied to goals, performance goals, measurement, monitoring and reporting programs - i.e. ELDP Program

Managed Lane Operating Strategies Versus Objectives

 

Revenue Sharing

• Included in both of our current P3 managed lanes projects - LBJ Express and NTE
• Included in our Segment 5-6 toll road project in a similar manner
• Public-Public Partnerships can also include revenue sharing - i.e. Eastern Extension of PGBT is set at 80% to NTTA, and 20% to TxDOT of the gross toll

Revenue Sharing What does it mean?

 

Tolls, Transaction Costs & Interoperability Fees What is it all about and how does it work?

 

Tolling & Managed Lanes

Florida DOT & Virginia DOT Perspective

Questions

Submit a question using the chat box or dial *1 to call in your question by phone

 

Contract Performance

Virginia DOT
Dusty Holcombe

Contract Performance

• Key Questions
  • How do other DOTs deal with maintenance responsibilities on P3 concessions?
  • Are there any examples of a DOT requiring that it provide maintenance services (for a price) to a P3 concessionaire?
  • How do other states handle maintenance, etc., when some lanes in the facility are owned by the DOT and other lanes are owned by a P3?
  • How is construction oversight handled when multiple owners are involved?
  • If the concessionaire is not profitable and hands the facility back in a few years are there changes in the way the state oversees the construction? Other things done differently if this is a possibility?

Key Questions

• Contract Performance - OTP3 - Virginia
  • How do other DOTs deal with maintenance responsibilities on P3 concessions?
    • Scope
      • Brownfield v. Greenfield
      • Adjacent Facilities
    • Risk
      • Best able to manage
      • Cost - Value for Money
    • Performance Regime
      • Technical Requirements
      • Non-compliance Points
• Contract Performance - OTP3 - Virginia
  • Are there any examples of a DOT requiring that it provide maintenance services (for a price) to a P3 concessionaire?
    • Snow/Ice Removal
    • Bridge Inspection
    • Shared Facilities
      • Bridges
      • Lighting
      • Barriers
    • Tolling - Backroom/E-Z Pass
    • Virginia State Police
      • Visual Enforcement
      • Incident Response
    • Drainage
• Contract Performance - OTP3 - Virginia
  • How do other states handle maintenance, etc., when some lanes in the facility are owned by the DOT and other lanes are owned by a P3?
    • Prior to Procurement
      • Memorandum of Agreement - Responsible Public Entity
      • Roles and Responsibilities
      • Identification of Assets
    • Contract Documents
      • Comprehensive Agreements
      • Technical Requirements
• Contract Performance - OTP3 - Virginia
  • How is construction oversight handled when multiple owners are involved?
    • Owner's Oversight Plan
      • Project Development Plans
      • QAQC Plan
      • Performance Requirements
      • Handback Requirements
    • Conflicting Interests?
      • Who is taking Long-Term O&M Risk?
      • DB Contractor v. Operator
• Contract Performance - OTP3 - Virginia
  • If the concessionaire is not profitable and hands the facility back in a few years are there changes in the way the state oversees the construction? Other things done differently if this is a possibility?
    • Plan to Succeed, Prepare for Other Events
      • Project Development
      • Contract Documents
      • Contract Administration

Contract Performance

Florida DOT & Texas DOT Perspective

Key Questions - Texas Perspective

• Contract Performance
  • How does TxDOT deal with maintenance responsibilities on P3 concessions?
    • Developer is responsible through the term and it includes hand back requirements
  • Are there any examples in Texas of requiring that it provide maintenance services (for a price) to a P3 concessionaire?
    • Not in Texas yet; over time there may opportunities for this to occur
  • How does Texas handle maintenance, etc., when some lanes in the facility are owned by TxDOT and the Managed Lanes are "leased" by a P3?
    • Developer maintains the toll/managed lanes; yet to be seen how well it works
    • Segment 5-6 will be the first attempt at this being done on a completed project
  • How is construction oversight handled when multiple owners are involved?
    • Through agreements with those owners
  • If the concessionaire is not profitable and hands the facility back in a few years are there changes in the way the state oversees the construction? Other things done differently if this is a possibility?
    • Hope we don't have to find out; we anticipate similar transitions as traditional projects just larger in scale and magnitude

Questions

Submit a question using the chat box Or Dial *1 to call in your question by phone

Federal Requirements

FHWA - Texas Division

Federal Requirements

• Key Questions
  • What Federal requirements apply?
  • What are state DOT's experiences in attempting to meet those requirements?

Texas Division - Federal Requirements and Oversight for P3 Projects

• TX Experience
  • Contracting Methods Used to Date
    • Design-bid-build
    • Design-build
    • Design-build with capital maintenance agreements
    • DBFOM (P3 or Comprehensive Development Agreements)
    • Unsolicited/Solicited Proposals
    • Any and all funding mechanisms have been used to date.

Texas Division P3

• Project Examples
  • SH 130 D-B with maintenance agreement ($1.4 billion 50 mile toll road new alignment with TIFIA assistance)
  • SH 130 extension using P3 with TIFIA assistance ($1.1 billion toll road, 40 miles new alignment)
  • NTE and LBJ P3s with TIFIA assistance ($2.5 billion and $2 billion, 12 and 13 miles respectively)
  • DFW Connector, D-B with maintenance agreement ($1.2 billion, 4 major interchanges)
  • 183A, D-B with TIFIA ($320 million new alignment toll road)

Texas Division P3 - Tools for Your Use

• Developed a draft SOP for P3 and D-B
  • Generally follows 23 CFR 636
  • Provides direction for new staff or inexperienced in P3 and or D-B
• Project Specific Oversight Agreements between the State and FHWA
• Major Projects SOP

Texas Division P3 - Lessons Learned

• Areas of focus and lessons learned
  • Pay attention to conflicts of interest and firewalls on various teams
  • FHWA involvement requires intensive reading and meetings during the procurement process
  • Be involved early and often in developing schedules as assumptions are often made for State and Federal involvement, review times, approval actions, etc.
  • Advise against Tiered environmental process

Texas Division P3

• Lessons learned continued
  • Process is much easier when NEPA is completed, but State tends to push the envelope with parallel processes (again, schedule)
  • Quality Assurance Programs
    • State is pushing the envelope in being less involved and providing less oversight by using an independent engineer and allowing for contractor acceptance testing
    • Establish dispute resolution process early and follow it
    • Any deviations from 23 CFR 637 must be approved by DO

Texas Division P3

• Noticing a trend of "downsizing" of projects due to funding shortfalls -- this brings purpose and need into question
• Timing of deliverables such as Toll agreements, Financial Plans, Project Management Plans, TIFIA loan execution, etc.
• Public involvement and education on the P3 process is PARAMOUNT

FHWA Division Office "Top Requirements Concerns"

• The use of contractor's test results for materials acceptance on P3 projects and what that means with respect to a QAP in accordance with 23 CFR 637B
• If a project has Federal monies or a Federal nexus such as work on the Interstate, then it is a "Federal" project and all requirements apply just as with a Design-bid-build project

Regulatory Concerns Continued

• Value Engineering must be performed prior to the final request for proposals - 23 CFR 627.9(c)
• Major Projects Requirements
  • Financial Plan
  • Major Project Plan
  • Cost Estimate Review
• Contact:
  • Brett Jackson, (512) 536-5946, brett.jackson@dot.gov

Federal Requirements

Florida DOT, Texas DOT, Virginia DOT Perspective

Questions

Submit a question using the chat box Or Dial *1 to call in your question by phone