Skip to content

Public-Private Partnership Peer Exchange Webinar

April 25, 2012
Related Materials

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

Center for Innovative Finance Support AcademyAdvanced 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?

construction photoFlorida 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
I-595 from I-75/Sawgrass Expressway Interchange to west of the I-95 Interchange and Florida's Turnpike from Griffin Road to Peters Road

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)
    • Traffic photoResearch
      • 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
  • construction photoThe 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

Traffic photo

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
  • Traffic photoDuring 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
    • construction photoStimulating 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

  • construction photoBenefits:
    • 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

Map of Texas past, present and complete projects

Past - Complete

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

Present - Underway

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

Future - RFI - RFQ

  1. Grand Parkway
  2. Horseshoe
  3. I-35E
  4. SH 183
  5. 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

computer iconTelephone icon

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

Map of Texas past, present and complete projects

Past - Complete

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

Present - Underway

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

Future - RFI - RFQ

  1. Grand Parkway
  2. Horseshoe
  3. I-35E
  4. SH 183
  5. 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

Complex graph of strategies

 

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?

 

Revenue Sharing

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

MCj04149760000[1]

 

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

computer iconTelephone icon

 

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?
      • traffic photoScope
        • 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?
      • map of areaSnow/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?
      • team work cartoonPrior 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?
      • traffic photoOwner'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
    • teamwork clip artIf 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

computer iconTelephone icon

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:

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

computer iconTelephone icon
back to top