cmaa owners forum may 3, 2010 ronaldo t. nicholson, p.e. chief engineer district department of...
TRANSCRIPT
CMAA Owners Forum
May 3, 2010
Ronaldo T. Nicholson, P.E. Chief Engineer District Department of Transportation
Past, Present, and Future
• USA Past
– National Road 1806 - 1839
– The Federal Aid Road Act of 1916,
(established a federal-state partnership)
– USA 1920’s and 1930’s
• Toll roads or “free” roads?
• Needs based or public works programs?
– Federal-Aid Highway Act of 1956
Past, Present, and Future
• The funding debate – Toll roads or free [taxed] roads?– A public works program or a needs based system?
• Bureau of Public Roads [FHWA]– 1939 Report to Congress– Fundamental premise of the Interstate Highway System– Toll roads would not satisfy all needs– Promoted tax based system of funding
Past, Present, and Future
Current Nationwide Transportation
Fund Trends
• Reliance on Federal funds increased
• Revenue was static
• Buying power diminished
• Maintenance and Operations Cost increased
• Transportation needs increased
Past, Present, and Future• Present Challenges
• The highway system is aging • Maintenance requires increasingly larger share of budget• Population and economy are growing• Current needs exceed available funds• A strong economy requires efficient transportation
For FY-10•Maintenance cost increased as services decrease•Construction funding remained static; •Down turn in economy was reflected by reduced state revenues
Owner’s Challenges
• Funding• 100-year tradition
– Design – Bid – Build• Means and methods• Design-Bid-Build are DOT’s most common project
delivery method• Match delivery method to project needs
D-B-B and DB and P3 are Fundamentally different
DB Time Savings
Public-Private Partnerships
• Policy– A public need for timely transportation development– Current methods may not be adequate– Private development or operation may be more
timely or more efficient or less costly – thereby serving the public interest
• Intent is to encourage private investment in transportation facilities– Innovative improvements– Investment of private funds/equity of funds not
otherwise available– Risk sharing
• Such partnerships are for carefully selected projects
Project Delivery OptionsProject Delivery Options
DesignBid
Build
DesignBid
Build
PrivateContract
FeeServices
PrivateContract
FeeServices
DesignBuild
DesignBuild
DesignBuild
OperateMaintain(DBOM)
DesignBuild
OperateMaintain(DBOM)
LongTermLease
Agreement
LongTermLease
Agreement
DesignBuild
FinanceOperate(DBFO)
DesignBuild
FinanceOperate(DBFO)
DesignBuildOwn
Operate(BOO)
DesignBuildOwn
Operate(BOO)
Public Agency ControlledPublic Agency Controlled Concessions / PrivatizationsMore Private Sector ControlConcessions / PrivatizationsMore Private Sector Control
Public Pays
Tax Exempt Financing
Public Control
Public Equity
Public Pays
Tax Exempt Financing
Public Control
Public Equity
User Pays
Taxable Financing
Private Control
Private Equity
User Pays
Taxable Financing
Private Control
Private Equity
Public Private PartnershipsPublic Private Partnerships
Deg
ree
of R
isk
Deg
ree
of R
isk
TimeTime
Project’s Life Cycle Risk ProfileProject’s Life Cycle Risk Profile
Development Design and Construction Operations & Maintenance
Legal
Legal
Financin
g
Financin
g
Politica
l
Politica
l
Environmen
tal
Environmen
tal
Sched
ule
Sched
ule
CostCost
Changes
Changes
Quality
Quality
O&M Costs
O&M Costs
Perform
ance
Perform
ance
Availa
bility
Availa
bility
Traffic
and R
even
ue
Traffic
and R
even
ue
FinancialClose
Startup-Turnover
P3 Risk/Cost Management
• P3 – lowest cost program delivery
– Parallel interests with Owner
– DB a phase prior to O&M
– Rewarded for managing life-cycle costs
– Business deal must make sense, but successful
relationship is essential
PPTA DB Contract Issues• Concession agreement between owner and
concessionaire• DB terms
– Contract between Concessionaire and DB– Concession agreement describes
• Scope• Reference standards• Relationship between Owner’s IA/IV and
Concessionaire’s independent engineer
PPTA Concession Agreement
• A comprehensive DBOM or O&M contract with single-source delivery
• Applies to various funding schemes– Public funds– Private financing– Mixed funding sources– Not limited to revenue positive projects
• Concessionaire is responsible for service delivery
Past, Present, and Future
• Future PPTA or P3s - A fundamentally different way of
doing business
– Long-term partnerships that accommodate change
– Shared risks/rewards based on effective, long-term
successful performance
– An important part of a DOT’s solutions – applicable to
select few projects
Industry’s Challenges• What is your business objective?
– Design - construct - get out
– DBOM - long-term stake in outcome
– P3 is fundamentally different
• Primary project delivery methods
– Design-Bid-Build
– Design-Build
– PPTA• Private companies can succeed or fail, and they do both
equally well
• Engineering is the easy part …
Public Perceptions
• P3 is not a panacea– Most roads are not attractive as an investment– Choose projects carefully– Create a fair and competitive procurement
environment– Optimize use of public and private funds
Other Virginia PPTA Efforts
• Mid-Town Tunnel, Petersburg Va
• Dulles Corridor Metro Extension, Fairfax Virginia
• US 460 Corridor Improvements, City of Suffolk Virginia to Prince George County Virginia
• Route 28 Improvements, Fairfax & Loudoun County Va
Current PPTACurrent PPTAVirginia Hot LanesVirginia Hot Lanes•Two separate projects in different stages:
–Capital Beltway –I-95/395
•Proposed 70-mile, seamless network•Adds new lanes to region’s most congested routes•Expands public transportation and carpooling•Provides new option to pay a toll for faster, more reliable trip time with a free alternative always available
Capital Beltway HotlanesContractual Arrangements
Capital Beltway Express LLC
Design-Build Contractor Operations & Maintenance
Consultants/Subcontractors Subcontractors
TMS Integrator – TBD
ETC System Integrator - TBD
Amended ReinstatedComprehensive Agreement
Design-BuildContract
O&MContract
• 14-miles of two new lanes in each direction
• Beginning this summer construction is expected to take 4-1/2 years
• Scheduled to begin operation in 2013
• Replacement of more than $260 million of aging infrastructure,
• including more than 50 bridges & overpasses, with pedestrian and recreational facilities. 70,000 lf of Soundwalls.
• Average toll expected to be $5-$6 during rush hour
Capital Beltway HOT LanesCapital Beltway HOT Lanes
11th STREET BRIDGE PROJECT
11th Street Bridge Project
11th street over the Anacostia River
PROJECT LOCATION IN DISTRICT OF COLUMBIA
22
Project Site
PROPOSED TRANSPORTATION IMPROVEMENTS
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KEY 11TH STREET BRIDGE PROJECT ASPECTS
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• Improve mobility through separate new freeway and local connections
• Provide shared pedestrian/bicycle path and streetcar rails
• Provide alternative evacuation route from Nation’s capital
• Include environmental investments
SOUTHEAST/SOUTHWEST FREEWAY
M STREET
SE
NAVY YARD
MARITIMEPLAZA
FREEWAYBRIDGES
LOCAL BRIDGE
GOOD HOPE ROAD
ANACOSTIAPARK
DC 295/I-
295
ANACOSTIA RIVER
MA
RTIN
LU
TH
ER
KIN
G J
R A
VEN
UE
SE
MULTI-MODAL TRANSPORTATION OPTIONS
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DESIGN-BUILD-TO-BUDGET
• Performed by an integrated construction contractor and designer (design-build team)
• Increases opportunities for innovation, flexibility, and cost-savings
• Allows construction to begin sooner after the project is awarded
• Differs from the traditional design-bid-build method in which project awarded to the lowest bidder for construction.
• $260 million design-build contract
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DESIGN AND CONSTRUCTION CONTRACTOR
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A joint venture of Skanska USA Civil of Alexandria, Va., and Facchina Construction of La Plata, Md