virginia p3 update- 2015• includes maintenance, safety improvements for existing midtown and...

VIRGINIA P3 UPDATE- 2015

Jackie Cromwell, VAP3

VIRGINIA LEADERSHIP IN PUBLIC-PRIVATE PARTNERSHIPS

• PPTA enabling legislation 1995

• Numerous revisions to PPTA Guidelines over time

• Creation of VAP3 office in 2010

• 2014 – Substantial update to PPTA Implementation Manual & Guidelines

• Goal is to build strategic program, extend VAP3 leadership

• Virginia is a national leader and 2nd globally in P3 project development

I-95 & I-495 EXPRESS LANES PROJECTS

I-495 Express Lanes • Opened to traffic November 2012 • Virginia’s $409 million investment

leveraged a $1.9 billion project • Transurban increased its equity

investment in 2014 • Over 10 million users in first two years I-95 Express Lanes • Opens in December 2014 • Virginia contribution of $71 million

leveraged $925 million project • Adds to managed lanes system that

include I-495 Express Lanes

ELIZABETH RIVER TUNNEL PROJECT

• Two-lane tunnel connects Norfolk and Portsmouth

• Parallels existing Midtown Tunnel under Elizabeth River

• Includes maintenance, safety improvements for existing Midtown and Downtown Tunnels, extension of MLK Freeway

• VDOT maintains ownership and oversight

• Private partner ERC will finance and build facilities, operate and maintain for 58-year concession period

https://www.driveert.com/wp-content/uploads/2012/01/Preferred-ERC-Project-Map-with_GantriesB.pdf

PARTNERSHIPS CREATE HUGE PUBLIC BENEFITS

P3 Project Project Cost State Contribution

% of Total Cost

Jobs Supported

Economic Activity

495 Express Lanes

$ 1.9 B $ 409 M 22 % 31,000 $ 3.5 B

95 Express Lanes

$ 925 M $ 71 M 7.6 % 8,000 $ 2 B

Midtown Tunnel

$ 2.1 B

$ 420.5 M

20 %

1,700

$ 170-254 M

Total Benefits $ 4.9 B $ 901 M 18.4 % 40,700 jobs ~ $5.7 B

CHANGES IN PPTA PROCESS

• 2012 PPTA Implementation Manual and Guidelines were used as foundation to solicit 100+ responses

• Key responses were:

– Broad cross section of respondents – Overwhelmingly positive – Both broad and specific – Included in new 2014 PPTA Manual & Guidelines

• Comments were incorporated in 2014 PPTA Implementation

Manual and Guidelines – Guidelines including VfM, Risk, and Public Engagement are currently

being updated and released for public comments

PPTA PROJECT DELIVERY FRAMEWORK

*Parties to be notified and briefed upon request after the Oversight Board decision: ‒ Chairs of General Assembly committees ‒ MPO’s ‒ Interested members of General Assembly ‒ Special interest groups ‒ Regulatory Agencies ‒ Public

Briefing Focus: ‒ RFI results (as appropriate) ‒ Schedule ‒ Refresh on the high points from Project Development ‒ Preliminary Procurement documents ‒ Risk Analysis and Value-for-Money ‒ Estimated project cost ‒ Potential public subsidy ‒ Potential economic benefits ‒ Preliminary Business Points ‒ Initial Finding of Public Interest

Briefing Focus: ‒ Detail-Level Screening Report ‒ Desirability as P3 ‒ Feasibility as P3 ‒ HB 2 Prioritization ‒ Duration of P3 development and procurement

Briefing Focus: ‒ Major Business Points ‒ Updated Risk Allocation & Management Plan ‒ Statutory Audit results ‒ Final Value-for-Money Analysis ‒ Updated economic benefits ‒ Project bid results ‒ Public subsidy (if required) ‒ Final Finding of Public Interest

Draft and Final Contract Documents posted on P3 Website for review & comment

Final Contract Documents posted on P3 Website

KEY CHANGES IN 2014 PPTA MANUAL & GUIDELINES

Increase Transparency • Brief Oversight Board at their public

meetings • Findings of Public Interest • Brief General Assembly

Transportation Committee Chairmen

Enhance Competition • Coordinate P3 process with HB 2 • Additional review when there is only

one proposer • Additional review if material change

in project scope or risk allocation

KEY CHANGES IN 2014 PPTA MANUAL & GUIDELINES

Increase Public Engagement • Develop P3 Public Engagement

Guidelines • New VAP3 website information • 24/7 website comment opportunities

Improve Risk Assessment and Management

• Revise Risk Management Guidelines • Include risk workshop and

discussions, risk registers and risk management plans

PPTA Steering

Committee

Project Development

Returned to Agency or Proposer

Unsolicited P3 Projects

Detail-Level Screening with

Recommendations

Policy Review with Recommendations

Solicited P3 Projects

Oversight Board*

Agency

NO

High-Level Screening with

Recommendations

NO

PROJECT SCREENING PROCESS


PPTA Steering

Committee

Project Development




Recommendations



Oversight Board*

Agency

NO


Recommendations

NO

High-Level Screening Criteria • Ability to Transfer Risk • Funding Requirement • Ability to Raise Capital • Complexity of Effectively Leveraging

Private Sector Innovation/Expertise

• Consistent with Federal Requirements • Accelerated Project Development • Satisfies Public Transportation Need • Addresses Priorities in State, Regional

and/or Local Transportation Plan

• Project Efficiencies through PPTA Delivery


PPTA Steering

Committee

Project Development




Recommendations



Oversight Board*

Agency

NO


Recommendations

NO

Detail-Level Screening Criteria • Public Need and Benefits • Economic Development • Market Demand for PPTA Delivery • Stakeholder Support • Legislative Considerations • Technical Feasibility • Systematic Interface and Compatibility • Financial Feasibility • Legal/Legislative Feasibility • Project Risks • Life Cycle Management

CURRENT VAP3 PIPELINE

Status of VAP3 Pipeline

Projects in current VAP3 Pipeline 15

Projects have completed High-Level Screening 12

Projects have advanced to Detail-Level Screening 7

Projects Detail-Level Screening underway 4

Projects with completed Detail-Level Screening 3

Projects advanced as P3’s into Project Development 1

CURRENT PPTA PIPELINE

FUTURE OF VIRIGINIA P3 PROGRAM

• New 2014 PPTA Manual and Guidelines will continue to strengthen transparency, competition, public engagement, risk assessment and management

• P3 benefits -- equity, risk sharing, life-cycle costs, timely delivery

• Continue review of P3 process, decision-making, & accountability

http://www.transurban.com/files/Washington_DC_495_01.pdfhttp://www.transurban.com/files/Washington_DC_495_01.pdf

FUTURE OF VIRIGINIA P3 PROGRAM

VAP3 Pipeline will broaden in scope: • Real Estate transactions • Optimizing existing assets

Current VAP3 Pipeline contains procurement types:

• PPTA • PPEA • VPPA

VAP3 Pipeline is continuously updated and on Website

http://www.transurban.com/files/Washington_DC_495_01.pdfhttp://www.transurban.com/files/Washington_DC_495_01.pdf

P3 PROGRAM NEXT STEPS

• Finalized 2014 PPTA Implementation Manual and Guidelines

• Coordinated with transportation agencies adoption of the 2014 PPTA Manual

• Finalize Guidelines in early 2015: 1. Risk Management 2. Public Engagement 3. Value for Money Analysis

• Draft PPEA Manual in early 2015

P3 PUBLIC ENGAGEMENT

• VAP3 new website – live in early December and serves as basis for P3 program & project information

• Twitter - VAP3 live and serves as quick release of information

• Apps – under consideration to share and interact with consumers

P3 LESSONS LEARNED

• Permanent office acts as champion, catalyst, guide

• Consistent, detailed guidelines facilitate delivery, realization of public benefits

• Continuous reviews of assumptions and conclusions improve project decisions

• Effective communications focus on benefits produced, broad policy goals advanced

• Steady flows of information to agencies, officials, planners, media build understanding and trust

• Others have good ideas, too, and competition is growing

P3 SHARED CHALLENGES

• Public funds are shrinking • Traditional delivery methods are not filling the gap • Political focus too often is short-term and small, not strategic • Engagement allows us to see members of the public as customers

and consumers of services willing to pay for what they value • P3s remain unnecessarily complex, mystery to many • More standard approaches, terms are needed • New P3 approaches can help fill gaps beyond transportation

THANK YOU

Virginia P3 Update - 2015

www.p3virginia.org

Jackie Cromwell

Virginia Office of Public-Private Partnerships [email protected]

mailto:[email protected]

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