Honolulu Authority for Rapid Transportation’s P3 Owner’s Forum Regional Transportation District Eagle P3 Project Denver, CO
About RTD • Service area: 2,342 square miles • Population served: 3.03 million • RTD staff 2,863 + 1,608 private contractor staff • Buses, Call-n-Ride and ADA vehicles: 1,433 • Light rail vehicles: 172 • Commuter rail Vehicles: 66 • 2017 statistics: − Total ridership: 99 million − Assets: $6.8 billion − Revenue: $990 million − Operating exp.: $581.9million − Capital outlay: $451 million 2
Eagle P3 Project • University of Colorado A Line • 22.8 miles of commuter rail between Denver Union Station and DIA • B Line • 6 miles of commuter rail between Denver Union Station and Westminster • G Line • 11.2 miles of commuter rail between Denver Union Station and Wheat Ridge
Eagle P3 - History • In 2003, RTD and CDOT initiated an Environmental Impact Statement (EIS) for the I 70 Corridor • In 2006, RTD initiated an EIS for the Gold Line Corridor • In August 2007, approved by FTA to participate in the Penta-P program • Provided for accelerated review process • Reduced oversight during project development • In September 2009, issued final RFP to pre-qualified teams. • In July 2010, entered into a Concession Agreement with Denver Transit Partners (DTP) 4
Eagle P3 Project Scope • Overall capital cost $2.2 billion • 36 miles of new electrified (25kV) commuter rail • 37 major bridge structures • 14 new stations plus Denver Union Station hub • Commuter Rail Maintenance Facility • 66 cars in married pair configuration (including 12 for N Metro) • 29 at-grade crossings shared with Class 1 Railroads
Eagle P3 - Terms • Concession Agreement – DBFOM • Design • Build • Finance • Operate • Maintain • 34 Year Agreement (2011-2044) • Includes 5 year design/ build • 29 year maintain and operate • RTD sets and retains fares • RTD owns assets • RTD pays traction power and security costs 6
Eagle P3 - Funding & Financing Sour ces Total Asset Cost - $2.3 billion • $1.1 billion in federal funds • $1.03 billion New Starts grant • $65 million CMAQ funding • $450 million in private financing • $396 million in private activity bonds • $54 million private equity • $460 million in local funds • Includes sales tax revenue bonds, sales and use tax revenues, and contributions from local jurisdictions • $280 million Transportation Infrastructure Finance Innovation Act (TIFIA) loan 7
Eagle P3 - Repayment • Construction Phase • Set amounts tied to earned value • Maintain and Operate Phase • Service Payments • Funds maintenance and operations • Concessionaire receives 100% of availability payment for meeting 95% of performance standards • Bonus of up to 0.5% for perfect delivery • Deduction of up to 25% for inferior delivery
Eagle P3 – Service Payments Although there are many factors that go into the service payment calculation. There are three factors that influence whether there is a bonus or deduction. • Rolling Stock Availability • On Time Performance • Station Availability
Monthly Payments – Calculation • TABOR payment (debt & equity) • Indexed Service Availability payment: Start with: Base Service Availability Payment Adjusted by: Availability Factor ¹ Equals: Availability Adjusted Base Service Payment Less: Performance Deduction Plus: Special Events Amount Due Equals: ¹Availability Factor corresponds to the Availability Ratio². Once the Availability Ratio is calculated, the Availability Factor is found in the Availability Factor Tables in the Concession Agreement (3 x Rolling Stock Availability) + (2 x On-Time Availability) + (1 x Station Availability) ²Availability Ratio = 6 10
Eagle P3 - Risk Sharing RTD Concessionaire • ROW Acquisition • Cost Overruns • Railroad Force Account Work • FRA Approvals • 3 rd Party Claims • Unidentified Environmental Conditions • Failure to meet Performance • Unidentified Utilities Standards • Ridership • Operation and Maintenance Costs • Condition of System at end of Concession Period 11
Lessons Learned • Procurement • Maintain a competitive field • Provide stipend • Listen to concerns over risk allocation • Allow for innovations • Performance Specifications • Alternative Technical Concepts • Ensure confidential communication between bidders and owner • Follow procurement schedule • Keep Board of Directors informed • Public outreach • Impact of local taxes on pricing
Lesson Learned • Service • Joint understanding of metrics and calculations • Data capture and reporting • P3 Delivery • Jurisdictions do not understand the constraints of a P3 • Lock down scope and involvement early • Lenders do not like changes • Even simple design changes are perceived as increasing risk to a Concessionaire • Complexities of dealing with multiple jurisdictions, railroads, airports, FTA, FRA, regulatory bodies, etc.
Lesson Learned • P3 Funding and Financing • Make sure you get what is eligible for federal funds in writing • Make sure owner finance and accounting staff are at the table during negotiations • Ensure private concessionaire understands documentation needed • Keep external auditors updated and involved
Eagle P3 – Completion Dates • University of Colorado A Line • Opened April 22, 2016 • B Line • Opened July 25, 2016 • G Line • Scheduled to be open Fall 2016 – Still TBD 15
Questions? 16
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