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 2 nd 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
PARTNERSHIPS CREATE HUGE PUBLIC BENEFITS P3 Project Project Cost State % of Jobs Economic Activity Contribution Total Supported Cost 495 Express $ 1.9 B $ 409 M 22 % 31,000 $ 3.5 B Lanes 95 Express $ 925 M $ 71 M 7.6 % 8,000 $ 2 B Lanes 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 Briefing Focus: ‒ Public ‒ Detail - Level Screening Report ‒ Desirability as P3 ‒ Feasibility as P3 ‒ HB 2 Prioritization ‒ Duration of P3 development and procurement Briefing Focus: ‒ RFI results (as appropriate) ‒ Schedule ‒ Refresh on the high points from Project Draft and Final Development Contract Documents ‒ Preliminary Procurement documents posted on P3 ‒ Risk Analysis and Value -for-Money Website for review & ‒ Estimated project cost Briefing Focus: comment ‒ Potential public subsidy ‒ Major Business Points ‒ Potential economic benefits ‒ Updated Risk Allocation & Management ‒ Preliminary Business Points Plan ‒ Initial Finding of Public Interest ‒ Statutory Audit results ‒ Final Value -for-Money Analysis ‒ Updated economic benefits ‒ Project bid results Final Contract ‒ Public subsidy (if required) Documents posted ‒ Final Finding of Public Interest 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
PROJECT SCREENING PROCESS Solicited P3 Projects Unsolicited P3 Projects High-Level Policy Review with Screening with Recommendations Recommendations Agency Detail-Level Screening with Recommendations NO NO PPTA Steering Returned to Committee Agency or Proposer Oversight Board* Project Development
PROJECT SCREENING PROCESS Solicited P3 Projects Unsolicited P3 Projects High-Level Screening Criteria High-Level Policy Review with Ability to Transfer Risk Screening with • Recommendations Recommendations Funding Requirement • Agency Ability to Raise Capital • Detail-Level Complexity of Effectively Leveraging • Screening with Recommendations Private Sector Innovation/Expertise NO NO Consistent with Federal Requirements • PPTA Steering Returned to Accelerated Project Development Committee • Agency or Proposer Satisfies Public Transportation Need • Oversight Addresses Priorities in State, Regional Board* • and/or Local Transportation Plan Project Project Efficiencies through PPTA Delivery Development •
PROJECT SCREENING PROCESS Solicited P3 Projects Unsolicited P3 Projects Detail-Level Screening Criteria High-Level Policy Review with Public Need and Benefits Screening with • Recommendations Recommendations Economic Development • Agency Market Demand for PPTA Delivery • Detail-Level Stakeholder Support • Screening with Recommendations Legislative Considerations NO NO • Technical Feasibility PPTA • Steering Returned to Committee Systematic Interface and Compatibility Agency or • Proposer Financial Feasibility • Oversight Board* Legal/Legislative Feasibility • Project Risks • Project Development Life Cycle Management •
CURRENT VAP3 PIPELINE Status of VAP3 Pipeline Projects in current VAP3 Pipeline 15 Projects have completed High-Level 12 Screening Projects have advanced to Detail-Level 7 Screening Projects Detail-Level Screening underway 4 Projects with completed Detail-Level 3 Screening Projects advanced as P3’s into Project 1 Development
CURRENT PPTA PIPELINE
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
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
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 Jackie.Cromwell@P3.Virginia.gov
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