PACKAGING P3 PROCUREMENTS FOR COMPLEX PROJECTS THE LAX EXPERIENCE

Transcription

1 PACKAGING P3 PROCUREMENTS FOR COMPLEX PROJECTS THE LAX EXPERIENCE BRIAN C. OSTLER Deputy City Attorney City of Los Angeles ROGER JOHNSON Airport Program Executive Jacobs BRANDON J. DAVIS Partner Nossaman LLP SANJEEV SHAH Chief Strategy Officer Lea+Elliott, Inc. May 23, 2018

2 Presentation Overview Landside Access Modernization Program (LAMP) Overview Delivery Model Selection Availability Payment DBFOM Defined Legal Authority Innovative Procurement Tools Funding Issues RFQ / RFP Development Evaluation Process / Closing 2

3 LAMP Overview Why is it so hard to get in or out of LAX? Currently, everyone shares the same roadway and curb system in the Central Terminal Area. That roadway system is approaching saturation during peak periods, creating a poor level of service and causing spillover traffic congestion on local roads and freeways. LAWA must create a new way to get passengers to their terminals that can be accessed by all modes! 3

4 LAMP Overview The Rental Car Experience at LAX Rental Car businesses are currently scattered all over LAX area. Rental Car customers must take shuttles from the CTA to their provider. Shuttles are a major source of congestion in the CTA and on area streets. Passengers get easily lost trying to return their rental vehicles. 4

5 LAMP Overview Transforming LAX 5

6 LAMP Overview Six Major Program Elements 6

7 LAMP Overview APM System Overview Guideway 2-¼ miles long feet above ground feet wide Columns every 100 feet (typical) Stations/Trains/Cars Six APM stations 4-car trains up to 175 feet long Approximately 50 passengers per car, with bags System Operations/ Pedestrian Access Up to 9 trains in simultaneous operation 2 minute wait time Walkways to terminals, parking garages Moving walkways 7

8 Delivery Model Selection Comparative analysis of various models (Delivery options analysis) Qualitative and quantitative analysis Establish goals / determined delivery model s ability to meet goals Develop inputs (capex, opex, funding, discount rate, etc.) Initial risk identification / assessment Assess basic business / operational case for transaction Pros / Cons analysis Process requires coordination among public owner leadership and legal, financial and technical teams 8

9 Delivery Model Selection Delivery models considered for various program elements (or combinations of elements) Design-Bid-Build (DBB) Progressive Design-Build Lump Sum Design-Build Construction Manager-At-Risk Design-Build-Operate-Maintain (DBOM) Availability Payment Design-Build-Finance-Operate-Maintain Revenue Risk Design-Build-Finance-Operate-Maintain Pre-Development Agreement Process resulted in LAWA choosing: Availability Payment DBFOM for APM and ConRAC Progressive Design-Build for several other elements 9

10 Availability Payment DBFOM Defined Users Revenues (if any) Milestone or Final Acceptance Payments Public Owner Availability Payments Must be earned Capped at amount bid (adjusted for inflation) Equity Investors Developer Lenders D-B Contractor Operator Engineers/Architects Subcontractors/Suppliers 10

11 Availability Payment DBFOM Defined Public Owner Performs conceptual / preliminary design Obtains environmental approval May provide some (not all) capital funding (e.g., milestone payments) Oversees design, construction, operations and maintenance Makes Availability Payments, starting at substantial completion through end of contract term (e.g., 35 years) Developer Subject to reduction based on project availability / performance Designs and builds project / supplies vehicles (as applicable) Operates and maintains project for contract term Finances the project Guarantees price / completion 11

12 Legal Authority Determine whether agency has needed legal authority for DBFOM, which includes: Authority to award contract based on best value determination Authority to enter into single contract for design, construction, financing, operations and maintenance Authority to commit to making Availability Payments Payments through end of contract term (30 years) Appropriations risk Identify any needed legislative action Often, existing law may suffice even if not originally drafted for Availability Payment DBFOM 12

13 Legal Authority LAMP legal authority process Adopted ordinance to use competitive sealed proposal process (authorizes best value selection) Follow-up ordinance addressed issues related: Subcontractor listing law issues Proposal security Payment / performance security issues Licensing requirements Late payment rate 13

14 Vehicle Eligibility Determination Process Process Goals: Mitigate against risky APM Operating System technology being self-selected into Proposer teams Maximize competition for the APM DBFOM procurement Eligibility determination as a minimal threshold requirement to encourage more APM O/S suppliers to participate increasing the total number of potential integrated Proposer teams LAWA did not guarantee performance of O/S supplier or technology remains responsibility of Developer Technical merit evaluations occur as part of the formal integrated RFP process 14

15 Vehicle Eligibility Determination Process (cont.) APM O/S Supplier Eligibility Determination Roadmap Initiated before release of official RFQ for DBFOM Agr. Open Window for submittals Additional submittals / communication permitted to support determination Supplier submittals evaluated against Eligibility Checklist Administrative Licenses, ability to obtain bonds, insurance, etc. Technical Requirements focused on: Technical Maturity of Supplier s APM Operating System technology Supplier s ability to adapt, integrate and deliver the APM O/S technology to meet the performance functionality within project constraints/requirements (capacity, headways, trip times, reliability, life-cycle asset optimization, etc.) 4 Suppliers deemed Eligible Rolling notification of finding of Eligibility Bombardier, MHIA, Siemens and Ansaldo (with Woojin) Shortlisted Proposers and Eligible Suppliers self-select to form integrated teams 15

16 Vehicle Eligibility Determination Process (cont.) APM Operating System Technical Maturity 16

17 RFQ / RFP Development Procurement (RFQ, ITP) and commercial terms Usually drafted by legal counsel (at least initial draft) Needs coordination with staff, financial team and technical team Influenced by risk workshop(s) Technical specifications Drafted by technical team Significant legal review / coordination with commercial terms Cross-over provisions Drafted in coordination by legal, financial and technical teams Examples include: Payment mechanism / Availability Payment deduction regime Termination compensation Handback requirements 17

18 Innovative Procurement Tools LAWA using various innovative procurement tools for APM procurement Two-step procurement (RFQ followed by RFP) Q&A on draft RFP documents One-on-one meetings Alternative technical concepts Aesthetic review process Best value selection Payments for work product (stipends) 18

19 Funding Issues Use of single DBFOM contract raises questions of whether / how to use various funding sources Customer Facility Charges (CFCs) Passenger Facility Charges (PFCs) Federal funding sources Airport revenues To ensure compliance, need to: Identify any limitations on funding sources (e.g., cannot use CFCs to operate and maintain rental car facilities) Set up process to properly document / track usage of funds as part of unitary Availability Payment 19

20 Evaluation Process / Closing Multi-Phased Evaluation Process Technical Proposal Review Expert Panel Develops consensus comments Scoring Panel Recommends scores Financial Proposal Review Bids results in price score using formula in the RFP CFO / financial advisors review Financial Proposal Weighting: 60% technical; 40% financial Executive Review Panel Reviews results of technical / financial evaluations Presents selection recommendation to CEO Process resulted in selection of proposer with both the highest technical score and lowest price Commercial Close / Financial Close 20

21 QUESTIONS 21

22 CONTACT Brian C. Ostler City of Los Angeles Brandon J. Davis Nossaman LLP Roger Johnson Jacobs Sanjeev Shah Lea+Elliott, Inc. 22

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