23 YORK REGION TRANSIT (YRT/VIVA) AUTOMATED FARE COLLECTION EQUIPMENT MAINTENANCE CONTRACT EXTENSION
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1 Clause No. 23 of the Committee of the Whole meeting was adopted, without amendment, by the Council of The Regional Municipality of York at its meeting on September 26, YORK REGION TRANSIT (YRT/VIVA) AUTOMATED FARE COLLECTION EQUIPMENT MAINTENANCE CONTRACT EXTENSION 1. RECOMMENDATIONS It is recommended that: 1. Council authorize the extension of the current contract with Cubic Transportation Systems for York Region Transit (YRT/Viva) automated fare collection equipment maintenance at a total cost not to exceed $8,168,987.00, excluding taxes. 2. Council authorize the term of the contract be for a period of five years, commencing on December 1, Council authorize the Commissioner of Transportation and Community Planning to approve any revisions to the contract due to changes in scope resulting from the elimination of paper fare media during the term of the contract. 4. Council authorize the Commissioner of Transportation and Community Planning to execute the contract, subject to the approval of Legal Services as to form and content. 2. PURPOSE This report seeks Council authorization for a five-year extension of the current contract with Cubic Transportation Systems (Cubic) for YRT/Viva s automated fare collection equipment maintenance, commencing on December 1, The contract is required to perform preventive and emergency maintenance services on all Viva fare collection equipment, old and new installed at vivanext stations. The maintenance contract will also be used for preventive and emergency maintenance services on the PRESTO smart card system. Cubic was the original supplier of the Viva fare equipment. Certain components of original and new vivanext fare equipment have been custom built. Cubic has also incorporated proprietary technology into their equipment. As such they are the most suited to perform preventive and emergency maintenance services. Cubic has been providing satisfactory maintenance services since the Viva Quick start launch in 2005.
2 Clause No BACKGROUND The Viva off-board fare collection system is based on proof-of-payment (POP). The system requires customers to retain proof that the correct fare has been properly paid. Customers can accomplish this by either purchasing a single journey validated ticket at a ticket vending machine (oneride) installed at each Viva station, or by validating a ticket at a ticket validator (vivanow) previously purchased at a terminal ticket vending machine (multiride) or merchant before boarding. These fare collection devices are complex electro-mechanical machines that require specialized regular preventive maintenance and periodic emergency maintenance service. York Region Transit s ability to collect fares from Viva passengers depends on this equipment working properly and repaired expeditiously should a problem occur. Council authorized an extension of the original maintenance contract in September 2010 The Viva off-board fare collection system was provided by Cubic in 2005 as part of the original supply contract with Kiewit EllisDon, the design-build contractor. On September 23, 2010, Council authorized an extension of the original YRT/Viva automated fare collection equipment maintenance contract with Cubic as Cubic had been providing satisfactory maintenance services since the Viva Quick start launch in That contract expires on November 30, Cubic is also the supplier for the new ticket vending machines being installed for the vivanext rapidways The new ticket vending machines have been supplied by Cubic under subcontract with Kiewit-Ellis Don to the York Region Rapid Transit Corporation under the Design-Build Agreement. That agreement includes a two year parts and labour warranty. As the original supplier having warranty liability and to ensure fast, efficient response should a problem occur, it is preferable to have them continue with the maintenance and support. 4. ANALYSIS AND OPTIONS Cubic has provided a quote for preventive maintenance services and a labour rate for emergency services of the fare collection equipment, which is summarized in the following sections.
3 Clause No Proposed preventive and emergency maintenance service rates are lower than those currently in place due to a longer term (5 year) contract extension Cubic s proposed annual increase for the preventive and emergency maintenance rates is 2.5% for the term of the contract. The quoted rates are lower than those from the extension approved in year Previous annual percentage increase was three per cent for a three year contract, YRT/Viva staff have been successful in negotiating a better rate due to a longer term contract and potential future work due to the expansion of vivanext network. A five year extension will allow YRT/Viva staff to maintain consistency in installation, preventive and emergency maintenance on other new machines which will be installed in future vivanext phases. It will also promise Cubic a longer term commitment and the possibility of them maintaining a local presence in Greater Toronto Area (GTA). Survey of peer local agencies found that costs for comparable equipment service needs were slightly higher than those quoted by Cubic to YRT/Viva For example the unit rate for new PRESTO (Metrolinx) equipment installation increases three per cent each year. GO Transit (Metrolinx) is in the process of winding down their contract with Cubic. Their hourly rate for maintenance during regular business hours and evenings and weekends is higher than the quoted rate for YRT/Viva. Cubic is requesting a review and negotiation of unit rates when ticket validators are removed towards the end of 2016 or early 2017 when TTC implements PRESTO on their buses and paper fare media are eliminated For the next few years YRT/Viva paper tickets and monthly passes will continue to be needed due to limited TTC implementation of PRESTO. Customers transferring to/from YRT/Viva and TTC buses will have to use the current YRT/Viva fare media including the Greater Toronto Area (GTA) weekly pass. TTC has signed an agreement with Metrolinx to implement PRESTO on their system. Implementation of PRESTO smart card system on TTC buses operating north of Steeles will allow YRT/Viva staff to eliminate paper fare media and remove existing ticket validators. Cubic would negotiate the unit rates for the preventive and emergency maintenance as it will significantly reduce their fixed revenue due to the reduction in the maintenance work. Metrolinx is also working on a solution for fare payment using PRESTO for Mobility Plus customers. Mobility Plus customers will continue to use paper tickets until the PRESTO solution is implemented.
4 Clause No Cubic will provide preventive, on-going and emergency maintenance for the PRESTO smart card system The PRESTO smart card was implemented in July The PRESTO equipment installed at Viva stations and terminals requires preventive and emergency maintenance work including responding to equipment failures and vandalism. Cubic will provide these services at the unit rates included in their quote. Emergency maintenance services for the various new technologies installed at vivanext stations will be provided by Cubic The following additional technologies are being installed at vivanext stations, scheduled to open in August 2013: Closed Circuit Television (CCTV) cameras for the security of customers and assets installed at stations Public Address (PA) system to allow remote and local announcements to be made in the case of an emergency, service delay or disruption Emergency Call Box (ECB) allowing customers to contact transit control centre and seek help in the case of an emergency Digital clock displaying the current time These technologies have been supplied by Kiewit-Ellis Don to the York Region Rapid Transit Corporation under the Design-Build Agreement. All of the new equipment includes a limited parts and labour warranty. Kiewit-Ellis Don is not equipped to provide 24/7 repair and maintenance services on short notice. Considering the urgency to maintain quality customer service and support on-going operations, YRT/Viva staff will arrange for equipment repairs through existing contractors and charge back appropriate parts and labour costs to Kiewit-Ellis Don. Cubic has agreed to provide emergency maintenance work on the new equipment as their staff are available to work on an as-needed basis and may be available in the near vicinity when the issues arises. There are numerous advantages to dealing with one maintenance contractor who will then be responsible for all technology equipment installed at Viva stations and terminals. Cubic will supply consumables and spare parts required to repair defective equipment Cubic s overall quoted rate for consumables and spare parts is comparable to the current contract. The current rates were finalized in 2010 and have not changed significantly since then. The current quoted rates will not change until 2018 if the five year contract extension is approved.
5 Clause No Based on the quoted rates and the actual consumables and spare parts ordered in the previous years, the budgetary amount for years are shown in Table 1. Storage of spare parts and consumables will be managed by Cubic Cubic is proposing to charge a rate of $ per year for the administration and management of spare parts inventory on behalf of York Region Transit (YRT/Viva). This is comparable to the $40,000 per year paid during the current contract. The quoted rate of $ per year will not change until Contract for the preventive and emergency maintenance services for the Viva Fare Collection System with the original manufacturer is justified The fare collection component of any transit system is one of the most critical system components. Any failure of the fare collection system may lead to a loss in revenue. Ideally, these services should be provided by the most capable vendor, Cubic, the original manufacturer of the equipment. Since Cubic has been providing these services satisfactorily, it is recommended that the existing contract be extended for another five years at the newly-quoted labour and material rates. Further justification for the contract extension is outlined below. Specialized Skills Because the maintenance of this sophisticated machinery requires specialized training and equipment, any service contractor that works on these devices must be suitably trained and equipped. It is expected that the manufacturer has incorporated proprietary technology into their equipment. Single Point of Responsibility By having the original manufacturer perform planned and emergency maintenance services for the fare collection devices, there will be a single point of responsibility. Cubic already has a maintenance service facility in the GTA to provide maintenance services. Emergency Maintenance Emergency maintenance service of sophisticated electro-mechanical machinery involves a significant level of troubleshooting and technical diagnosis to be able to return the machinery to revenue service as expeditiously as possible. The original manufacturer will be able to troubleshoot and diagnose more rapidly than another outside vendor.
6 Clause No Update to Software Part of a planned maintenance program will be providing updates and latest revisions for the Revenue Management Software, which could only be provided by the original manufacturer. Risk The disadvantage of awarding this work to Cubic is the lost opportunity for competitive bids on this work. However, the risk, uncertainty and cost stemming from the critical nature of the fare collection system, failure of which may lead to the loss of revenue, outweighs any marginal cost differential which may exist. YRT/Viva Focus Capabilities While YRT/Viva has some technical knowledge to undertake technical maintenance services, it does not have enough resources to undertake the maintenance during bus service hours. Shop Maintenance Services Repair of damaged parts or replacement of defective parts at the manufacturer s repair facility, which involves the use of specialized tools and employment of specialized skills, will be supplied under this contract. Link to key Council approved plans Vision 2051 includes a goal statement relating to the development of infrastructure for a growing Region, which states that: A seamless network for mobility provides accessibility to all destinations using diverse transportation options for people in all communities promotes active healthy living and safely and efficiently moves people and goods. The Viva fare collection system supports this goal by improving the speed and reliability of the transit system through the use of intelligent transportation systems. Reliable automated fare collection equipment will also protect the revenue collected through transit fares.
7 Clause No FINANCIAL IMPLICATIONS Table 1 provides a summary of the estimated costs for the preventive and emergency maintenance, consumables, spare parts and repair costs for each year of the proposed contract. Table 1 Total Contract Costs Description Current Extension Year 1 Viva Preventive and $529,471 $638,838 1 Emergency Maintenance Extension Year 2 $847,040 1 Extension Year 3 $938,223 1 Extension Year 4 $1,057,308 1 Extension Year 5 $1,138,863 1 PRESTO Preventive and Emergency Maintenance 26,688 27, , , , ,026 1 vivanext Emergency Maintenance 57,000 60,000 64,000 68,000 72,000 Consumables, Spare Parts and Repair Cost 330, , , , , ,286 Inventory, Storage and Management 40,000 Removal of Ticket Validators (vivanow) $40,000 Total Cost $924,363 $1,177,657 $1,516,927 $1,693,640 $1,836,588 $1,944,175 Grand Total Cost $8,168,987 1 Additional PRESTO and Viva fare equipment will be added due to vivanext rapidways. Sufficient operating funding will be included in the Business Plans and Budgets to cover the respective costs.
8 Clause No LOCAL MUNICIPAL IMPACT There is no municipal impact associated with this report. It is anticipated that the high quality of transit services will be maintained as a result of providing reliable automated fare collection equipment to our customers. Reliable automated fare collection equipment will also protect the revenue collected through transit fares. 7. CONCLUSION It is recommended that the current contract with Cubic Transportation Systems, the original manufacturer, be extended, for preventive and emergency maintenance, consumables, spare parts and repair costs for the Viva fare collection equipment and PRESTO equipment for a period of five years, commencing on December 1, 2013, at a total cost of $8,168,987.00, excluding taxes. For more information on this report, please contact Rajeev Roy, Manager, Transit Management Systems, at Ext The Senior Management Group has reviewed this report.
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