Alternative Transit Project Delivery Offers Attractive Options

Posted on March 18, 2013 by Alex Roman, Managing Editor

Page 1 of 3

Alternative project delivery, including public-private partnerships (PPPs); design-build; and design-build-operate-maintain, are viewed as attractive options for transit agencies, as they transfer risk and accelerate the project process.

However, while these forms of project delivery continue to take hold in Europe, Asia and Africa, there have been a limited amount of projects in the U.S. that have utilized these innovative solutions.

METRO Magazine spoke to representatives from several companies to discuss why forms of alternative project delivery have been slow to take off in the U.S., as well as the possible benefits and what transit agencies should look for before selecting a partner.     

How does alternative project delivery benefit a public transportation agency?

Mel Placilla (Director, professional services, transportation group, HDR): What we advise is that they have to have some drivers to want to do alternative delivery; one is time. You can go much faster [with alternative project delivery] because you lose multiple months, in some cases, between development of final plans and bidding and then getting construction started with traditional forms of delivery.
Additionally, for us and most organizations that deal with alternative delivery, the mantra is allocate the risk to the entity best able to manage the risk.

Samara Barend (VP/P3 development director, AECOM Capital): In a PPP, for example, you have an integrated form of project delivery, where there’s one single point of accountability, unlike a traditional delivery where the designer and contractor each report to the state or city agency they are working for. In a PPP, there is a full integration of design, construction, long-term operations and financing. That integration allows much more  risk transfer from the public sector to the private sector. And because you’re able to transfer that risk, you can generate considerably more cost savings, because much of the risk you’re transferring are risks that the private sector has much more ability to control than the public sector — overall project delivery, scheduling, budget.

Basically, in a PPP, the private sector is taking the risk that project will be delivered on time and on budget, otherwise they do not get paid.

Lorenzo Reffreger (head of sales, systems, North America, Bombardier Transportation): What a public transportation agency is acquiring, other than the services, is cost certainty, because there are different elements involved that allow the agency to know what the costs are. And, when the contractor is able to act as sort of one-stop shop, the integration of all those elements makes it easier for the agency to have cost certainty.

There’s also an amount of schedule certainty, because these are turnkey procurements where the agency is basically saying ‘give me everything and this is the date by which I need to open.’

Overall, alternative project delivery enables the public agency to focus on what they do, rather than maintaining equipment.

Stephanie Brun-Brunet (VP, turnkey & infrastructure systems, Alstom): [Alstom] approaches all of these [alternative project delivery] structures as turnkey projects, and while there are differences, they all offer agencies and cities the same fundamental benefit — the ability to move new transportation projects forward in a resource-constrained environment.

Giving private sector partners a stake in the project's success also reduces the level of public sector risk associated with things like managing project interfaces, integrating systems and technologies, minimizing delay and ensuring the system meets established performance requirements. Private sector involvement also helps ensure on-time delivery and that the project comes in on or under budget — Deloitte recently found that alternative project structures can be 20% less expensive than design-build projects.

View comments or post a comment on this story. (0 Comments)

More News

Stagecoach to deliver contactless bus travel across UK by end of 2018

The $15 million initiative will allow passengers to pay for their travel with a contactless credit or debit card, as well as Apple Pay and Android Pay.

Alexander Dennis' Enviro500 concept bus on display in Singapore

The full low-floor, three-door, two-staircase double-deck bus is being shown at the LTA-UITP Singapore International Transport Congress and Exhibition in Suntec City.

ETA adds Intelligent Transit System to Grand Valley

The new ITS provides Grand Valley with ETA's real-time arrival predictions, fare collection system integration, automatic on-board announcements, and the tools to track and chart system improvements over time.

Proterra names Honeywell, Tesla vet to COO post

Josh Ensign’s track record includes leading global operations for 42 factories in 15 countries and managing the supporting supply chains. 

Nova announces 2 major orders for San Antonio VIA, Houston Metro

The buses will be manufactured in Plattsburgh, state of New York, and the delivery of the vehicles has already begun in Houston.

See More News

Post a Comment

Post Comment

Comments (0)

More From The World's Largest Fleet Publisher

Automotive Fleet

The Car and truck fleet and leasing management magazine

Business Fleet

managing 10-50 company vehicles

Fleet Financials

Executive vehicle management

Government Fleet

managing public sector vehicles & equipment



Work Truck Magazine

The number 1 resource for vocational truck fleets

Schoolbus Fleet

Serving school transportation professionals in the U.S. and Canada

LCT Magazine

Global Resource For Limousine and Bus Transportation

Please sign in or register to .    Close