Alternative Transit Project Delivery Offers Attractive Options

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

Page 3 of 3

Experts say alternative project delivery enables public transit agencies to transfer risk to the private sector and focus on what they do best, moving and servicing people.
Experts say alternative project delivery enables public transit agencies to transfer risk to the private sector and focus on what they do best, moving and servicing people.
Do you want to include operations and maintenance, or do you just want to include major maintenance? That is a major factor to consider.

Reffreger: You need to look at a reliable, proven technology provider. There are a lot of people in our industry that do many things, but there are very few in the industry that can integrate all the different elements. You certainly have to go through a process to find people that are going to be able to integrate all these into one seamless delivered network.

Pierson: If I was sitting on an agency’s review board, [I would] obviously look for all the important things, such as the experience and qualifications of the firm or team that is put forward. I think, though, that what is going to deliver value and be viewed as delivering value more and more is the ability of a team to really deliver that value in a cross-disciplinary manner.

That is to say, the days of someone who is a design engineer and only a design engineer are moving behind us. Teams need to be able to bring expertise in planning, design and construction even if they are only doing the planning or the design. They need to have the full range of abilities because these projects, whether they are in traditional plan, design and build mode or they are in the design-build integrated mode, are requiring the full skillsets more and more because they are part of an integrated approach, even if there are separate companies doing the work.

So, what I would look for is the ability to integrate multidisciplinary skillsets in that team, so that you have the best solution.

Why do you think alternative project delivery has been slow to take hold in the U.S.?

Brun-Brunet: Transit agencies in the U.S. are accustomed to a traditional, well-established approach to transportation project financing, which relies very heavily on federal funding. That familiarity has, until very recently, given agencies little or no reason to consider alternative procurement schemes. The federal model is also very prescriptive in terms of technical specifications, which has left little room for the system design innovation inherent to a private partnership.

Now, with less certainty around the long-term flow of federal transportation funding, agencies are beginning to explore creative, outside-the-box ways to address their communities' evolving transportation needs. Hence, the renewed interest.

Pierson: One of the reasons why there’s been a little reluctance within transit agencies is because each [different form of alternative project delivery] involves some level or degree of loss of control, if you will, by the agency.

For example, if you go design-build, instead of detailing and controlling exactly how it’s designed, one has to put together performance specifications around how it would operate and then let the design-build contractor go about ensuring it is delivered within those specifications.

There is a range of possibilities within those specifications and the transit agency, in effect, loses control of where within that range the system falls, but that is what has to happen. There is a natural reluctance for that to happen, but that’s just human nature.

Finally, do you expect alternative project delivery to grow in the U.S.?

Barend: I think transit is a great market. There are a number of cities and states looking at innovative options for PPPs in transit. The opportunity for cost overruns and schedule delays has been significant on diverse projects we’ve seen in the U.S. that have been traditionally delivered, so I think PPPs present an interesting choice.

Pierson: Nothing succeeds in generating interest like success. So, if you take the [FasTraks] project in Denver, and that becomes a success in that it produces a system with a lower cost and a shorter schedule, other transit agencies are going to look at that and think that if [that agency] can achieve those benefits why can’t they?

In fact, they will look and say, ‘if they can achieve those benefits so can we.’ Therefore, transit agencies will have to look at [alternative project delivery], because everyone is constrained on funds, and if they can produce more with less, it’s incumbent upon them to do so. I haven’t met anybody in a transit agency who isn’t interested in producing the same quality of a project faster and cheaper.   

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