© 2014 HDR Architecture, Inc., all rights reserved. © 2014 HDR, Inc., all rights reserved. © 2014 HDR, all rights reserved.

North Dakota League of Cities Alternative Project Delivery September 17, 2016

 Design-Bid-Build (DBB)  Construction Manager / General Contractor (CMGC) (Similar to CM at Risk)  Design-Build (DB)  Design-Build-Operate-Maintain (DBOM)  Design-Finance-Build-Operate-Maintain (DFBOM)  Build-Operate-Transfer (BOT) Delivery Options: Public Works Projects

 Typically led by governmental bodies.  Public sector staff oversees project activities, including planning, engineering and construction. Activities proceed sequentially.  Project development generally contracted to planning and engineering consultants.  Engineering work (PS&E) is completed prior to soliciting construction bids.  Construction procurement follows typical low-bid procedures.  Generally financed by public taxes, fees or grants. Design-Bid-Build

Source: FHWA Every Day Counts Innovation Initiative Comparison of Delivery Methods: DBB

 Involves “alliancing,” a popular project delivery scheme in Australia, UK, etc.  Agency contracts with an engineering firm as designer of record.  Agency selects a construction manager/general contractor (CM/GC) for the project to provide design input and act as owner’s representative.  Agency retains designer and CM/GC, and facilitates a “marriage” for project development.  CM/GC and Agency negotiate guaranteed construction price (GMP) as design is finalized.  CM/GC completes construction Construction Manager / General Contractor

Source: FHWA Every Day Counts Innovation Initiative Comparison of Delivery Methods: CMGC

 Planning and conceptual engineering (15%- 35%) completed by agency/consultants.  Final design and construction carried out by single contractor, with single contract.  Engineering and construction activities proceed in parallel, rather than sequentially.  DB bidding may be “low-bid” or “best- value.”  Transfers interface risk between design and construction from owner/agency to DB contractor. Design-Build

Source: FHWA Every Day Counts Innovation Initiative Comparison of Delivery Methods: DB

 Similar to DB, but contractor is also responsible for operating/maintaining system for specified period in addition to design and construction.  Contractor may hold responsibility for procuring and commissioning rolling stock.  Provides “implied warranty” between system constructor and system operator.  Transfers interface risk between design/ construction and operations/maintenance from agency to contractor. Design-Build-Operate- Maintain

Comparison of Delivery Methods: DBOM

 Similar to DBOM, but contractor arranges and/or provides financing for construction through private capital markets.  Contractor typically repaid through “availability payments” or similar mechanism, guaranteed by owner/agency.  Transfers financing risk from agency to contractor, in addition to design, construction and operation risk. Design-Finance-Build- Operate-Maintain

Comparison of Delivery Methods: DBFOM

 Closest method to complete privatization.  Agency selects contractor (“concessionaire”)  Responsibility for designing, financing, constructing, operating/maintaining system is transferred from agency to concessionaire.  Concessionaire may accept revenue risk in addition to DBOM risks.  Transfers virtually all risks from owner/agency to private sector.  Common delivery method in Europe, Asia, Australia and South America. Build-Operate-Transfer

Comparison of Delivery Methods: BOT

Relationship Between Private Sector Involvement and Risk

Source: Duke Center on Globalization, Governance & Competitiveness, US Bus Rapid Transit Research, July 2012 Comparison of Delivery Methods

South Mountain Freeway Project  Programmed $1.77 billion  Publicly financed  40% federal funding, 60% regional funding  State administered – federally assisted  Design-Build-Maintain o 18-month procurement o 3.5-year construction duration o 30-year maintenance duration Arizona DOT P3 Program Management

South Mountain Freeway Project Adot P3 Program Management

Cost and Schedule Certainty  Open to traffic 3 years faster  $200 million to $300 million under budget  Largest known piece of Regional Transportation Plan Freeway Program  Maricopa Association of Governments (local MPO) able to confidently rebalance program Maintenance  30-year maintenance program makes life-cycle performance a major focus during design and construction  Hand-back provisions provide insurance ADOT will receive a high-quality facility in 30 years P3 Delivery Method Benefits

Sioux Falls, SD I-229 Design-Build Project Limits Complete reconstruction of mainline Added auxilarry lanes between interchanges Project cost: $33 million

Cost and Schedule Certainty  South Dakota had/has enabling legislation in place  Project completed in 24 Months (Contractor award to completion) o Scheduled allowed for 30 months  Typical SDDOT schedule = 8 years for Design/Bid/Build  Used to deliver overall program for interstate system around Sioux Falls o I-29 scheduled for major reconstruction from I- 90 south to 26 th Street (5.5 Miles) o Needed truck detour  Strict Quality Control on design and construction.  3 Teams bid (1 disqualified at time of package review) Design-Build Method Benefits

© 2014 HDR Architecture, Inc., all rights reserved. © 2014 HDR, Inc., all rights reserved. © 2014 HDR, all rights reserved.