Alternative Project Delivery: Lessons Learned and Yet to be Learned Shivaji Deshmukh, executive Manager (Engr & Ops), West Basin MWD Tim Busch, GM, Woodland Davis CWA Neil Callahan, Director, Louis Berger US Bob Siemak, Moderator, AGM, United Water CD

What is Alternative Project Delivery and Why Use it? Delivering a project other than by the traditional project delivery method (i.e. design-bid-build) ISSUE TRADITIONAL ALTERNATIVE Control/Risk Sharing Owner DB/O/F entity Time Slower (Series) Faster (Parallel) Cost Price (Low Bid) Best Value Complexity Std Approach Innovation

APD is all about control of various phase of a project: life cycle approach Plan Finance Design Build Operate

Owner does it all Rare; Limited to large agencies MWD of SC LADWP Plan Finance Design Build Operate OWNER Rare; Limited to large agencies MWD of SC LADWP Projects are usually repair and replacement Pipelines are most common facilities

Traditional Delivery (DBB) Plan Finance Design Build Operate OWNER Design Build PARTNER Owner has control but also most of the risk Low Bidder

DBB structure Design/Builder finger pointing More detailed design Owner Designer Builder Design/Builder finger pointing More detailed design Longer time (series activities) Cost established late

DBB variation – Construction Management at Risk (CMAR) Owner Designer Builder ( or CMAR) Quals-based Selection More collaboration Cost (GMP)at 60%

West Basin MWD Design Build (DB) Plan Finance Design Build Operate OWNER West Basin MWD Design-Build Entity PARTNER

BD Structure Who leads team Contractor Integrated Firm JV Owner Who leads team Contractor Integrated Firm JV Performance vs. Prescriptive Lump Sum or Progressive DB Entity Designer Builder

Design Build Operate (DBO) Plan Finance Design Build Operate OWNER Woodland Davis CWA Design-Build-Operate Entity PARTNER

DBO Structure Term is key 5 to 15 years Operator is guarantor Limited No. of Ops firms Owner DBO Entity Designer Builder Operator

DBO Structure Term is usually short (1-3 yrs) Start-up, commissioning and validation More competitive landscape Like DB Owner DBO Entity Designer Builder Operator

Design Build Finance Operate (DBFO) Plan Finance Design Build Operate OWNER Carlsbad Ocean Desalination DBFO Entity PARTNER

DBOF Structure DBFO Entity is financially sophisticated Debt vs Equity Investment Grade Debt Owner DBFO Entity Financing Partner Designer Builder Operator