1. Intermodal PPPs and Availability Payments Focus Georgia 27 April 2007

2. © 2007 Jeffrey A. Parker & Associates, Inc. -2- Intermodal and Public Transit Projects Often Differ From Toll Roads Service quality and usage maximization can be more important or applicable goals than revenue maximization Public may intend to retain direct rate setting authority Leveraging direct revenues may not be a feasible approach for project financing –Project may not generate direct revenue –Revenue potential may be limited –Revenue or traffic volume could be difficult to predict or manage … but this does not mean that a PPP approach is inappropriate for intermodal projects

3. © 2007 Jeffrey A. Parker & Associates, Inc. -3- Examples of “True” PPPs Underway for U.S. Intermodal and Transit Projects Port of Miami Tunnel BART Oakland Airport Connector Miami Streetcar Denver RTD? (PPP = Design-Build-Finance-Operate-Maintain)

4. © 2007 Jeffrey A. Parker & Associates, Inc. -4- Port of Miami Tunnel – Cost Capped for 35 Years MacArthur Cswy Widening Bored Tunnel Watson Island Port of Miami Bored Tunnel Under Main Channel Bored Tunnel Under Main Channel Bridge Widening Bridge Widening Roadway Improvements Roadway Improvements

5. © 2007 Jeffrey A. Parker & Associates, Inc. -5- Potential Intermodal Project Issues – PPP Option Belongs in the Toolkit Desire to deliver projects on accelerated basis Difficult to issue debt and/or non-recourse debt Need for long-term guaranteed cost structure –Cap construction and O&M costs (and achieve lifecycle efficiency) –Enable long-term budget planning –Multiple funding partners Need for schedule adherence, phasing synchronization, etc. Requirements for high level of availability and/or service quality Unique projects – different from core systems and/or facilities

6. © 2007 Jeffrey A. Parker & Associates, Inc. -6- Understanding Risk Transfer and Project Delivery Choices Concessionaire Lenders OperatorEPC Contractor Government Equity Investors DBFOM Government Muni Debt Operator or GovernmentEPC Contractor Design-Build © 2007 Jeffrey A. Parker & Associates, Inc.

7. -7- Anticipated Public Expenditures for Traditional Design-Build © 2007 Jeffrey A. Parker & Associates, Inc. 35

8. © 2007 Jeffrey A. Parker & Associates, Inc. -8- With Overruns? 35 © 2007 Jeffrey A. Parker & Associates, Inc.

9. -9- Availability Payments Include both CAPEX and OPEX Cannot be earned until facility opens! Must be earned with high service levels (are not debt) Capped for contract life based on bid 35 © 2007 Jeffrey A. Parker & Associates, Inc.

10. -10- Inherent Risk Transfer and Alignment of Interests Concessionaire Lenders OperatorEPC Contractor Government Equity Investors Availability-Based DBFOM Availability Payments Must be earned Capped at amount bid Not debt

11. For additional information contact: Michael Parker, Managing Director 1308 Spruce Street Philadelphia, PA 19107 mp@japarker.com 215.790.8404