Purple Line Extension contract staff report

Los Angeles CountyMetropolitan Transportation Authority

Metro

One Gateway Plaza ai3.922.zooLos Angeles, CA gooiz-z95z metro net _

CONSTRUCTION COMMITTEEJULY 17, 2014

REVISED

SUBJECT: WESTSIDE PURPLE LINE EXTENSION PROJECT, SECTION 1

ACTION: AWARD DESIGN BUILD CONTRACT AND ESTABLISH LIFE OFPROJECT BUDGET

RECOMMENDATION

A. Authorize the Chief Executive Officer (CEO) to award a 107 month firm fixedprice contract, subject to the resolution of any timely protests, underRequest-for-Proposal No. C1045 with Skanska, Traylor and Shea, a JointVenture (STS), the responsive and responsible proposer determined to provideMetro with the Best Value for the final design and construction of the WestsidePurple Line Extension Project, Section 1 for a firm fixed price of $1,636,418,585.

B. Authorize the Chief Executive Officer to execute future individual contractmodifications to Contract No. C1045 up to an amount not to exceed $1,000,000for each individual contract modification within the Board approved policy of 10%for contract modification authority.

C. Establish a Life of Project (LOP) Budget of $2,773,879,593 for the WestsidePurple Line Extension Project, Section 1 and No. 865518, including a costincrease of $288,170,284 relative to the Lonq Range Transportation Plan.

D. Authorize the CEO to exercise Option 1, for the crossover ventilation system inthe amount of $3,150,000 within six months of Contract Award.

ISSUE

On September 27, 2012, the Board authorized staff to use adesign-build process tocomplete the final design and construction of the Westside Purple Line ExtensionProject, Section 1 and to solicit a contract for the 3.92 mile dual track heavy rail systemwith three new stations. The Board authorized the procurement under Public ContractCode Section 20209.5 et seq., which allows for the negotiation and award of a design-

build contract to a responsible proposer whose proposal is determined to be the bestvalue to Metro.

The Source Selection Plan and Request for Proposal (RFP) contained the weightedvalue assigned to each criterion. In accordance with Public Contract Code (PCC)20209.5 — 20209.14 and the RFP, "Best Value" is expressly defined as a valuedetermined by objective criteria and may include, but is not limited to, price, features,functions, life-cycle costs, and other criteria deemed appropriate by Metro; and the"Best Value Proposal" as the most advantageous Proposal to Metro when evaluated inaccordance with the Evaluation Criteria defined in the RFP.

The recommended action is to award the contract to the highest ranked and mostadvantageous proposer based on a "Best Value" procurement process. Therecommended contractor had the overall highest ranking, including the highest technicalscore based on the criteria in the RFP.

The solicitation process has been completed. This report provides a recommendationfor award of the contract within the Federal Transit Administration (FTA) approved FullFunding Grant Agreement (FFGA) and approved loan by the TransportationInfrastructure Finance and Innovation Act (TIFIA) Loan Office.

DISCUSSION

The Westside Purple Line Extension Project, Section 1 (the Project) is the first of threesections to be designed and constructed as part of the Los Angeles CountyMetropolitan Transportation Authority (LACMTA) Measure R Program. The programwas approved by Los Angeles County voters in November 2008 and provides a half-cent sales tax to finance new transportation projects. In April 2012, the three sections ofthe Project were environmentally cleared and adopted by LACMTA Board of Directors.

Section 1 will extend the existing Purple Line by 3.92 miles beginning at theWilshire/Western Station. From this station, the twin tunnel alignment will travel westerlywithin the existing Wilshire Boulevard right-of-way. Underground stations will be locatedat the intersections of Wilshire/La Brea, Wilshire/Fairfax, and Wilshire/La Cienega. Allthree of the station boxes will be located within the Wilshire Boulevard right-of-way withstation portals extending to off-street entrances.

The Project will also include train control and signals, communications, traction powersupply and distribution, and fare collection systems that will connect and operate with theexisting system. The Project schedule requires completion in October 2024.

Proposers were asked to price an option to include an internal exhaust plenum at thecrossover, including revisions to describe the emergency and maintenance scenariosthat are to be addressed by the crossover ventilation system. The option above is not

Westside Purple Line Extension, Section 1—Award D/B Contract &Establish LOP Budget

being exercised at award. The need for exercising the option will be determined up tosix months after contract award.

DETERMINATION OF SAFETY IMPACT

This Board action complies with established safety standards.

FINANCIAL IMPACT

Funds are included in the proposed FY15 budget for the recommended contract awardand adoption of the LOP Budget under Project 865518 — Westside Purple LineExtension Project, Section 1, in Cost Center 8510 (Construction Project Management),and Account Number 53101(Acquisition Building and Structure).

The Life of Project budget recommendation includes a cost increase of$288,170,284 over estimates used for planning and programming purposes. Thecost increase can be supported by Measure R 35% Transit Capital funding fromthe line item for this project in the Measure R Expenditure Plan, as discussed inAttachment C, the Measure R Cost Management Process and Policy Analysis.Approval of the cost increase will reduce funds available for a Westside/CentralArea Sub-Regional Measure R replacement proiect(s) from $788 million to $500million. No other sub-regions or Measure R projects are impacted.

Since this is a multi-year Project, the Executive Director of Engineering andConstruction and the Project Manager will be responsible for budgeting costs for futureyears, including any options exercised.

Impact to Budget

The sources of funds for the Project are capital funds identified in the proposed LOPBudget as shown in Attachment B. The recommended LOP Budget for Project No.865518 was assumed in the Long Range Transportation Plan for the Westside PurpleLine Extension Project, Section 1 and does not have an impact to operations fundingsources. The Measure R Cost Management Process and Policy Analysis, AttachmentC, describes the process available to close the ~ budget gap.

ALTERNATIVES CONSIDERED

The Board may choose not to move forward with the contract award and approval of theLOP. This is not recommended as this is an adopted project with the Long RangeTransportation Plan and not awarding this contract at this time will delay the scheduleand will increase the cost of the Project. If the Board does not approve the award orrequests a re-solicitation of the contract the following consequences may occur:


• Extensive schedule delays with no assurance of better pricing without significantde-scoping of the Project;

• No guarantee that the current proposers (or any others) will provide betterproposals in response to a future solicitation with the variable market conditions thathave been prevalent these last couple of years;

• Potential loss of funds under the FFGA; and• Potential loss of funds under the TIFIA Loan Agreement.

NEXT STEPS

Metro will issue a Notice of Award, execute a contract with the recommended contractorand once bonds, insurance, and project labor agreement requirements are met, issue anotice to proceed.

Metro staff has initiated discussions with the FTA regarding how to address the C1045contract amount in the context of the overall Westside Purple Line Extension, Section 1FFGA budget. To the extent required by the TIFIA loan documents, Metro staff willhave similar discussions with the TIFIA office regarding the Westside Purple LineExtension, Section 1 TIFIA loan. These discussions do not impact the proposed actionof the Board to approve contract award and adopt the LOP Budget per therecommended Board actions.

ATTACHMENTS

A. Procurement SummaryB. Funding/Expenditure PlanC. Measure R Cost Management Process and Policy Analysis

Prepared by: Dennis Mori, Executive Officer - Project Director (213) 922-7221

Rick Wilson, Director of Project Controls (213) 922-3627

David Yale, Executive Officer, Countywide Planning &Development (213) 922-2469

Bruce Warrensford, Director of Contract Administration(213) 922-7338


teph nie Wigg'Executive Director, Vendor /Contract Management

~`! ~'c''

Bryan P nnington, xecutive DirectorEngineering &Construction

Arthur TChief


ATTACHMENT A

PROCUREMENT SUMMARY

WESTSIDE PURPLE LINE EXTENSION PROJECT,SECTION 1 DESIGN-BUILDCONTRACT NO. C1045

1. Contract Number: C10452. Recommended Vendor: Skanska, Tra for and Shea STS , a Joint Venture3. Type of Procurement (check one): ❑ IFB ~ RFP ❑ RFP—A&E

❑ Non-Com etitive ❑Modification ❑Task Order4. Procurement Dates:

A. Issued: June 10, 2013B. Advertised/Publicized: June 20, 2013 13 ublicationsC. Pre- ro osal/Pre-Bid Conference: Jul 24, 2013D. Pro osals/Bids Due: Januar 30, 2014E. Pre-Qualification Com leted: Ma 29, 2014F. Conflict of Interest Form Submitted to Ethics: Februa 3, 2014G. Protest Period End Date: Jul 22, 2014

5. Solicitations Picked up/Downloaded:109

Bids/Proposals Received:3

6. Contract Administrator:Bruce Warrensford

Telephone Number:213 922-7338

7. Project Manager:Dennis Mori

Telephone Number:213 922-7238

A. Procurement Background

This Board Action is for adesign-build, "Best Value" procurement issued in supportof a contract for the management, coordination, professional services, labor,equipment, materials and all other services necessary to perform the final designand construction of the Westside Purple Line Extension Project, Section 1,(Project).

A two-step negotiated procurement process was utilized in accordance withCalifornia Public Contract Code § 20209.5 - 20209.14 and Metro's Acquisition Policyfor a Firm Fixed Price contract.

In step one, a Request for Qualification (RFQ) was issued that required interestedrespondents to submit Statements of Qualifications (SOQ), which were evaluatedbased on criteria set forth in the RFQ. In step two, a Request for Proposals wasissued to the pre-qualified respondents to submit separate technical and priceproposals.


Procurement Process —Step One

California Public Contract Code Section 20209.5 et seq. requires Metro to pre-qualify design-build entities using a standardized questionnaire developed by theState of California Department of Industrial Relations (DIR). Metro has thediscretion to add supplemental questions to the questionnaire, which Metro did tomatch the experience and past performance of respondents to the level ofcomplexity of this project.

The RFQ was issued on December 7, 2012. Four SOQs were received on February7, 2013. All four SOQs received from respondents met the minimum pre-qualification requirements and were invited to submit proposals.

Procurement Process —Step Two

The RFP was issued on June 10, 2013, requesting formal technical and priceproposals in accordance with the requirements defined in the RFP. Apre-proposalconference was held on July 24, 2013, in the Board Room with representatives ofapproximately 268 firms in attendance; numerous jobsite visits held for the primecontractors and their designated subcontractors; and 367 questions were receivedand answered.

Five amendments were issued during the solicitation phase of this RFP; amendmentNo. 1 issued on July 24, 2013 included various revisions and clarifications tocontract documents, technical project definition documents, and referencedocuments. Amendment No. 2 issued September 18, 2013 revised contractdocuments, technical requirements and reference documents. Amendment No. 3issued October 17, 2013 to clarify contract requirements, implement DBE raceconscious goal requirements, revise technical project definition documents andrevise reference documents . Amendment No. 4 issued November 20, 2013 toextend the proposal due date, corrections to the price proposal form, revise technicalproject definition documents and revise reference documents. Amendment No. 5issued December 16, 2013 to extend the proposal due date, clarify evaluationcriteria, revise proposal submittal requirements and price proposal form.

A total of three proposals were received on January 30, 2014 in response to theRFP requirements, from Dragados / Astaldi /Southland (DAS) a Joint Venture akaDragados USA, Inc. (DUSA), Southland Contracting, Inc., and Astaldi ConstructionCorporation; Skanska, Traylor and Shea (STS) a Joint Venture aka Skanska USACivil West California District Inc., Traylor Bros., Inc., and J.F. Shea Construction,Inc.; and Westside Transit Partners — WTP (Impregilo S.p.A., Samsung E&CAmerica. Inc., and Salini USA. Inc.). Although the solicitation process allowedProposers to submit alternate proposals, none were submitted.

Amendment No. 6 and Request for Best and Final Offers (BAFO) issued May 2, 2013established BAFO submittal requirements, clarified technical project definitiondocuments and included Option 1. The BAFOs were received on May 30, 2014.


B. Evaluation of Proposals/Bids

A Proposal Evaluation Team (PET) consisting of representatives from MetroEngineering and Construction, Metro Operations, and the City of Los Angeles,Bureau of Engineering Department of Public Works, was convened and conducted athorough and comprehensive evaluation of the proposals received.The proposals were evaluated based on the following evaluation criteria andweights:

• Project Management 25%

• Technical Approach 35%

• Price 40%

The technical and project management evaluation criteria was assigned a combinedhigher percentage than price in consideration of the tunneling complexity and gassyconditions of the Project site. All project requirements were considered whendeveloping the weights above to establish that the best value selection wouldproduce the Proposer most capable of addressing the unique technical challengesassociated with this project.

The weighting assigned for the following minimum factors collectively represented atleast 50% of the total weight given to all criteria factors: price, technical expertise,life cycle costs over 15 years or more, skilled labor force availability, and acceptablesafety record, as prescribed by California Public Contract Code § 20209.8 (d).

Moreover, the best value selection criteria, their weights and relative importancewere provided to all Proposers as part of the RFP document.

The PET met extensively in the months of February 2014 through June 2014, tothoroughly review and evaluate the original and revised written proposals submitted.The PET asked for written clarification to questions posed of each team, with writtenresponses being submitted by proposers to assess each team's technicalapproaches, and previous experience.

After the PET scored the original written proposals, reviewed answers to clarificationrequests, they had interviews with key personnel and held one-on-one discussionswith each proposer prior to issuance of the request for Best and Final Offers. Allthree proposers submitted their Best and Final Offers on May 30, 2014. After theBAFOs were received the PET completed its review and evaluation of the revisedproposals on June 16, 2014.

Qualifications Summary of strengths and weaknesses for all three proposers:

Skanska, Traylor and Shea (STS), a Joint Venture, •Parsons Corporation as leaddesigner and •Comstock as systems subcontractor


STS summary of strengths:

• Highest rated technical and project management resources stand prepared toprosecute work immediately

• Proposes early completion schedule saving 300 calendar days

• DBE goal of 20.25% for Design and 17% for Construction

• STS and all key personnel demonstrate the greatest depth of combined relevantexperience working together on major capital projects such as:

• Metro Gold Line Eastside Extension Light Rail Transit (LRT)• City of LA North East Interceptor Sewer tunnelExposition LRT —Phase 2Foothill Extension LRT

• STS and proposed subcontractors have an established, recognized workingrelationship

• Side-by-side schedule analysis of the Regional Connector and Westside PurpleLine demonstrates sequencing that does not create overlapping conflicts. Thereare no major scheduling or personnel conflicts between Shea's tunneling work onthe Crenshaw and the Westside Projects

• STS has very good experience in executing mitigation measures that addressthird party and community concerns

• STS proposes to supplement Project Manager with "Value Added" personnelwho strengthen their team's project management commitment, technical capacityand capabilities

STS summary of weaknesses:

• Proposed Project Manager also selected for the Regional Connector as theProject Manager

• Highest price offer

Westside Transit Partners — WTP (Impregilo S. p.A., Samsung E&C America. Inc., andSalini USA. Inc.).

WTP summary of Strengths:

• Second lowest price offer


• WTP and key personnel demonstrate general combined experience on a varietyof similar major capital projects

WTP is utilizing ARUP and Mass Electric Co. and other key subcontractors withexperience in the LA area and Metro

WTP summary of weaknesses:

WTP Project Manager has limited transit experience. The relationship of theProject Manager to the Deputy Project Manager and team did not demonstrate astrong working history

WTP's Construction Approach as presented in their detailed schedule does notprovide a realistic schedule for the three cut-and-cover station sites

Construction Approach as presented in their Detailed Schedule submittalexposes Metro to a high probability of cost and schedule risk

Dragados /Astaldi /Southland (DAS) a Joint Venture aka Dragados USA, Inc. (DUSA),Astaldi Construction Corporation and Southland Contracting, Inc.

DAS summary of strengths:

• Lowest price offer

DAS and key personnel demonstrate general combined experience on a varietyof similar major capital projects

• Proposes early completion schedule saving 180 calendar days

DAS summary of weaknesses:

• DAS Project Manager does not have rail transit experience and limited projectmanagement experience.

• DAS Deputy Project Manager has recent project management experience on amulti-lane motorway highway tunnel project and no major experience on railtransit or other relevant major construction projects.

• Proposal illustrates a weak understanding of the overall Project as demonstratedby the organizational discontinuity between the Project Manager, DesignManager and key personnel, who were not familiar with the details of thecontents of their Request for Proposal (RFP).

• All "Added Value" personnel who were in the original proposal were removedafter the BAFO.

Westside Purple Line Extension, Section 1—Award D/B Contract &Establish LOP Budget 10

• DAS' description of their Construction Approach was not supported by athorough detailed schedule.

• Construction Approach as presented in their Detailed Schedule exposes Metro toa high probability of cost and schedule risk.

Based on a thorough and integrated assessment of the proposals, as performed anddetermined by the Proposal Evaluation Team, and in accordance with the RFP specifiedevaluation factors and sub factors, the STS proposal offers the "Best Value" and is themost advantageous to Metro. The final scores and ranking for all proposers issummarized in the following table:

FIRM FactorWeight

FinalWeightedScore

Rank

1. Skanska, Traylor and Shea, a JointVenture STS

1

Project Management (13 factors) 25% 19.83

Technical Approach (3 factors) 35% 27.42

Price (*3 factors) 40% 30.98

Total 100.00% 78.23

2. Westside Transit Partners - WTP(Impregilo S.p.A„ Samsung E&C America,Inc., and Salini USA, Inc.

2




Total 100.00% 74.64

3. Dragados / Astaldi /Southland (DAS)a Joint Venture

3




Total 100.00% 69.37

* The evaluation factors for the Price category included overall proposed price, daily delay compensationrates and life cycle costs.

C. Cost/Price Analysis

The recommended price has been determined to be fair and reasonable based uponadequate price competition, discussions, a full technical analysis, and a


comparative price analysis, including Metro's Independent Cost Estimate (ICE). Therecommended Proposer's price is less than 1 %higher than the ICE. Therecommended award is for the highest ranked proposer based on the "Best Value"procurement process.

Bidder/Proposer Name Total Evaluated Pricin Award PriceOriginal Best and Final Best andProposal Offer Amount Final OfferAmount (BAFO)

1. Skanska, Traylor andShea, a Joint Venture $1,672,150,915 $1,650,941,000 $1,636,418,585STS

2. Westside TransitPartners - WTP(Impregilo S.p.A„ $1,641,022,256 $1,596,500,000 $1,571,775,900Samsung E&C America,Inc., and Salini USA,Inc.

3. Dragados / Astaldi /Southland (DAS) $1,476,446,876 $1,459,886,068 $1,443,878,064a Joint Venture

D. Background on Recommended Contractor

The recommended firm, Skanska, Traylor and Shea, a Joint Venture (STS) wasformed for the Westside Purple Line Extension Project, Section 1 with offices indowntown Los Angeles. Skanska is a 125-year old company and one of the largestconstruction organizations in the world. Skanska has 39 offices throughout the U.S.,with its Southern California Office located in Riverside, CA, Skanska has over12,000 full-time construction industry professionals in the U.S. and has completed15 design-build rail and transit projects totaling more than $4.2 billion nationwide.These include the AirTrain JFK LRT in New York, the World Trade CenterTransportation Hub in New York, the I-210 Gold Line Bridge, and the Expo Phase 2project. Skanska is also the contractor on the BART Berryessa Design-Build TransitExtension. The Traylor Bros. Southern California office is located in Long Beach,CA and it has a track record that features over 110 tunneling projects with more than90 miles of bored tunnels, as well as a 50-year presence in southern California.Traylor's experience with Metro includes the Metro Gold Line Eastside Extension,with over 4.5 million safe work hours and zero ground loss, and the Metro Red LineSegment 3 Hollywood tunnels. Their tunneling work also includes the UniversityLink (U220) in Seattle, and the Queens Bored Tunnels East Side Access project inNew York, which was named the 2012 Project of the Year by the InternationalTunnel Association. Shea headquarters are located in Walnut, CA and hascompleted $21.6 billion in California projects since the 1920s as a 131-year olddesign-builder and general contractor. From subways to pipelines and dams, Shea


has carved miles of tunnel out of similar ground conditions. The firm's technologicalexpertise has greatly enhanced the efficiency of tunneling, and it specializes inunderground work. Shea partnered with Skanska on the Second Avenue Subwayand the No. 7 Line Subway projects in New York. Shea also led the joint ventureteam on the Metro Red Line Subway (Segment 2) project for Metro in 1995, whichincluded gassy conditions similar to the Westside Subway. Shea brings successfulexperience with a multitude of geological conditions in large subway and transitprojects. Parsons Corporation will be the lead designer and Comstock isresponsible for the systems integration. Parsons, based in Pasadena, CA, is aglobal leader in the engineering and construction of major transportation projects incomplex, urban environments. They have completed transit design-build projects forMetro, Bay Area Rapid Transit (BART), DART, the Denver Regional TransportationDistrict and Minneapolis Metro Transit.

STS's Project Manager, Mike Aparicio, has 27 years of experience in the heavy civilconstruction industry, including 20 years managing transportation and heavy civilconstruction projects and organizations. He has significant large-scale design-buildexperience, including the management of more than $1.5 billion in design-buildprojects since 1997. He has an excellent record for successfully managingcontractor, designer, subcontractor and owner interests, specifically on Los Angelesdesign-build transit contracts. Mr. Aparicio's background includes project managerfor the Metro Gold Line Eastside Extension Project, and management roles for Expo2, and the Pasadena Metro Gold Line projects. Jim Klemz, with Parsons, is theDesign Manager/Principal Engineer, licensed and registered in the State ofCalifornia, with 36 years of civil engineering experience on large design-buildprojects. Mr. Klemz' experience includes being Design-Build Sponsor on the FoothillPhase 2A and the I-25 T-REX Project. His extensive construction supervisionexperience includes contract management and administration, scheduling, qualitycontrol, and design activities related to construction. Richard Weldon, with Skanska,is the Construction Manager, with experience managing safety, quality, engineeringand construction issues. His experience includes the Eastside Extension and hismost current assignment as the Construction Manager on Expo 2.

E. (1) Small Business Participation - Design

The Diversity and Economic Opportunity Department (DEOD) established a RaceConscious Disadvantaged Business Enterprise (RC DBE) goal of 20%for Design.STS met the goal and made a 20.25% DBE commitment.

SMALL SMALLBUSINESS 20.00%

BUSINESS20.265%

GOAL COMMITMENT

DBE Subcontractors Ethnicit %Committed1. BA, Inc. African Amer. 2.96%2. V&A, Inc. His anic 6.21


3. C2PM Asian Pac. 2.50%4. TOGO Asian Pac. 2.95%5. IEG (Innovative Engineering

GroupAsian Pac. 3.53%

6. Mia Lehrer Hispanic 0.72%7. MGE Asian Pac. 0.70%8. Martini Drillin His anic 0.57%9. California Testin and Inspection Hispanic 0.11

Total Commitment 20.25%

E. (2) Small Business Participation - Construction

The Diversity and Economic Opportunity Department (DEOD) established a RC DBEgoal of 17.00% for Construction. STS made a 17.00% DBE commitment. To beresponsive to DBE requirements, STS was required to identify all known DBEsubcontractors at time of proposal. STS listed one DBE firm as noted below. Inaddition, STS was required to submit a DBE Contracting Plan identifyingconstruction opportunities to meet its DBE commitment. STS must update itsContracting Plan monthly, as contract work is bid and awarded to DBE firms. DEODreviewed and approved the Contracting Plan submitted by RCC.

SMALL SMALLBUSINESS 17D.00%

BUSINESS17D.00%

GOAL COMMITMENT

DBE SubcontractorsConstruction

Ethnicity %Committed

1. The Solis Group His anic 0.05%

Total Commitment 17.00%

F. All Subcontractors Included with Recommended Contractor's Proposal

Subcontractor Services Provided1. Aldea Services, LLC Risk Management

2. BA, Inc. Utility Engineering

3. C2PM Admin Project Controls

4. California Testing &Inspection Testing Laboratory


5. CH2M Hill Engineers, Inc. Geotechnical Design,Tunnel Design, Str.En ineerin

6. Comet Electric Electrical

7. Group Delta Consultants, Inc. Geotechnical Engineering

8. IEG (Innovative Engineering Group) Electrical Eng

9. KDC, Inc. dba Dynaelectric Electrical

10 Kroner Environmental Services Environmental

11. L.K. Comstock National Transit Systems

12. Martini Drilling Corp Soil Boring Sampling

13. MGE Structural Eng

14. Mia LehrerLandscape Arch

15. Parsons Transportation Lead Design

16. Psomas Design and ConstructionSurve

17. The Solis Group Jobs Coordination

18. TOGO Ductbank Engr. Arch.

19. University Mechanical Mechanical/Plumbing

20. V&A, Inc. General, Civil and TrafficEngineerin


ATTACHMENT B

WESTSIDE PURPLE LINE EXTENSION PROJECT, SECTION 1

Funding/Expenditure Plan(Dollars in Millions)

~ ofCapital Project 865518 Prior FY14 FY75 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 TotalTotal

Uses of Funds

Construction 2.4 12.0 149.5 263.1 230.0 406.6 2512 114.6 136.0 110.4 60.1 1.5 - - 1,737.4 62.6%

Right-of-Way 0.9 3.8 146.6 22.3 - - - - - - - - - 175.6 6.3%

Vehicles - - 3.9 10.7 11.1 31.9 48.6 49.8 42 - - - - 1602 5.8%

Professional Services 562 30.0 48.4 45.9 34.3 33.7 32.5 28.1 30.8 31.9 31.8 9.1 - 472.7 14.9%

Project Contingency - - 32.3 33.6 34.6 35.7 36.7 21.4 22.0 22.8 8.5 1.0 - - 246.6 9.0%

Subtotal Capital Project 59.5 45.8 382.7 375.6 310.0 507.9 369.0 213.9 193.0 165.1 100.4 11.6 - - 2,734.5 98.6%

Environmental/Planning 38.5 0.5 0.4 - - - - - - - - 39.4 1.4%

Total Project Cost 98.0 46.3 383.1 375.6 310.0 507.9 369.0 213.9 793.0 165.1 100.4 11.6 - - 2,773.9 700.0°/

Sources of Funds'

Federal 5309 New Starts - 65.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 85.0 1,250.0 45.1

Federal TIFIA LoanProceeds (Repaid with - - - - - 340.7 305.7 184.9 24.7 - - - - 856.0 30.9

Measure R 35%)

Measure R 35% 31.3 (18.7) 2572 267.9 202.5 642 (39.5) (71.0) 43.7 68.4 (29.7) (97.3) (100.0) (85.0) 494.0 17.8%

Lease Revenues - - 19.0 - - - - - - 18.7 - - - 37.7 1.4%

Repayment from State of57.8 - 6.9 6.1 - - 1.5 - 24.6 (27.0) 5.1 (13.1) (22.0) - 39.9 1.4%

Cap Project Loans

LTF General Revenues 1.8 ~•8 ~~~

TDA 4.1 - - - - - - - - - - - 4J 0.1

STIP Regional Improvement2.6 - - - - - - - - -

_ 2.6 0.1Program

City of los Angeles- ~ - - - - ~~3 - - 5.0 25.0 22.0 22.0 _ 75.3 2.7%

Contribution

Federal Section 5339 04 0.4 0.0%Alternatives Analysis

Federal CMAQ - - 1.6 7.5 3.0 - - - - - - - 12.7 0.4%

Total Project Funding 98.0 46.3 383.7 375.6 310.0 507.9 369.0 213.9 193.0 765.1 100.4 11.6 - - 2,773.9 100.0%

*Timing of funding sources is subject to change.

Westside Purple Line Extension, Section 1-Award D/B Contract &Establish LOP Budget 16

ATTACHMENT C

WEST~SIDE PURPLE LINE EXTENSION PROJECT,SECTION 1

Measure R Cost Management Process and Policy Analysis

Introduction

The Measure R Cost Management Process and Policy (the Policy) was adopted by theMetro Board of Directors in March 2011. The intent of the Policy is to inform the MetroBoard of Directors regarding potential cost increases to Measure R-funded projects andthe strategies available to close any funding gaps. The Westside Purple Line Extension(Westside Subway Extension) Section 1 Project warrants such an analysis due to a$288 million cost increase described in the report accompanying this analysis_However, the Measure R funds targeted to all three Westside Subway sections to dateamounts to $3,285.8 million (out of a total Measure R commitment of $4,074 million).The remaining $788.2 million is available to address cost increases on this project, asdescribed in the "Other Cost Reductions in the Same Subregion" section of thisanalysis._ We are recommending this solution to the cost increase issue.

Measure R Cost Management Policy Summary

The adopted final Measure R Unified Cost Management Process and Policy stipulatesthe following:

"If increases in cost estimates occur, the LACMTA Board of Directors must approve aplan of action to address the issue prior to taking any action necessary to permit theproject to move to the next milestone. Increases in cost estimates will be measuredagainst the 2009 Long Range Transportation Plan as adjusted by subsequent actionson cost estimates taken by the LACMTA Board of Directors. Shortfalls will first beaddressed at the project level prior to evaluation for any additional resources usingthese methods in this order:

1) Value engineering and/or scope reductions;2) New local agency funding resources;3) Shorter segmentation;4) Other cost reductions within the same transit corridor or highway corridor;5) Other cost reductions within the same sub-region; and finally,6) Countywide transit cost reductions and/or other funds will be sought using pre-

established priorities. "

We followed the six steps prescribed by the policy to address the funding gap anddeveloped the following plan of action:


Value Engineerinq and/or Scope Reductions

During the development of the Preliminary Engineering for the Request for Proposal(RFP) documents, staff conducted Value Engineering (VE) Workshops utilizing a VEPanel of transit industry professionals with participation including the FTA's ProjectManagement Oversight Consultant (PMOC). The VE items believed to have thepotential of yielding the largest cost savings were incorporated into the AdvancedPreliminary Engineering (PE) designs in 2012. These items included the reduction ofunderground station footprint sizes and station depths. Station room layouts and otherarchitectural elements were standardized to reduce design, construction, operationsand maintenance costs. The cross-over ventilation extended plenum design which isnot required as part of the normal ventilation design, was included as an option tosupplement ventilation during periodic track maintenance work. The Project Team alsoanalyzed constructability issues and various construction sequencing scenarios toreduce risks and the overall durations for tunneling and cut-and-cover undergroundconstruction.

New Local Agencv Funding Resources

Per Note G in the Measure R Expenditure Plan, local agencies are expected tocontribute an amount equal to three percent of total costs for transit projects. Metro andthe City of Los Angeles agreed to a 3% contribution amount in April of 2014. Thatagreement states the following with respect to cost increases and betterments:

"The parties understand the City's Westside Subway Extension Section 1 Sharewill not increase even if the final LACMTA adopted life-of-project budget for theWestside Subway Extension Section 7 project exceeds $2,509,100,000."

and

"Any Project betterments for each Project shall be paid by the City separate andapart from this Agreement and shall be defined in and paid pursuant to theMaster Cooperative Agreement, dated January 21, 2003 ("MCA')."

Pursuant to the agreement above, we are not assuming any additional commitmentfrom the City of Los Angeles for the project as these are not betterments as defined inthe MCA.

Similarly, the $1.25 billion New Starts Full Funding Grant Agreement executed betweenthe FTA and Metro on May 21, 2014 states that all cost increases are to be borne by theproject sponsor, not the Federal Transit Administration. Pursuant to that agreement, weare assuming that no additional New Starts funds can be made available to cover thecost increase.


Shorter Segmentation

While shorter segmentation is possible for the Westside Subway Extension, werecommend against this step for several reasons. Section 1 was extended toWilshire/La Cienega due to engineering constraints at the initial Section 1 terminus atWilshire/Fairfax. Shortening Section 1 would likely result in further cost increases to theproject and require deferral of other projects. The only Section which could beshortened is Section 3. This would require eliminating the Veteran Affairs Station andmoving the terminus to Westwood. In addition to higher real estate prices in Westwood,eliminating the Veteran Affairs station would require LACMTA to prepare asupplemental Environmental Impact Statement/Environmental Impact Report (EIS/EIR)due to significant project changes. As a result, there may be significant project delaysand increased costs to the project. We do not recommend shorter segmentation.

Other Cost Reductions within the Same Transit Corridor

The Westside Subway Extension corridor had included the Wilshire Bus Rapid Transitproject. This project was bifurcated into two parts, one is a limited peak hour onlyversion of BRT that is already funded with federal grants and the other was a morerobust BRT with dedicated lanes and ride improvements. This second Wilshire BRTproject was already eliminated from the LRTP to deal with prior cost increases.

Other Cost Reductions within the Same Subregion

As of March 13, 2014, the Long Range Plan Financial Forecast update prepared insupport of the Short Range Transportation Plan (also on the July 2014 agenda forapproval), the Measure R funds targeted to all three Westside Subway sectionsamounted to $3,285.8 million (out of a total Measure R commitment of $4,074 million).The remaining $788.2 million is described in the supporting Financial Forecast for theShort Range Plan as a "Subregional payback for Westside Purple Line Extension" thatwas scheduled to occur in the third decade of the Long Range Plan (FY 2030 andbeyond).

We believe we can pay for the Westside Subway Section 1 cost increase of $288 milliondirectly from Measure R or, if necessary, incur additional bond debt to cover the costincrease. Such additional indebtedness is restricted by the Measure R ContingencyPolicy adopted by the Board in May 2011 (and amended in April 2012). Our review ofthe status of Measure R borrowing to date (including all planned borrowing) indicatesthat the additional borrowing to make these funds available for the Westside SubwaySection 1 project is entirely within the policy cap established by the Metro Board ofDirectors.

Countywide Transit Cost Reductions and/or Other Funds

This cost increase does not require any countywide cost reductions or other funds.


2009 LRTP -Tr

ansi

t Corridors

.Fernando Valley

San Fernando Valley Esst

NorthlSouth Rapfdweys'R

~~~

r~~..~~`

•,.,_.

_?~ O~~

e

y.....

...._.

.•:

San Fer

nand

o Ualley

~~ ~_ i

NorthlSouth Canoga Ext

ensi

on;:

"-

(und

er con

stru

ctio

n)'~

t.~.

,~~

_~

`a

~'n.

WARNER '

m~a

cer~rER

Seouly! eda Ras

s Co

rrid

or*F

i;VNlshire BRT

Las Virgenes/Malibu

South Los An

gele

s Co

unty

Arro

yo Verdugo

'?~

Regional Con

necr

or•R

pggqpENA

C2~tf8I`

Gdd Line Fo

Whil

l Li

ght

;os An ales '

Ralf

Transit Ext

ensi

on(u

nder

cons

truc

tion

l _.__

- .__.

...._.

..

EL,-MAN TE

j

MONICA

~~

W~ytside Subway Eztension'R

~~~

~~~~,,.

'~

wtishireBRT-us.s.

,'~~

g~'~

9"'a

"~s)

_ ~' ~

~ San GabrielValtey

•

~. ~

/"Y~

~ ._

s,

to Santa Monica'R

~

Expo

sdio

n Phasa I p

a(undercnnstruction)

SAX

rgn„

$"Crenshaw

~°gym

Tran

sit C

Green Line

Exte

nsio

n to LAX"~

~

i~3

Nort

hHi

gh Speed Raii

Los Angeles

Union St

atio

n to Palmdale"

COUIl~I

t /

{j,j

} ': ,138

i,~,

`,,

`~,

t xBSOtItlt

~ ~.

math L

iM,v'511.RP,rD1p 6 15_Haxd Nequ2sL_M

2as:reRUNxO;iTrtuislCoinsYa~„30

1U, re

vJe~

v4_~

yJ l2

inxt

)Gr

81c i;~ldl~2. 11$13 Pt

vi

N O

say

SAN

~

w

i •. f3ateway Citie

~/L

AX

~~~

orri

dar*~

+

~y

5

-.

~r`~

NORWAIK

., •~.,

West Santa Ana

fren

ch Caridor'R

n~R

LONG

;. ~ \ a.

Inland Cor

rido

r'Ea

stsf

de Trensit

Corrida Phasa II'R

(3 alt

erna

tive

s)

to L.A* ORANGE COUNTY

~= Men

su~e

R fundcA projects

*Project alignments to be determined

VS.S: Ver

y5rn

a/15

tart

s

Purple Line Extension contract staff report

Documents

Transcript of Purple Line Extension contract staff report