contracts thread fmcb readout 09/14/2015 draft for discussion & policy purposes only 0 draft

Contracts ThreadFMCB Readout

09/14/2015Draft for Discussion & Policy Purposes Only

1

DRAFT

Draft for Discussion & Policy Purposes Only 2

Contracts Working Group Efforts.

DRAFT

Strategic-Sourcing: Key Focus: Identify Opportunities to Develop Flexible Contracting

Approaches. Discussion on Prioritization, Development of Methodology for

Evaluating Sourcing Opportunities.Public-Private Partnerships:

Bus Services RFIs. Existing Bus Services at Capacity, Third-Party Partnerships Could

Enable MBTA to Expand Service.Vendor Spend Analytics:

Research Different Product and Service Areas with Focus on Cost Reduction.


The legislation creating the FMCB lays out 13 distinct areas on which the FMCB is to report on monthly and annually:

1. capital planning2. separation of capital and operating budgets3. own-source revenue4. review of expansion proposals5. procurement and contracting improvements6. emergency preparedness7. internal reorganization8. customer-oriented performance management9. best practices for workplace productivity10. reducing employee absenteeism11. public-private partnerships12. the sale and lease of real estate assets13. development of performance metrics across organization

FMCB deliverables

Contracts Working Group Team Deliverables

DRAFT


In addition, there are 6 additional powers and responsibilities of the FMCB:

1. to develop 1 and 5 year operating budget beginning with FY 2017, balanced thru own-source revenue and cost control, which will facilitate the transfer of capital employees to the operating budget

2. to establish 5 and 20 year capital plans3. to establish a performance management system4. to review any service contract5. to change fares consistent with chapter 46 6. to reorganize internal structure of the MBTA (pending MassDOT board approval)

Additional FMCB mandates

DRAFT


Contracts Team Process and Timeline.

Phase 19/20 report

Phase 212/15 report

Phase 32016

• Create Strategic Sourcing Working Group.• Key focus – identifying

opportunities to develop flexible contracting approach to Strategic Sourcing and Public-Private Partnerships. Prioritization Discussions Development of Methodology for

Evaluating Sourcing Opportunities.

• Developed and issued RFI #118-15 for moderate-ridership, express bus service routes, and RFI# 119-15 for late-night bus service routes.• Initiate Vendor Spend Analysis.

• Present Wave 0 RFIs. Response Results to FMCB with goal of converting to possible RFPs.• Initiate Wave 1 RFI processes.• Initiate Operating Model

Changes: Build Strategic Sourcing

Capability Category Management.

Spending/Data Analytics. Fleet Procurement Contract

Management CPO Management Support to

Enhance Service Delivery. Control Costs More Effectively

through Reorganization of Central Stores Warehouse and Base Locations/Processes.

• Implement Wave 0.• Continue Wave 1 and Wave 2

RFIs.• Continue Operating Model

Changes. Non-Core Category Management. Fleet procurement. Staff Skill Building. Warehouse Rehabilitation.

• Tighten Spending Controls: Initiate shift from Vouchers to Purchase Orders payments.• Build partnership with

Operations.• Implement efficiency changes to

Warehouse Operations.• Initiate Vendor & Supplier

Development Plan.

DRAFT


Contracts Team:Objectives & Philosophy.

DRAFT

Objectives

Improve Service.• Existing Services.• New and Enhanced Offerings.

Increase Value.*

• Higher Revenues.• Cost Reduction.• Capital and Asset Efficiency.• Lower Administrative Cost.

Innovate.

Reduce Risk.

Philosophy for Change

• Focus on Core Capabilities:

“Do What We Do Best.”

• Leverage Existing Assets:

“Better Use What We Have.”

• Engage the Right Partners:

“Capitalize on Others’ Expertise, Assets, and Market Position.”

• Build-Up Our People:

“Make The MBTA a Great Place to Work.”

* Materials Management is developing a robust Lifecycle Cost framework (LCC) in collaboration with the CFO’s, COO’s and CAO’s offices.


• Leverage Public-Private Partnerships and Vendors– Create Public-Private Partnerships

that Complement MBTA Capabilities.

– Structure and Manage Vendor Contracts More Effectively.

– Pursue Alternative Funding Models.

• Collaborate with Operations– Improve Supply Chain

Management.– Use Spend Analytics to Target

Efforts.– Build Procurement Relationships

with Other Transit Organizations.

DRAFTContracts Team’s Deliverables Share the Same Solutions.

FMCB Priority Areas: Contracts Team Solutions:

1. capital planning2. separation of capital and operating budgets3. own-source revenue4. review of expansion proposals

5. procurement and contracting improvements

6. emergency preparedness7. internal reorganization8. customer-oriented performance

management9. best practices for workplace productivity10. reducing employee absenteeism

11. public-private partnerships12. the sale and lease of real estate assets13. development of performance metrics across

organization



DRAFT

Public-Private Partnerships: Bus Services RFIs. Existing Bus Services at Capacity, Third-Party Partnerships Could

Enable MBTA to Expand Service.


MBTA has Historically Partnered with a Variety of Private Firms to Improve Service Delivery.

DRAFT

Business Partner Service AreaKeolis Commuter Rail OperationsGreater Lynn Senior Svc. Paratransit ServicesVeteran’s Transp. Paratransit ServicesNational Express Transit Co. Paratransit ServicesLAZ Parking Parking Facility OperationsNolan Associates Ferry OperationsKONE, Inc. Elevator & Escalator MaintenanceS.J. Services Station & Railcar CleaningABM Janitorial Station CleaningEmpire Cleaning Railcar CleaningParatransit, Inc. In-Person Assessment of Paratransit

Applicants

Paul Revere Transp. Local Bus Service Routes (selected)Joseph’s Transp. Local Bus Service Routes (selected)Mass. Realty Group Real Estate Consulting


DRAFTAggressive Pursuit of Public-Private Partnerships.

I. Develop and Issue “Wave 0*” RFIs (#118-15, #119-15).1) RFIs Written, Received FMCB Approval.2) RFIs Issued 8/28, Manage Vendor Responses.3) RFI Respondent Conference. (9/8)4) Develop Evaluation Criteria. (9/21)5) Review Submissions. (10/1)6) Prepare Recommendations for RFP Opportunities. (11/3)

II. Prepare Wave 1 and Wave 2 Sourcing Opportunities.1) Collect List of Additional Sourcing Opportunities.

A. Working Group Reviews Wave 1 & Wave 2 List.B. New Opportunity Suggestions.

2) Prioritize Opportunities for Steering Committee & Executive Oversight Review.

3) Stage Selected Opportunities:A. Wave 1: Top 2-4 Opportunities.B. Wave 2: Next 3-7 Opportunities.

III. Manage Wave 1 Process.IV. Manage Wave 2 Process.* NOTE: “Wave 0” opportunities – Low-Ridership, Express, and Late-Night Bus Service – were not evaluated using new criteria; they represent specific areas prioritized by the FMCB .

✔️ COMPLETED ✔️ COMPLETED ✔️ COMPLETED


System Express Moderate-Ridership Late-Night

Avg. Ridership & Fraction of Total Rides

DRAFTWave 0 Private-Public Partnership Targets:Moderate, Express & Late-Night Bus Services.

31.1 riders/bus

17.0

14.4

10.1

0.94%

1.42%

0.06%

Avg. Riders per Bus

Fraction of Total Weekly Bus Rides

RFI#118-15

RFI#119-15

• Improve Service in Existing System by Redirecting Resources.• Capitalize on Third-Party

Provisioning Capabilities to Provide Existing Services Efficiently & Innovatively.


DRAFTMoving Aggressively to Pursue Wave 0 Opportunities.

8/17 8/24 8/31 9/7 9/14 9/21 9/28 10/5 10/12 10/19 10/26 11/2 11/9

Develop and Approve RFI

Issue RFI and Manage Responses

Evaluate Responses and Develop Recommendations for FMCB (potential RFPs)

FMCB RFI Review

8/24

Issue RFIs 8/28

Respond to Q&A

9/21

RFI Response Deadline

9/30

Assemble Evaluation Team 8/28

Begin RFI Review

10/1

Send Clarification Questions to

Vendors 10/5-9

Identify Vendors

for Interviews

10/14

Vendor Interviews 10/19-23

Finalize Recommendations

for FMCB 11/3

FMCB Review of Findings

11/9

ActionsKey Events

Important Future Dates:• Potential RFP Process 11/16/15-

2/15/16• Possible Contract Award mid-April

2016

TODAY

Vendor Conference

9/8

Finalize Evaluation

Criteria 9/21

Q&A Deadline

9/14


DRAFT

Timeline for Public-Private Partnerships.

7/1/15 10/1 1/1/16 4/1 7/1 10/1 1/1/17

Prepare RFI (2-4 wk.)

Issue RFI (3-5 wk.)

Evaluate RFI responses (3-6 wk.)

RFP Process -- drafting to contract award (20 wk.)

Wave 0:RFI-#118-15 &

RFI #119-15

Wave 1:2-4 RFI maximum

Wave 2:3-7 RFI

Define & Prioritize Target Areas

20162015

TODAY


DRAFTSystematic Approach to Evaluating Sourcing Opportunities.

Strategic Sourcing Ideas from All Sources:

Evaluate Using Specific Criteria:• Service Impact

• Economic• Operational

Prioritize and Manage:

FMCB/Governor’s Panel Report

Internal Ideas Exte

rnal

Suggesti

ons

• Wave 1: 2-4 opportunities

• Wave 2: 3-7 opportunities

Postpone or Drop from Consideration

Pursue Using Alternative Approaches (e.g., Telecom)

Possibly RecycleBased on Additional Information



DRAFT

Vendor Spend Analytics: Research Different Product and Service Areas with Focus on Cost

Reduction. Vehicle Suppliers. Transportation Services. Vehicle Parts and Maintenance. Other Services – e.g., Engineering, Station and Vehicle Cleaning.

Contract Review: Positive Train Control (PTC). CNR Orange & Red Line Railcars.


Transit Operations Vehicle Suppliers Vehicle Maintenance Other

FY ‘15 (million)

DRAFTImportant Categories of Spending with Major Suppliers (not complete).

KEOLIS (Commuter Rail)$297.7

National Express Transp. (RIDE)$28.0

Greater Lynn Senior Svc. (RIDE)$31.1

Veteran’s Transp. (RIDE)$37.9

Nolan Assoc. (Ferry)$13.7

Motive Power -- Locomotives$89.7

Hyundai Rotem – Commuter Rail Coaches

$32.7

CNR MA Corp. – Orange & Red Line Cars

$20.6

CAF USA – Light Rail Vehicles$12.5

New Flyer Industries Canada -- Buses$43.2

Alstom Transp. (GL #7 rebuild)

Midwest Bus Co. (Bus overhaul)

$18.5

$19.3

Bus Parts:• Midwest Bus Co.: $0.2• Dennison Lubricants: $0.8• Gillig LLC: $0.9• Muncie Reclamation: $1.2• Michelin NA: $2.0• Smith Intl.: $2.2• Power Products Sys.: $2.4• New Flyer Ind.: $2.7• Cummins Northeast: $3.9• NABI Parts: $4.0

Rail Parts:• Progress Rail: $0.9• Plasser American: $1.5• Cleveland Track: $1.6• Ray Jurgin, Inc.: $1.6• Swiger Coil: $1.8• Bombardier Transp.: $1.9• GE Transp.: $2.2• Wabco: $2.7• Wabtech Global: $4.9• Arthur J. Hurley: $5.9

KONE, Inc. – Elevator Maintenance$7.1

Empire Cleaning – Vehicle Cleaning$2.3ABM Janitorial – Station Cleaning$6.4

S.J. Services – Station & Bus Cleaning$15.0

Engineering Svc.:• STV-PB America JV: $1.4• LTK Engineering: $2.2• Parsons Brinkerhoff: $2.2• STV Inc.: $3.4• Ch2M Hill: $4.3

$408.4$198.7

$83.1

$44.3


DRAFT

PTC Contract

Positive Train Control (“PTC”) PTC is an Federal Railroad Administration (“FRA”) mandate (October 2008), with a December

2015 deadline for implementation.– Efforts underway to modify deadline and implementation criteria

PTC Core Requirements:– Protection from train-to-train collision, over-speed derailment, train incursions into work zones, etc.

PTC Status: – MBTA has been working on its PTC initiative since early 2010.– MBTA complied with FRA requirements to develop and present a PTC Implementation Plan by April

2010 and provided updated plans in 2013.– Progress since 2010 has been impacted by several factors including:

o MBTA expansion of the commuter rail network;o Protracted negotiations with Pan Am (Private Freight Network); and,o Capital funding constraints (MBTA PTC is an unfunded Federal mandate with an estimated cost

to implement of $489.6 M). PTC System Integrator Contract Procurement Status:

– September 2015 – Seek FMCB approval to enter into Contract with Preferred PTC System Integrator.– September / October 2015 – Negotiate Contract with PTC System Integrator.– December 2015 – Anticipated Notice To Proceed (“NTP”)


DRAFT

PTC Contract (p. 2)

Positive Train Control (“PTC”) PTC Implementation Schedule:

– Feedback received from RFA indicated that the MBTA needed to do a better on the delivery schedule. The preliminary MBTA PTC Implementation Schedule of 2021 would put us last of the major passenger rail operators. They are considering granting individual extensions to the existing 12/2015 required date. The FRA was looking at extensions to 2018 preferred or possibly 2020 at the outside.

Revised PTC Implementation Schedule:– The MBTA will proposed a “revised” PTC Delivery Schedule that will deliver PTC Implementation in

three completion phases:

South Side PTC – Milestone Goals4/2017: Design Complete7/2018: Installation Complete12/2018: Testing Complete / FRA Approved / PTC System Operational

North Side PTC – Milestone Goals1/2018: Design Complete1/2020: Installation Complete3/2020: Testing Complete / FRA Approved / PTC System Operational

Freight Corridor – Milestone Goals4/2018: Design Complete4/2020: Installation Complete8/2020: Testing Complete / FRA Approved / PTC System Operational


DRAFT

CNR MA Contract (“CRRC”)

CNR MA (In the Future the Company will be known as CRRC): CNR is the largest carbuilder in the world has recently merged with CSR the second

largest carbuilder in the world to form a new firm, CRRC.

MBTA Purchases:– Overall Contract Value of the Base and Executed Options is $565.2 M.– 152 Orange Line Cars (Replacing the current Orange Line Vehicle Fleet)– 74 Red Line Cars (Replacing the Red Line Number 1 Vehicle Fleet)– Additional Option Exercised – 58 Red Line Cars (Replacing the Red Line Number 2 Vehicle

Fleet)

Current Project Status: – The Overall Project is currently on schedule.– The Contract with CNR requires the submission of a Critical Path Method (“CPM”) Master

Project Schedule every thirty (30) days during the life of the contract.– The Chief Procurement Officer has requested a new position, “Fleet Procurement Contract

Manager,” to support this project and other major vehicle systems and integration projects.

contracts thread fmcb readout 09/14/2015 draft for discussion & policy purposes only 0 draft

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