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Safe & Sound Bridge Improvement Program

Safe & Sound Bridge Improvement Program. ‘MHTC Launches Largest Bridge Program in Missouri’s History’. Statewide system improvement 802 bridges repaired or replaced Construction begins in Spring 2009. Pricing/Negotiation History. Fall ’06 – DBFM procurement began

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Safe & Sound Bridge Improvement Program

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  1. Safe & SoundBridge Improvement Program

  2. ‘MHTC Launches Largest Bridge Program in Missouri’s History’ • Statewide system improvement • 802 bridges repaired or replaced • Construction begins in Spring 2009

  3. Pricing/Negotiation History • Fall ’06 – DBFM procurement began • Spring ’07 – initial technical proposals received • Late Summer ’07 – special legislative session • “We know that the concept is viable, now we have to determine if it is affordable.”

  4. Pricing/Negotiation History Preferred Pricing Structure – November ‘07 MBP - $83.2 million/year TU - $125.5 million/year Alternative Pricing Structure – November ‘07 MBP - $70.7 million/year TU - $93.9 million/year

  5. Pricing/Negotiation History BAFO – December ‘07 MBP - $59.1 million/year (25 years) TU - $65.3 million/year (35 years) • MBP selected as apparent best value proposal. (Commission action on 12/19/07) • MBP price came with conditions – “less for less.”

  6. Pricing/Negotiation History February ‘08 MBP - $52.7 million/year • Accepted by MoDOT, contingent on MBP acceptance of market risk up to contract execution. • MBP unwilling to accept market risk. • MoDOT agreed to continue discussions.

  7. Pricing/Negotiation History March ‘08 • Parties tentatively agreed on contract terms. • Price range – $62-64 million with daily fluctuations. • MBP financing team indicates problems with use of original financing mechanism.

  8. Pricing/Negotiation History April / May ‘08 • Price range – $66-77 million per year. • MoDOT refinancing of debt at 6/7-year “put” estimated to be $56-59 million per year. • Key decision items identified.

  9. Pricing/Negotiation History June ‘08 • Limited Notice to Proceed issued (up to $10 million) for design and field tasks. July ‘08 • MoDOT prepares District staff for contract execution and implementation. • Traffic control (detours) for closed structures • Web site development • Quality control expectations

  10. Pricing/Negotiation History August ‘08 • USDOT/FHWA determine that MoDOT procurement was valid.

  11. Pricing/Negotiation History September ’08 • Estimated price is $65-74 million per year. • MoDOT’s optional bond refinancing is estimated to be $65-71 million per year. • MoDOT budgeted $50 million annual payment.

  12. Financial Impact Financial Analysis of Future Payments • Current state revenue trends could impact project commitments in current STIP. • Federal funding outlook is grim. • At the $65-74 million annual price, it is not possible to implement the DBFM contract and honor the MHTC’s approved funding distribution process.

  13. Recommendation toLaunch Safe & Sound Conclude current procurement. • Financial market crisis has made private financing for a project of this magnitude unaffordable. Proceed immediately with an alternate method to improve 802 bridges. • Construction underway Spring 2009.

  14. Recommended Alternate Procurement Process • Use Modified Design-Bid-Build process to improve 248 bridges. • At least 100 bridges under construction by Spring ’09 • Multi-bridge packages by location, type, size, etc. • Immediately seek Design-Build proposals for remaining 554 bridges. • Two proposals are needed per Missouri law. • MoDOT will finance the project.

  15. Alternate Procurement Costs MoDOT estimated costs for alternate procurement. • GARVEE bonds issued by MoDOT. • Approximately $50 million estimated annual cost to MoDOT.

  16. RecommendedCommission Actions • Concur that financial market crisis has made the current process unaffordable. • Authorize payment of a $2 million stipend to Missouri Bridge Partners. • Launch Safe & Sound with alternate procurement process.

  17. Questions?

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