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The Nuts and Bolts: Development and Implementation 39 Partner: CMT Methods: The following is a list of techniques that should be used to communicate and collabo- rate with Partners during this step: Collaborate with the CMT by means of in-person meetings and/or via collaboration tech- nology to Generate standards for project milestones to be used to develop all projects. Create categories of projects for the ACP. Generate a list of all projects proposed for the maintenance and improvement of all facilities. Reach consensus on the Project Request List to be evaluated in the next step. Communicate with Finance Department by means of in-person meetings and/or via collabo- ration technology on The scope, cost, schedule and operating costs for all proposed projects for discussion once projects are identified. The Lead Technical Department will revise, as necessary. On an ongoing basis throughout the process as scope, cost and schedule are revised and updated. Communicate with Finance Department and CMT by means of in-person meetings and/or via collaboration technology on the Project Request List. Products: The following is a list of written documents, processes, data, events, and/or other benefits that will be produced during this step: The Project Request List categorized by projects, by program, by facility, by funding source, and by fiscal year. Completed project data worksheet that describes the scope, cost and schedule for each proj- ect on the Project Request List, updated and/or revised when necessary. Existing facility condition survey reports. LCCA reports. Alternatives Analysis reports. Completed CIP Project Impact on Operating Budget forms. Long-Term Business Viability Analyses using ROI, IRR and/or Benefit Cost Analysis (BCA) methods, as appropriate. Result: The following are the results an agency can expect in terms of targets achieved, benefits realized and value added when an agency follows the recommended step outlined above: 1. All parties involved in development of the Project Request List agree on the content of the Project Request List before the Programming step begins. Step 4: Programming Goals: The goals of Step 4 are to 1. Analyze, evaluate and prioritize the Project Request List against agency goals and objectives, funding targets, revenue and operating expense projections, and rates and charges goals, using defined operational, financial and technical criteria. 2. Produce a draft ACP. Actions: The following is a list of actions, activities or tasks that should be completed during this step: Roles and Responsibilities: Define the roles and responsibilities of the two Leaders (Financial and Lead Technical Department) for this step. The two Leaders should agree on a commit- ment to work together on the actions outlined in this step.

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40 Collaborative Airport Capital Planning Handbook Prioritization Factors: Translate strategic direction provided in Step 1 above into prioritiza- tion factors, planning and evaluation criteria, and performance indicators. See page C-14 of Appendix C for PHX's CIP Priority Ranking Worksheet. Categories of prioritization factors and/or evaluation criteria may include Regulatory mandate--is it required to meet a code or regulatory compliance directive? Safety--will it improve or enhance safety? Security--will it improve or enhance security? Level of service--will it improve customer service or enhance facility capacity? Revenue generation/cost reduction--will it create revenue or reduce a current operat- ing expense? Environmental or community impacts--is it a commitment for environmental or commu- nity mitigation? Will it improve community relations? Might it cause negative environmen- tal or community impacts? Sustainable development--is it an initiative to meet sustainable development or Leader- ship in Environmental Design (LEED) goals? Asset preservation/maintain existing facilities--is it required to preserve or maintain an existing facility? Goals and objectives--does it contribute to meeting the agency's defined goals and objectives? Risk factors--are there any environmental, financial, schedule, or operational risk associ- ated with this project? Project Rating Criteria: Qualitatively (low, medium, high ratings) and/or quantitatively (numerical ratings such as "100, 50, 30" or "1 to 10") to prioritize, rank or rate the proj- Compelling Practice #7 Project Rating and Prioritization The Port Authority of New York and New Jersey (PANYNJ) Aviation collaborative project rating process is conducted by a committee of staff from the Aviation, Project Management and Engineering departments. It is a four-step process using an Excel spreadsheet that includes: 1) Rating the importance of the asset that calculates a weighted "Importance Factor" (IF); 2) Rating the condition of the asset that calculates a "Condition Index" (CI), which is the average of the life cycle and condition ratings; 3) Calculating priority and cost effectiveness factors to produce a "Priority Factor" (PF) that equals the IF times the CI, and a "Budget Effectiveness Factor" (BEF) that takes into account the total project cost minus the cost recovery; and 4) Prioritizing the projects based on their "Priority Factor" and "Budget Effec- tiveness" Ratio. The process uses weighted rating scales from 1 to 5 in criteria categories that include the 1) Importance of the asset, including life safety, operational impact, customer service impact, and revenue impact in step one above and 2) Condition of the asset, including life cycle criteria, condition criteria, service- ability, level of maintenance required and maintainability in step two above.

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The Nuts and Bolts: Development and Implementation 41 ects in the Project Request List using operational, financial, technical, environmental, and risk criteria. This will facilitate difficult decision making when funding becomes con- strained or limited. Prioritize Projects: Analyze, evaluate and prioritize the projects on the Project Request List. Financial Modeling: Run financial models of various project and funding scenarios. This is an iterative process, so the model should be rerun each time a scenario changes. Operating Budget Impact Analysis: Determine the overall impact each ACP scenario will have on the operating budget and on airport rates and charges. Recalculate the impact each time the scenario is revised. Trade-Off Analysis: Conduct a trade-off analysis for all projects--choose between projects (e.g., can discretionary projects be delayed in order to afford projects that address other urgent facility needs?), sequence projects according to urgency (i.e., what projects "need" to be done first?), and sequence projects according to financial impact (i.e., can the project order be rearranged to increase or decrease a financial impact within or between fiscal years?). Additional Financial Modeling: Continue to run financial models of various project and fund- ing scenarios until the airport reaches an ACP that advances the agency's goals and objectives, accommodates the priorities and initiatives set by the ACP Policy in Step 1, is affordable, and meets the financial goals or metrics defined in the agency's strategic financial plan and/or in the ACP Policy issued in Step 1. When: Programming should occur after the Financial and Capital Planning is completed and prior to vetting it with stakeholders and presenting it to the Approving Authority for approval and/or authorization. Leaders: Finance and Lead Technical Departments (See Step 2 of the Development phase for a description of a Finance Department and Step 3 of the Development phase for a description of a Lead Technical Department.) Partner: CMT Methods: The following is a list of techniques that should be used to communicate and col- laborate with Partners during this step: Collaborate with the CMT in developing prioritization factors, planning and evaluation criteria and performance indicators. Discuss the prioritized list of projects in the Project Request List. Conduct trade-off analysis. Reach consensus on the ACP to be vetted and approved in the next step. Collaborate between the two Leaders (Financial and Lead Technical Departments) to Define roles and responsibilities of each. Develop process to resolve conflict and/or disagreement. Work together to execute the tasks of this step. Communicate in meetings and in writing with the Executive Leader and Leadership Team on Prioritized Project Request List. The draft ACP. Products: The following is a list of written documents, processes, data, events, and/or other benefits that will be produced during this step: Defined roles and responsibilities for Step Leaders. List of formalized, comprehensive prioritization factors. Prioritized Project Request List.