Contracting Fixed-Route Bus Transit Service (2018)

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82 TCRP Project J-7, Synthesis Topic SG-15 Contracting Fixed-Route Bus Transit Service Project purpose: Most of the literature on contracting focuses on cost benefit analyses. The purposes of this synthesis are to examine the process of procurement and oversight to ensure quality fixed-route bus transit services and to provide summary information and case examples that can be used by transit systems in their decision making process. What constitutes a “good” RFP/procurement process? What are the pitfalls that can occur in the contracting experience and how can these be avoided or resolved? The study will answer these questions by identifying successful strategies and best-practice solutions. The survey questions try to address as many situations as possible, but given the variety of circumstances and transit systems, not all questions may be appropriate for all agencies. We encourage you to obtain input from others in your agency as needed. If any question does not apply to your system, simply answer “N/A.” We also ask for recommendations for other agencies to be included in our sample and for your willingness to participate in a telephone interview if your agency is selected for a more detailed case example. The final report, to be published by the Transportation Research Board, will summarize best practices in contracting fixed-route bus transit service. This report will be extremely useful to all transit agencies in assessing current policies and identifying approaches that have been success- ful elsewhere. All survey responses will be confidential. Thank you for taking the time to participate. Instructions on returning the survey are included on the last page. A p p e n d i x C Transit Agency Survey

Transit Agency Survey 83 Respondent Information 1. Date: 2. Name of Respondent: 3. Agency Name: Title of Respondent: City/State: Respondent e-mail address: Respondent Telephone Number: 4. How many buses does your agency operate in maximum service? 5. What is the government structure of your agency? Independent authority City department County department Regional agency but not an independent authority Other (please specify) I. CONTRACTING BUS SERVICE 6. What percentage of fixed-route bus transit service does your agency contract out? 100% 50% to 99% 25% to 49% Less than 25% 7. How long has your agency contracted for fixed-route bus service? Over 10 years 5 to 10 years 2 to 4 years Less than 2 years 8. What are the reasons that your agency chooses to contract for fixed-route bus service? (Check all that apply) Minimize operating cost Improve cost efficiency Improve labor productivity

84 Contracting Fixed-Route Bus Transit Service Take advantage of greater expertise provided by contractors Mandated by the Board or other local/state governing body Minimize size of agency staff Foster competition Improve service quality Other (please specify) II. CHALLENGES 9. Please characterize the following elements as major challenges, minor challenges, or not an issue in contracting fixed-route bus service. Major Challenge Minor Challenge Not an Issue Staff expertise in contracting Size of agency staff Familiarity with procurement process Lack of experience in RFP preparation Elements to contract Ability to attract competing bids Underbidding by bidders Evaluation criteria Workforce retention Loss of control over service Need for oversight Service quality Service integration Disputes with contractor Customer satisfaction Other (please specify) 10. Please describe the one major challenge in contracting fixed-route bus service and strategies or tactics used to overcome this challenge. III. ASSESSMENT/LESSONS LEARNED 11. How would your agency rate its efforts to contract fixed-route bus service? Very successful Somewhat successful Neutral Somewhat unsuccessful

Transit Agency Survey 85 Very unsuccessful Other (please specify) 12. What have been the primary benefits of contracting? 13. What have been the primary drawbacks of contracting? 14. What was the most successful action taken, and why? 15. If you could change ONE aspect in the contracting process that your agency used, what would you change? 16. Please describe any “lessons learned” that would benefit other transit agencies. IV. PROCUREMENT FRAMEWORK 17. How does your agency develop its Request for Proposals for fixed-route contracting services? (Check all that apply) Standard RFP template used with specific scope inserted New from scratch RFP Based on RFPs from similar transit agencies Developed by a consultant Other (please specify)

86 Contracting Fixed-Route Bus Transit Service 18. What elements does your agency include in a contracting RFP? (Check all that apply) Description of bus service (number of routes/span of service) Description of vehicles and facilities Technical proposal requirements Minimum contractor qualifications Evaluation criteria Detailed description of contractor responsibilities Detailed personnel requirements Description of performance incentives and liquidated damages provisions Expected price range FTA clauses Other (please specify) 19. How is the RFP publicized? (Check all that apply) Local print media National transit publications (e.g., Passenger Transport) General on-line media Transit-specific on-line media Agency or government website Other (please specify) 20. How are proposals evaluated? Please indicate the relative weight given to each component. Experience and references ___% Thoroughness of implementation plan ___% Technical capacity of contractor ___% Financial capacity of contractor ___% Price ___% DBE participation ___% Other (please list below) ___% 21. Did your agency develop an Independent Government Estimate (IGE) of the expected cost of the contract? Yes No (go to Question 22) Unsure (go to Question 22) 22. Briefly describe how your agency developed its IGE.

Transit Agency Survey 87 23. Has your agency ever experienced issues with the realism of cost proposals for contracting bus service (i.e., unrealistically low bids)? Yes No (go to Question 24) Unsure (go to Question 24) 24. Please describe how your agency addressed issues with the realism of cost proposals. 25. How many bids did you receive for your agency’s most recent fixed-route bus service contract? One Two Three Four More than four 26. Has the number of bidders changed over the years? Yes, number of bidders has increased Yes, number of bidders has decreased No change Unsure This is the agency’s first contract 27. Are the services provided under your most recent fixed-route bus service contract: Replacing services directly operated by our agency Replacing or extending contracted services New services A combination of the above 28. Has your agency received any protests in recent fixed-route bus service procurements? Yes No Not for the most recent procurement; unsure about past procurements V. CONTRACT/OPERATING AGREEMENT STRUCTURE 29. What is the length in years of the initial term of award? One year Two years Three years Four years Five years More than five years 30. Does the contract have an option to extend the award? Yes No (go to Question 31)

88 Contracting Fixed-Route Bus Transit Service 31. How many years are included in the option? One year Up to two years Up to three years Up to more than three years 32. What is the payment basis for your agency’s current fixed-route contract? (Check all that apply) Cost plus fixed fee Revenue miles Revenue hours Passengers Total vehicle miles Total vehicle hours Fuel costs reimbursed separately Other (please specify) 33. How does your agency handle fare revenues under the current contract? Fare revenues given to agency Fare revenues kept by contractor Direct offset to cost Other (please specify) 34. Does the current contract include contractor performance provisions (incentives, penalties, or liquidated damages)? Yes No (go to Question 38) 35. What contractor performance provisions are included in the contract? (Check all that apply) Performance incentives Liquidated damages Performance penalties but not liquidated damages Other (please specify) 36. What are the percentage or dollar amounts of the incentives or penalties? 37. In your agency’s experience, does inclusion of liquidated damages or performance penalties increase the cost of the proposals received? Yes No Unsure

Transit Agency Survey 89 39. Who provides the buses under this contract? Transit agency Contractor Transit agency, but contractor provides emergency spares Other (please specify) 40. What equipment/facilities are provided by the contractor? Non-revenue/support vehicles Bus storage facilities Bus maintenance facilities Bus maintenance equipment Scheduling software None – all provided by transit agency Other (please specify) VI. TRANSITION ISSUES 41. Has your agency changed contractors within the past three years? Yes No (GO TO Question 44) 42. Please characterize the transition. Smooth transition – no issues (GO TO Question 44) Acceptable transition – a few minor problems easily resolved Difficult transition – major problems and/or many minor problems 43. What were the nature of the transition problems? Check all that apply. Labor Equipment Facility Pensions Other financial 38. Has your agency ever assessed liquidated damages under the current contract? Yes, more than three times Yes, three times or less No Unsure Retention of records General lack of cooperation between old and new contractor Other (please describe)

90 Contracting Fixed-Route Bus Transit Service 44. Please describe the most serious transition problem and how it was resolved. VII. LABOR ISSUES 45. Has your agency experienced any labor issues related to contracting? Yes No (GO TO Question 47) Unsure (GO TO Question 47) 46. Please describe the nature of the labor issues. Continuity of employment Employees right of first refusal Wage levels Benefit levels Pensions Collective bargaining agreements Work requirements (length of shifts, work hours, etc.) Other (please describe) 47. Please describe the most serious labor issue and how it was resolved. 48. Has your agency ever had to respond to a Section 13c complaint? Yes, in response to a formal 13c complaint Yes, not to a formal complaint but in response to Section 13c issues raised during negotiations. No VIII. OVERSIGHT 49. Does your agency monitor contracted services? Yes No (GO TO Question 52) 50. Please check all the areas that you monitor. (Check all that apply) Workers comp and related administration costs Liability costs and related administration costs Maintenance Depreciation of operating facilities Accounts payable and payroll Cash counting and fare box maintenance

Transit Agency Survey 91 Human resources and recruiting costs Contract administration Third party vehicle inspection Internal audit Driver training Verification of NTD and other data Street supervision Dispatch Background checks Drug and alcohol testing Operations department management Operator training and safety Other Areas (please specify) 51. Does your agency have a specific unit or specific staff members with the responsibility of monitoring the performance of fixed-route contracted services? Yes, a specific unit Yes, specific staff members but not a specific unit No (GO TO Question 52) 52. How many agency employees (in full-time equivalents) are involved in contractor oversight? Less than one FTE One but less than two FTE Two but less than three FTE Three or more FTE 53. How frequently does your agency communicate with your contractor? Daily Several days a week Weekly Two or three times a month Monthly Other (please specify) 54. How would you rate the quality of communication with the contractor? Very good Good Fair Poor Very poor Depends on the contractor

92 Contracting Fixed-Route Bus Transit Service 55. Who has responsibility for collecting operating data, including NTD data? Contractor Transit agency Other (please specify) 56. How often is operating/NTD data reported for contracted services? Daily Weekly Monthly Annually Other (please specify) 57. Is the operating/NTD data publicly available? Yes (GO TO Question 58) Some is, some is not No (GO TO Question 59) 58. Please describe the type of data that is publicly available. 59. How is the data made available to the public? (Check all that apply) Periodic posting of performance reports on the agency website Printed reports that are available to anyone on request In response to information requests under local public records law Other (please specify) 60. Are there issues with fixed-route service integration (either between directly operated and contracted service or between different contractors)? Yes, there are ongoing issues Yes, there are occasional issues No A single contractor operates all of our fixed-route service 61. How does your agency resolve disputes with its contractor? Check all that apply Discussed and resolved at regular meetings Discussed and resolved at ad hoc meetings addressing specific issues Performance penalties/liquidated damages assessed Other (please specify)

Transit Agency Survey 93 62. How does your agency evaluate service performance for contracted fixed-route service? Agency-wide performance standards Performance standards for contracted service Customer feedback via surveys Customer feedback informally Qualitatively Other (please specify) 63. What is the most important issue regarding agency oversight and how is this addressed? SUMMARY/CASE EXAMPLE 64. Is there any other information that you would like to share that could benefit other transit systems that contract fixed-route service? 65. Would you be willing to participate further as a case example, involving a telephone interview going into further detail on your agency’s experience, if selected by the TCRP panel for this project? Yes No 66. Is there another transit system that you suggest we include in this synthesis project? Please provide the agency name and a contact (if known). Thank you!