The National Academies Press

Currently Skimming:

Pages 50-66

The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.

From page 50... ... 50 C H A P T E R 6 Introduction In Chapter 5, the research team described how an airport might screen and select projects that are most suitable for alternative project delivery. Next, the team explained how to determine if a project would be commercially and financially feasible to be delivered through alternative methods through a series of studies and engagement with the private sector. Read the entire page →
From page 51... ... Structuring the Procurement Process 51 • Discuss how to assess project risks and allocate those risks so that procurement documents accurately designate the roles and responsibilities of the airport owner and developer. • Describe the procurement documents that are necessary to solicit a developer. Read the entire page →
From page 52... ... 52 Evaluating and Implementing Airport Privatization and Public-Private Partnerships Another part of a market sounding exercise is an RFI process. This process can provide feedback from the market before a procurement is launched regarding a project's constructability, bankability, procurement process, and risks. Read the entire page →
From page 53... ... Structuring the Procurement Process 53 in public asset operation and privatization (Ernico et al., 2012) Read the entire page →
From page 54... ... 54 Evaluating and Implementing Airport Privatization and Public-Private Partnerships preselected criteria. A two-step procurement method involves the selection of a developer using price and other key factors, such as qualifications and technical approach. Read the entire page →
From page 55... ... Structuring the Procurement Process 55 on integrated design and construction phases, the airport may design the method of payment to further drive contractual efficiencies and compel the developer to help the airport owner realize the project's goals. In a P3 agreement, the payment method can assist the airport in reaching specific goals, such as containing costs, benefiting from potential savings, and accelerating schedule and delivery. Read the entire page →
From page 56... ... 56 Evaluating and Implementing Airport Privatization and Public-Private Partnerships availability payment) and typically do not stand alone as a means to compensate the developer. Read the entire page →
From page 57... ... Structuring the Procurement Process 57 First, it is helpful to visualize who is involved in drafting the procurement documents used in procurement as well as those engaged in procurement itself. Each airport has a unique procurement process that is informed by its regulatory and statutory environment. Read the entire page →
From page 58... ... 58 Evaluating and Implementing Airport Privatization and Public-Private Partnerships Public Officials (i.e., City Council, Airport Board) Project Owner (Airport) Read the entire page →
From page 59... ... Structuring the Procurement Process 59 to accommodate no fewer than 100 aircraft on the taxiways and apron at a time. In contrast, a prescriptive specification may state that the airport must have a set of parallel runways, interconnected by 20 taxiways and two terminal facilities. Read the entire page →
From page 60... ... 60 Evaluating and Implementing Airport Privatization and Public-Private Partnerships the RFP instead of a completed design. Airport owners may be reluctant to relinquish significant control over the project. Read the entire page →
From page 61... ... Structuring the Procurement Process 61 has focused on risk assessment that occurs during the project feasibility phase. Efficient risk management involves assessing the cost of risks transferred to the private party and to the airport, reducing overall cost, and generating VfM (discussed further in the guidebook) Read the entire page →
From page 62... ... 62 Evaluating and Implementing Airport Privatization and Public-Private Partnerships would do this by first creating a high-level risk matrix focused on connecting identified risks and losses to project delivery types. This would help an owner identify risks specific to its project's operating environment that require tailored contractual treatment versus risks that are typically transferred and suitable for treatment via best practice. Read the entire page →
From page 63... ... Structuring the Procurement Process 63 One of the causes for P3s ending in termination or not reaching financial close is when airport owners attempt to push too much risk (or the wrong risk) to the private sector. Read the entire page →
From page 64... ... 64 Evaluating and Implementing Airport Privatization and Public-Private Partnerships • Ensure each discipline (e.g., engineering, operations, finance, asset management, and so forth) is included in the process to avoid omitting or misevaluating risks. Read the entire page →
From page 65... ... Structuring the Procurement Process 65 Risk Description + Root Cause Mitigation Strategy Risk Responsibility Explanation Permit or approval delays from the Owner and third-party agencies, and utilities causing delays to the project Recognizing importance of stakeholder buy-in, having developer experience with obtaining these approvals Shared -- Owner is responsible for delays in their approval process (constituting a delay event) ; developer for contractor delays Labor unrest in local unions, potentially resulting in union strikes and, consequently, work shutdown Developer experience with regional labor; attempt for nostrike clause in labor agreement Developer -- Strike or labor dispute is NOT force majeure; developer's risk Delays, cost overruns, or developer impropriety that results in management, operations, or construction-related failures, thereby causing public relations issues Control public perception; schedule will deliver project ahead of airport owner's anticipated completion date; developer organization chart has ethics, safety, quality, and compliance officers directly reporting to project executives Developer -- Standard risk allocation Fires, hurricane-force winds, tornadoes, floods, tsunami, named windstorms, or snow or ice storms that are not ordinarily encountered at LaGuardia Airport; event causing state of emergency that impacts project safety, loss of work in place and delay (force majeure) Read the entire page →
From page 66... ... 66 Evaluating and Implementing Airport Privatization and Public-Private Partnerships project identified in the unsolicited proposal, which often includes allowing other interested entities to submit proposals in response to a scope that the agency develops using the unsolicited proposal as a guidebook. In jurisdictions in which unsolicited proposals are an option, airport authorities may find them to be useful in developing projects. Read the entire page →

From page 50...

... 50 C H A P T E R 6 Introduction In Chapter 5, the research team described how an airport might screen and select projects that are most suitable for alternative project delivery. Next, the team explained how to determine if a project would be commercially and financially feasible to be delivered through alternative methods through a series of studies and engagement with the private sector.