Finance Committee October 18, 2011

Transcription

1 Finance Committee October 18, 2011 Finance Committee: Commissioners Mar (Chair), Elsbernd (Vice Chair), Cohen, Farrell, Kim and Mirkarimi (Ex Officio) Leroy Saage Deputy Director for Capital Projects José Luis Moscovich Executive Director Recommend Authorizing the Executive Director to Enter into Funding Agreements for Phase II of the Presidio Parkway Project with the California Department of Transportation and the Golden Gate Bridge, Highway and Transportation District and to Negotiate Agreement Terms and Conditions The Authority has been leading the effort in close cooperation with the California Department of Transportation (Caltrans) to replace the existing Doyle Drive structure. Construction of the Presidio Parkway project to replace Doyle Drive is organized into two phases. Phase I is being delivered under a traditional design-bid-build process and Phase II is being delivered as a public-private partnership (P3). In November 2008, the Authority entered into a Memorandum of Understanding (MOU) with the Metropolitan Transportation Commission (MTC) and the Golden Gate Bridge, Highway and Transportation District that identified sources and amounts of funding for the Presidio Parkway. In order to provide documentation to support financial close of Phase II of the project, funding agreements are required that more specifically identify when funds are to be provided and funds sources. For instance, the Authority must enter into a cooperative agreement with Caltrans that codifies the commitments to secure funds as shown in Attachment 2, conditional upon the controlling agency taking necessary action to make the funds available. The Authority s direct contribution to the project remains at $171,773,000 (Resolution 11-47, approved March 29, 2011). We are seeking a recommendation authorizing the Executive Director to enter into funding agreements for the Presidio Parkway project with the California Department of Transportation and the Golden Gate Bridge, Highway and Transportation District and to negotiate agreement terms and conditions. Doyle Drive serves as the South Access to the Golden Gate Bridge and is part of US-101 that provides a crucial regional link between the City and County of San Francisco and North Bay Area counties. The Authority has been leading the effort since 1994, in close cooperation with the California Department of Transportation (Caltrans), to replace the existing Doyle Drive structure. The Authority has forged a partnership with a host of federal, state and local agencies involved with this complex undertaking. These agencies include the Federal Highway Administration (FHWA), Presidio Trust, Department of Veterans Affairs, National Park Service, Caltrans, Golden Gate Bridge, Highway and Transportation District (GGBHTD or Bridge District), Transportation Authority of Marin (TAM), Sonoma County Transportation Authority (SCTA), State Historic Preservation Office and others. Construction of the Presidio Parkway project to replace Doyle Drive is organized into two phases. Phase I is being delivered under a traditional design-bid-build process consisting of contracts 1 through 4 for environmental mitigation, utility relocation, and the construction of portions of the permanent new parkway, one of four short tunnels under the Presidio, and a detour. Once Phase I is complete,

2 expected in early 2012, traffic can be shifted away from the old facility allowing its removal and for construction of Phase II. Phase II includes construction of a new northbound bridge and Battery Tunnel, the Main Post Tunnels, and the Doyle Drive/Girard Road/Marina Boulevard/Richardson Avenue interchange as well as final landscaping. Phase II is to be delivered under a public-private partnership agreement (P3). Both phases of the new facility are now expected to be open by June In 2010, the California Transportation Commission (CTC) approved Phase II of the Presidio Parkway project s implementation through a P3 agreement, making it the first transportation project in California to be delivered in this manner under the authority of Senate Bill X2 4. On January 3, 2011, with concurrence from the Authority, Caltrans awarded the P3 agreement to the selected bidder, Golden Link Concessionaire (GLC). In November 2008, the Authority entered into a MOU with the Metropolitan Transportation Commission (MTC), and the Bridge District that identified sources and amounts of funding for the Presidio Parkway. The Authority s commitment under the MOU totals $171,773,000. This is comprised of $115,891,915 in State Regional Improvement Program (RIP) and $55,881,085 in Prop K funds (Resolution 12-12, approved September 27, 2011). The MOU also included a commitment of $80 million in bridge tolls from MTC, $75 million from the Bridge District and a total of $5 million from Sonoma and Marin Counties. (The Bridge District s contribution would be increased to not more than $80 million should Sonoma or Marin Counties elect to make contributions to the Bridge District for other projects in lieu of direct contributions to the Presidio Parkway). In order to provide documentation to support financial close of Phase II of the Project, funding agreements are required that more specifically identify when funds are to be provided and fund sources. The purpose of this memorandum is to seek a recommendation authorizing the Executive Director to enter into funding agreements for the Presidio Parkway project with Caltrans the Bridge District and to negotiate agreement terms and conditions. Phase II of the Presidio Parkway is budgeted at approximately $1.4 billion in year-of-expenditure dollars. This amount includes construction cost as well as financing and operations, maintenance and renewal over the 30-year P3 concession period. Caltrans has calculated, and we have confirmed, that the life cycle cost of the project as delivered under P3 is actually lower than it would have been under a traditional design-bid-build delivery process. The Authority s total direct funding commitment to the Presidio Parkway remains unchanged at $171,773,000. Existing funding commitments were codified in the MOU signed in November 2008 between the Authority, MTC, and GGBHTD (Resolution 09-18, approved November 2008). The Presidio Parkway project has a very complicated funding plan comprised of more than 15 different federal, state, regional, and local sources. This, plus the acceleration of the project schedule made possible by the receipt of American Recovery and Reinvestment Act funds, have necessitated that Caltrans and the Authority continually monitor the funding plan to optimize factors such as eligibility, timing of availability of funds, number of fund sources applied to any one contract, etc. The funding plan will necessarily evolve over time as we work together to ensure that the cash flow needs of the project are met. Over the past decade plus, the Authority has

3 worked collaboratively with Caltrans to advance the Presidio Parkway project, including securing funding from federal, state, regional, and local sources. All of the funding for Phase 1, shown in Attachment 1, has been secured. As public partners in the P3 agreement, both Caltrans and the Authority must commit to securing, or working to secure, the funds detailed in the P3 financial agreement. Attachment 2 shows the funding summary for Phase II, indicating which agency (i.e. Caltrans or the Authority) is assigned to secure each of the fund sources contributing to Phase II of the project. Caltrans s commitment includes the bulk of the federal and state funds, and the Authority s commitment includes Prop K, RIP (which are programmed by the Authority and then allocated by the CTC), and the funds committed to the project by the Bridge District, TAM, and SCTA through the aforementioned MOU. In order to provide the documentation necessary to achieve financial close of Phase II of the Project, the Authority must also enter into a cooperative agreement with Caltrans that codifies the commitments to secure funds as shown in Attachment 2, conditional upon the controlling agency taking necessary action to make the funds available. The Authority must also enter into agreements with other local agencies that have committed funds to Phase II of the project. As allowed under the 2008 MOU, TAM and SCTA have indicated intent to make contributions to the Bridge District in lieu of making contributions directly to the Presidio Parkway. At this time, therefore, it is only necessary for the Authority to enter into a local funding agreement with the Bridge District to clarify roles and responsibilities and specify the timing, fund source, and other particulars of that agency s commitments. With more than ten contributing fund sources, the Phase II funding plan remains unusually complex, and will continue to evolve as we work with our partner funding and implementation agencies to address unanticipated issues that arise with respect to timing, eligibility, and other similar concerns. The proposed funding agreements with Caltrans and the Bridge District reflect all of our agencies commitment to resolve any outstanding issues to ensure delivery of the funds to support Phase II as promised. We are seeking a recommendation authorizing the Executive Director to enter into funding agreements for the Presidio Parkway project with the California Department of Transportation and the Golden Gate Bridge, Highway and Transportation District and to negotiate agreement terms and conditions. 1. Recommend authorizing the Executive Director to enter into funding agreements for the Presidio Parkway project with the California Department of Transportation and the Golden Gate Bridge, Highway and Transportation District and to negotiate agreement terms and conditions. 2. Recommend authorizing the Executive Director to enter into funding agreements for the Presidio Parkway project with the California Department of Transportation the Golden Gate Bridge, Highway and Transportation District and to negotiate agreement terms and conditions with modifications. 3. Defer action, pending additional information or further staff analysis. The CAC was briefed on this item at its January 26, 2011 meeting, and unanimously adopted a motion of support for the staff recommendation.

4 Execution of the funding agreement with Caltrans would make the Authority responsible for securing the locally controlled funds, contingent upon the controlling agency shown taking necessary action to make the funds available, as shown in Attachment 2. Depending on the fund source and on the use of the funds, they will be included in future year Authority budgets, as appropriate. Execution of the funding agreement with the Bridge District will allow the Authority to accept payment of up to $80 million for use on the Presidio Parkway project. Authorize the Executive Director to enter into funding agreements for the Presidio Parkway project with the California Department of Transportation and the Golden Gate Bridge, Highway and Transportation District and to negotiate agreement terms and conditions. Attachments: 1. Presidio Parkway Project Funding Summary Phase I 2. Draft Presidio Parkway Project Funding Summary Phase II

5 Attachment 1 Presidio Parkway Project Funding Summary Phase I Fund Source 1 Type of Funds Amount 2 PLH Federal $23,570,000 HPP Federal $12,580,000 UPP Federal $27,300,000 ARRA SHOPP State $83,280,000 SHOPP State $180,890,000 TCRP State $14,490,000 Prop K Local $32,314,596 RIP (San Francisco) Local $16,870,000 BATA/MTC Local $80,000,000 Total $471,294,596 1 Acronyms used in this column include: ARRA - American Recovery and Reinvestment Act, BATA Bay Area Toll Authority, HPP High Priority Projects, MTC Metropolitan Transportation Commission, PLH - Public Land Highway, RIP - Regional Improvement Program, SHOPP - State Highway Operation and Protection Program, and UPP Urban Partnership Program 2 All funds have been secured for Phase I of the project.

6 Attachment 2 Draft Presidio Parkway Project Funding Summary Phase II Includes Construction Costs and Availability Payments 1 Funds to be Secured by State: Source 1 Controlling Agency Amount ($YOE) 1 ARRA TIGER Federal $46,000,000 SHOPP State $62,510,000 State Highway Account (Non-SHOPP) State $1,131,000,000 TOTAL AMOUNT TO BE SECURED BY STATE $1,239,510,000 Timing 2012/ /13 Fiscal Year 2013/14 through end of concession Funds to be Secured by Authority: Source 1 Programmed RIP (San Francisco) 2 Future RIP (San Francisco) 2 Controlling Amount Agency 1 ($YOE) 1 Authority, CTC $54,000,000 Authority, CTC $44,791,000 Prop K Authority $23,516,941 GGBHTD GGBHTD $75,000,000 Programmed RIP (Marin) 2 TAM, CTC $4,000,000 Sonoma County (source TBD) SCTA $1,000,000 Timing 2014/ /18 Fiscal Year 2012/13 Other Local Funding 3 Authority $26,000,000 TOTAL AMOUNT TO BE SECURED BY AUTHORITY $228,307,941 1 Acronyms used in this column include: ARRA - American Recovery and Reinvestment Act, CTC California Transportation Commission, GGBHTD - Golden Gate Bridge, Highway, and Transit District, RIP - Regional Improvement Program, SCTA Sonoma County Transportation Authority, SHOPP - State Highway Operation and Protection Program, TAM Transportation Authority of Marin, TBD to be determined, TIGER - Transportation Investment Generating Economic Recovery, YOE Year of Expenditure 2 RIP funds may be allocated directly to State by CTC and therefore RIP funds may not be budgeted and appropriated in Authority s annual budget. 3 Contingent upon funds being made available to Authority by MTC or other agency. These funds replace $26 million in re-directed earmarks that were included in the Memorandum of Understanding with MTC and GGBHTD, but which are unlikely to materialize.