Part I. Capital Programs Office Report: Capital Spending Update Part II. Transforming Capital Delivery September 12, 2016

Transcription

1 Part I. Capital Programs Office Report: Capital Spending Update Part II. Transforming Capital Delivery September 12, 2016

2 Table of Contents 1) Capital Programs Office Report: Capital Spending Update 2) Transforming Capital Delivery 2

3 Overview Improving capital delivery is critical Capital delivery is vital to MBTA operations, service improvement and MBTA commitment to our customers FY 2017 FY 2021 CIP is different from previous CIPs o Improved focus and alignment on needs and priorities o Underdeveloped in terms of cashflows and deliverability Capital spending must more than double to achieve CIP spending levels o Actual spending FY 2012 FY 2016 was $3 billion o CIP programs $6.5 billion for FY STRATEGY PIPELINE $SPEND Priority Setting & Funding Availability (5-year CIP) Project Development (need, scope, budget and schedule) Delivery (design, plan of finance, procurement, construction/ manufacture) 3

4 Overview 1. Problems have been chronicled from Governor s Special Panel Assessment of MBTA April 2015 Unsustainable Operating Budget Lack of Accountability Chronic Capital Underinvestment Flawed Contracting Processes Bottlenecked Project Delivery Lack of Customer Focus Ineffective Workplace Practices Shortsighted Expansion Program Organizational Instability 4

5 Overview 2. Problems have been chronicled Ascent PGM Assessment Summer Capital delivery has historically not been a strategic imperative 2. Project development and budgeting processes inhibit effective program execution 3. Lack of data and a system of controls hinders effective decision-making 4. Cultural change is critical to the Capital Delivery transformation 5

6 Part I: Capital Spending Update 6

7 Capital Programs Report Delivering FY 17 CIP: Spending forecast of $850M-$950M Started with FY CIP priorities FY CIP projects an average annual spend of ~$1.3B Conducted a 30-day initial review of project spend plans based on input from each of the Authority s 32 Program Directors and 70 Project Managers and follow-up meetings with the Program Directors Developed a FY 2017 delivery and spend forecast of $850M - $950M, organized by programs and projects 7

8 Capital Programs Report FY 2017 projected spend is 21% increase over FY 2016 MBTA Capital Spending 8

9 Capital Programs Report FY 2017 forecasted spending on top CIP priorities reliability and modernization approximately 59% higher than prior year actual spending ~$850M-$950M 59% 9

10 Capital Programs Report FY 2017 YTD spending significantly lags both FY 2017 forecast and FY 2016 YTD (through August) Average Weekly Capital Spend (YTD Aug - 2 months) FY 2016 FY 2017 $16.9M $8.3M $135.2M YTD Aug 2015 (FY16-2 months) $66.6M YTD Aug 2016 (FY17-2 months) $22.5 M of spending variance due to lower spending on GLX 10

11 Capital Programs Report FY17 Projected vehicle department spend represents ~50% of overall projected spend and ramps up later in the year *Includes Revenue Vehicles program, R/O vehicles, and Green Line Type 9 vehicles. 11

12 FY 2017 CIP vs. FY 2017 Forecast Top 10 Programs represent 86% of FY 2017 forecast Top Projects (Program) FY 2016 Spending (ACTUAL) FY17 Forecast* (CURRENT) Accelerators R/O Line Infrastructure / Vehicles $46.0 $115.9 Positive Train Control** Functional Programs (SGR) Revenue Vehicles $121.9 $349.3 Bridge Winter Resiliency (Phase I & 2)*** Power Station Improvements Signals Expansion GLX $180.1 $80.3 Fitchburg Line Commuter Rail Top Programs Total $493.7 $770.4 Grand Total $743.0 $900.0 *Represents mid-point of range ($850M-$950M) **Payments only; does not include $58M of earned value ***Winter Resiliency does not include funding from operating budget. 12

13 Part 2: Transforming MBTA Capital Delivery 13

14 Transforming Capital Delivery Overview Objective: Transform capital delivery to achieve CIP (from $3B delivery in the last 5 years to $6.5B delivery in coming 5-years aligned with need and strategy) Recommendations: 1. Organization and capacity Develop organizational capability and structure to better integrate capital delivery and operations 2. Capital program management and controls Strengthen capital program management & controls 3. Streamline procurement and funding 4. Program acceleration Establish an integrated program focus on 2-3 transformation accelerator programs 14

15 Transforming Capital Delivery Short-term and Mid-term Initiatives Initiatives Short-term Mid-term Organization & Capacity Deliverable CIP/ Develop pipeline Create executive level Capital Program Office (complete) Establish a capital development coordination committee (underway) Recruit critical capital delivery leaders and staff (underway) FY 17 CIP Scrub (complete) Remove funding and financing bottlenecks (underway) Shorten procurement process (underway) Fund additional projects through pay go capital (underway) Develop a pipeline of future projects in line with CIP Bring all capital delivery together to align with maintenance and operations Strengthen development process for FY 18 CIP Explore alternative procurement methods Capital Program Management & Controls Track all projects through interim portfolio monthly reporting (underway) Convert tracking and reporting approach from funds-based to project-based (underway) Program Focus Accelerate transformation through focus on top programs (PTC, R/O line) (underway) Create cross-functional teams with culture of accountability (underway) Plan, budget and implement an integrated PMIS Develop portfolio wide controls team Set outcome-based goals and key performance indicators Roll out to other programs in portfolio 15

16 Transforming Capital Delivery 1. Organization and Capacity Objective: Capable organization with capacity to deliver capital and improve integration with operations. Steps: 1. Create an executive level Capital Programs Office with oversight of capital delivery as a whole (underway) 2. Create a Capital Development Coordination Committee to support the CIP, capital pipeline development and prioritizing capital delivery (underway) 3. Create an Infrastructure Group responsible for all capital delivery (currently in three separate areas D&C, E&M and Railroad Ops) (underway) 4. Expand project controls to cover the full capital program (currently only covers D&C with separate Vehicle Engineering controls) 5. Recruit leadership to each area (underway) 6. Staff up according to capital delivery demand (being planned) 16

17 Transforming Capital Delivery 2. Shorten construction procurement process Project Procurement Process Concept Planning (Variable Timeframe) Design Procurement (11-12 Month Process) Design (Variable Timeframe) Construction Procurement (7-9 Month Process) Construction (Variable Timeframe) 17

18 Transforming Capital Delivery 2. Shorten construction procurement process to no more than 3 months GOAL: Reduce Advertisement to Contractor NTP (Notice to Proceed) to no more than 3 months Current Issues: Duplicative processes, Extensions to Bid Period, Excessive time required to complete routine tasks Approach: - Eliminate duplicative processes - Hold to Stated Bid Periods - Reduce time for routine tasks - Review Bid Timelines with Construction Industry groups - Engage Capital Programs Office - Validate approach 18

19 Transforming Capital Delivery 2. Shorten construction procurement: winterization shows success is possible Construction Procurement Process SUCCESS STORY Winter Resiliency FY 2016 Actual Spending: $45.4M Winter Resiliency FY 2017 Spending Forecast: $41.4M Winter Resiliency II 6/10/16 Advertising Date 7/6/16 Bid Opening 7/25/16 FMCB Approval 7/26/16 Notice of Award 8/15/16 Contract Executed and NTP Issued 66 Days from Project Advertisement to Contractor NTP First Weekend Work on Schedule for the Weekend of 9/10 We should achieve these results on all jobs 19

20 Transforming Capital Delivery 2. Shorten construction procurement process Total of all Projects to be advertised between now and 2016 YE = $194,800,000 Test Projects Projects to be advertised between now and 2016 YE Project Name On-Call Contracting Services - Trackwork Wellington Track Expansion Tracks Rockport Commuter Rail Layover Facility Mansfield Commuter Rail Accessibility Improvements IT Data Center, 45 High Street Central Square & Harvard Station Elevators Wollaston Station Improvements Fairmount Line Blue Hill Ave. Commuter Rail Station Engineer s Estimate $15.0M $20.0M $4.2M $9.0M $3.0M $8.0M $37.0M $18.2M 20

21 Transforming Capital Delivery 2. Shorten construction procurement process Test Projects (Confirmed) Projects to be advertised between now and 2016 YE Project Name On-Call Power Replacement Elevators, Alewife Shawsheen River Bridge, Wilmington, MA Orange Line Test Track at Wellington Yard Gloucester Drawbridge Engineer s Estimate $15.0M $5.4M $2.0M $10.0M $48.0M 21

22 Transforming Capital Delivery 3. Track all projects through interim portfolio monthly reporting Expand monthly reporting to include other key project /program delivery metrics: o o o FY17 quarterly forecast spending Estimate at completion Major schedule milestones Finalize the conversion of tracking and reporting approach from fundsbased to project-based Plan, budget and implement an integrated Project Management Information System (PMIS) 22

23 Transforming Capital Delivery 4. Transformation Accelerator Programs In advance of organizational change, focus on top 2-3 programs now Programs will: o o o o o Be outcomes-based Led by cross functional teams Set a baseline scope, budget, schedule, and cashflow Provide regular reports to allow timely decision making Develop and maintain risk management programs Transformational Accelerator Programs: o o o Red / Orange Line Infrastructure and Vehicles (representing 13% of Five Year CIP) Positive Train Control (representing 7% of Five Year CIP) Third program to be selected 23

24 Transforming Capital Delivery PTC: Example Transformation Accelerator Program Integrated Leadership and Structure Steering Committee MassDOT, MBTA, Keolis & Jacobs General Manager Brian Shortsleeve Program Manager Brad Kesler Deputy Program Manager Brent Lesjak (Jacobs) Other Resources Funding / Finance Mike Abramo, Paul Brandley Legal Support Sue Cobb, Marie Breen Procurement Jerry Polcari, Beth Tetreault Government Relations Scott Bosworth Media Relations Joe Pesaturo Environmental Services Andrew Brennan Operations Interface Ryan Coholan Delphine Picard (Keolis) Public Outreach Rose Yates Joe Nolan (CPP) Project Management & Controls Maribel Kelly Mike Hurley (Jacobs) Design Oversight & Approvals Dave Diaz (LTK) John Mitchell (Keolis) System Integration John Mitchell (Keolis) Dan Shay (Jacobs) 24

25 Questions Questions? 25

26 BACK UP 26

27 FY 2017 Target Spend vs. FY 2017 Actual Spend Pay Go Capital FY 2017 Actual Spending also reflects need to accelerate PROJECTS/PROGRAMS FY17 Target FY17 Spending SUBWAY/ BUS 1. Beacon Junction (Green Line): Replace signal cables, flood mitigation, improved track function 2. Red, Orange, Green Line Signals System Design: Prepare signals for delivery of new vehicles 3. Bus scheduling improvement: Software that dynamic route and operator scheduling, enabling more flexible service planning effort 4. AFC 2.0 Design and consumer website: System design and performance specifications for next generation AFC; mobile platform 5. Short Term Power Investments: Sub-station replacements; 3 rd rail power supply, tunnel lighting, and emergency electrical duct bank 6. Station improvements: Leveraging schedule shut-downs to make critical station improvements 7. Unimog: Replace existing Unimog vehicle (purchased 1987) used for work on road and right of way; lower maintenance costs $2.2M $10.0M $4.7M $8.2M $10.0M $0.1M $1.2M $0.4M $0.0M $0.1M $0.3M $0.0M $0.0M $0.0M 8. Asset Management Systems $0.5M $0.0M 9. Green Line Rail Grinding $4.5M $0.0M 10. TransitMaster Server Upgrade $0.5M $0.0M COMMUTER RAIL 11. Worcester Line De-stressing: Improve existing track conditions and significantly reduce heat-related speed restrictions $3.2M $1.8M 12. Locos restoration to increase fleet size: Initial rebuild of 5 locos $3.6M $0.0M 13. Lynn Garage: Repairs to garage leased space to local community college for improved safety and state of good repair needs $6.1M $0.0M Total Budgeted Pay-Go Projects (1-13) $54.8M $2.5M 27