MIAMI DADE EXPRESSWAY AUTHORITY (MDX) FY 2018 ANNUAL BUDGET

Transcription

1 MIAMI DADE EXPRESSWAY AUTHORITY (MDX) ANNUAL ANNUAL FISCAL YEAR (FY) 2018 JULY 1, JUNE 30, 2018

2 MDX ANNUAL TABLE OF CONTENTS MEMORANDUM Appendix A Work Program & Project Expenditures ANNUAL SUMMARY ANNUAL DETAILED

3 MDX ANNUAL MEMORANDUM

4 MDX FISCAL YEAR 2018 ANNUAL The proposed Fiscal Year (FY) 2018 Annual Budget is prepared for a 12-month period, July 1, 2017 to June 30, The Annual Budget outlines both the revenues expected to be earned and expenses expected to be incurred for FY The purpose of the Annual Budget is to predict the financial position of the Authority based on the forecasted revenues and projected expenses, and ensure that all payment obligations are met. The Annual Budget authorizes the funding for the upcoming fiscal year. The Board of Directors approves the Annual Budget in advance of every fiscal year, and the actual revenues and expenses are reviewed on a monthly basis at the Budget & Finance Committee and/or the Board Meeting. Annual Budget The Annual Budget consists of three (3) components: Operating Expenses of $60.6 million, Debt Service of $99.5 million, and Capital Expenditures of $1.5 million. In addition to the Annual Budget there is the Pay as You Go funding for the Work Program via a transfer from the General Fund of $85.0 million, and monthly Flow of Funds transfers of $87.3 million. Fiscal Year 2018 Annual Budget EXISTING SERVICES NEW SERVICES Operations $ 44,080,342 $ (3,548,769) $ 2,000,000 $ 42,531, Maintenance 7,847,522 (247,610) 1,500,000 9,099, Administration 6,641,293 (682,735) - 5,958, Contingency 1,000,000 (485,000) - 515, Operating Expenses Before Litigation $ 59,569,156 $ (4,964,113) $ 3,500,000 $ 58,105, Legal Services - Litigation 250,000 2,250,000-2,500, Total Operating Expenses $ 59,819,156 $ (2,714,113) $ 3,500,000 $ 60,605, Debt Service $ 96,409,754 $ 3,051,917 $ - $ 99,461, Capital (Non-Work Program) Expenditures $ 1,856,000 $ (329,000) $ - $ 1,527, Total Fiscal Year Annual Budget $ 158,084,910 $ 8,804 $ 3,500,000 $ 161,593, The Annual Budget of $161.6 million consists of $139.9 million or 86.6 in fixed costs and $21.7 million or 13.4 in variable costs. Costs that are based on set contractual amounts are considered fixed, such as debt service, SunPass charges, insurance, contracted maintenance, majority of Traffic Management Center (TMC), Toll-By-Plate (TBP), In-Lane Open Road Tolling (ORT) and image review services, TBP Postage, most structural inspections, utilities, various Information Technology (IT) costs, and the annual external audit. Variable, or more controllable, costs include staff expenses, public outreach, periodic maintenance & enhanced safety improvements, service patrols, private mobility service, and most professional services, including litigation expenses. (Remainder of page intentionally left blank) 1

5 MDX FISCAL YEAR 2018 ANNUAL Work Program Funding The Work Program totals $1.3 billion, which includes $244.2 million for. The $244.2 million of expenditures for are funded by Pay as You Go (Net Revenues) of $87.3 million, a transfer from the General Fund of $85.0 million, and Series 2014A Bond Proceeds of $71.9 million. In addition to the $1.3 billion Work Program, there are additional projects and project phases, totaling $2.4 billion. After funding Work Program expenditures of $244.2 million, the unfunded project expenditures will total $2.8 billion. Costs Project Description (000's) Work Program $ 1,312,983 SR 112 Safety Projects 490,000 R & R FY ,253 Project Design Build/ROW 928,082 Project Final Phase West Extension 82,443 Project Design Build/ROW 615,797 Total Expenditures $ 3,712,558 Expenditures Paid Thru (655,526) Remaining Expenditures to be Funded $ 3,057,032 Funding Sources for Pay as You Go (Net Revenues) $ 87,314 Transfer from General Fund 85,000 Series 2014A Bond Proceeds 71,922 Funding Available $ 244,236 Project Expenditures Unfunded $ 2,812,796 * * See Appendix A The above table of $2.8 billion of unfunded project expenditures excludes the Connect 4 Express Project of $1.4 billion and Strategic Projects approved by the Board in. Safety projects and System preservation are considered priority projects. Within the current work program, MDX is investing in the Planning Design and Environmental (PD&E) for Project Southwest Extension, expected to be completed by December 2018, Project West Extension to HEFT final construction phase, and Project East Extension to I-95 expected to be completed by December Funding of the Work Program is consistent with the MDX s Board approved financial plan presented to the rating agencies and investors. Funding requirements for the Pay as You Go or cash funded portion of the Work Program allows MDX to continue to fund projects, manage outstanding debt levels, protect MDX s credit rating, preserve future funding capacity, and reduce the likelihood of increasing toll rates in the near term. (Remainder of page intentionally left blank) 2

6 MDX FISCAL YEAR 2018 ANNUAL Highlights Work Program of $244.2 million is expected to be funded using several sources. o $2.8 billion remains unfunded. Toll Revenue forecast is based on traffic and revenue consultant s updated forecast utilizing current rates. o No rate increase or Consumer Price Index (CPI) adjustment. The overall expense budget for Operations, Maintenance and Administration of $60.6 million, decreased by $4.9 million or 8.3 for current services, which excludes litigation and two additional new and/or enhanced services: Pilot Program - Private Mobility Service of $2.0 million, Enhanced Safety Program of $1.5 million, Litigation $2.25 million. Toll Operations budget decreased $3.0 million or 8.2. o MDX executed the CCSS agreement March 2, 2016, which is a statewide administration of electronic toll activities and is the single point of contact for all toll agencies. o Toll Operations budget is based on current contracts, however, during the CCSS is expected to be operational and savings are likely to be realized during the first partial year. Roadway Operations budget increased primarily due to a new Private Mobility Service Pilot Program of $2.0 million. Excluding the additional service, roadway operations increased by $54,000 or less than 1. Maintenance budget increased primarily due to an enhanced safety program of $1.5 million. Excluding the addition of this program, maintenance expenses decreased by $247,000 or 3.1. Administration budget decreased $683,000 or 10.3, primarily due to professional services that are task authorization driven. Debt Service interest and principal payments of $99.5 million are based on bond agreements. Significant Variances From to Budget Operating Expenses $ 59,819,156 Variance of Existing Services: Toll Operations-Lanes & Back Office (515,549) SunPass Charges (2,092,988) Other Operations-Public Outreach (640,000) Salaries, Taxes & Benefits (792,043) Other Various Expenses (438,533) Contingency (485,000) Net Decrease of Existing Services $ (4,964,113) New and Enhanced Services: Pilot Program - Private Mobility Service 2,000,000 Enhanced Safety Improvements 1,500,000 Net Increase of New and Enhanced Services: $ 3,500,000 3 Total change before Litigation $ (1,464,113) Litigation $ 2,250,000 Operating Expenses $ 60,605,043

7 MDX FISCAL YEAR 2018 ANNUAL REVENUES Toll Revenues VARIANCE Toll Revenues $ 228,714,000 $ 234,974,466 $ 6,260, (See Page 1 Budget Summary and Senior Debt Coverage) Toll revenues are reported on an accrual basis when earned. SunPass Revenues are recorded by file process date. Toll- By-Plate revenues are recorded net of an allowance for doubtful accounts. Toll Revenue Forecast The Traffic & Revenue consultant provides a forecast of revenues and transactions based on current toll rates in effect, traffic trends, anticipated growth, construction impacts, and economic factors. total estimated transactions are million: million for SunPass and 97.0 million for Toll-By-Plate. Average transactions per month are projected to range from 41.0 million to 45.0 million. forecasted toll revenue is $234.9 million, and provides for a hurricane reserve of $3.2 million. toll revenue is comprised of 84.4 SunPass and 15.6 Toll-By-Plate. Toll Revenues Roadway Qtr 1 Qtr 2 Qtr 3 Qtr 4 Total SR 112 $ 6,712,000 $ 6,579,616 $ 7,238,000 $ 7,146,000 $ 27,675,616 SR ,411,000 33,694,233 35,750,000 36,176, ,031,233 SR 874 9,817,000 9,377,493 10,360,000 10,154,000 39,708,493 SR 878 1,731,000 1,682,699 1,822,000 1,842,000 7,077,699 SR 924 4,620,000 4,688,425 5,142,000 5,031,000 19,481,425 Total Toll Revenues $ 58,291,000 $ 56,022,466 $ 60,312,000 $ 60,349,000 $ 234,974,466 Transactions Roadway Qtr 1 Qtr 2 Qtr 3 Qtr 4 Total SR ,312,000 20,044,000 20,821,000 20,533,000 80,710,000 SR ,344,000 60,651,000 60,797,000 61,455, ,247,000 SR ,063,000 30,516,000 31,743,000 31,112, ,434,000 SR 878 6,963,000 7,158,000 7,330,000 7,405,000 28,856,000 SR 924 9,264,000 9,947,000 10,306,000 10,075,000 39,592,000 Total Transactions 125,946, ,316, ,997, ,580, ,839,000 Fee & Other Revenues Fee & Other Revenues VARIANCE Fee Revenues $ 9,100,000 $ 6,695,592 $ (2,404,408) Investment Income 1,975,000 5,075,000 3,100, Lease Revenues 699, ,877 (63,873) -9.1 Total Fee & Other Revenues $ 11,774,750 $ 12,406,469 $ 631, (See Page 1 Budget Summary and Senior Debt Coverage) MDX does not charge any administration fees to Toll-By-Plate customers. Fee revenues are generated by Toll-By-Plate late fees on past due invoices, and reported on a cash basis when received. Fees are expected to decrease due to Florida Department of Transportation (FDOT) re-negotiating third party rental car agreements. Investment income for interest earned on funds and lease revenues are both reported on an accrual basis. The decrease in lease revenues is due to a tenant vacating a parcel that will not be re-leased at this time since it will be impacted by MDX Project #

8 MDX FISCAL YEAR 2018 ANNUAL 1. OPERATING EXPENSES A. OPERATIONS Toll Operations Toll Operations - Lanes & Back Office Toll-By-Plate (TBP) Billings & Customer Service Support VARIANCE Toll Operations - Lanes & Back Office Toll-by-Plate Billings & Customer Service Support $ 9,138,980 $ 8,860,426 $ (278,554) -3.0 Toll-by-Plate Postage 1,367,859 1,254,947 (112,912) -8.3 Image Review Software and Staffing 1,760,504 1,862, , In-Lane Software/Hardware Maintenance & Support 4,481,247 4,306,053 (175,194) -3.9 Toll Information Technology Systems Support & Operatio 747, ,631 (26,658) -3.6 Utilities 200, ,757 (17,989) -9.0 Traffic and Revenue Studies 140, ,000 (10,000) -7.1 Other Toll Operations Expenses 32,510 35,890 3, (See Page 2 Annual Budget 1. Operating Expenses A. Operations (i) Toll Operations) $ 17,869,136 $ 17,353,587 $ (515,549) -2.9 These expenses consist of a monthly maintenance fee based on transaction volume, along with variable costs for calls handled, invoice processing, and correspondence for the TBP billing provider. The monthly maintenance fee is based on billable transaction volume. Contractually the monthly maintenance fee is a threshold structure ranging from $310,275 to $371,000, averaging $353,535 for. The billing provider averages 93 full time equivalent positions handling calls on a daily basis, as well as customers that receive billing notifications via . This line item also covers a local Customer Service Support group with 12 customer service support staff. The budget decrease of $279,000 is based on trend analysis of actual charges and an estimate for future billings. It is anticipated that the CCSS will be operational during. MDX has budgeted for current providers and may transition to the CCSS during the year with a lower cost realized. Cost Basis Rate FY 17 FY 18 Variance Quantity Amount Quantity Amount Average Monthly Maintenance Fee $358, $ 4,300,724 - $ - Average Monthly Maintenance Fee $353, ,242,420 $ (58,304) Calls Received $ ,923 2,342, ,484 2,283,496 (59,263) Invoices Mailed $ ,380,203 1,859,112 3,177,468 1,747,607 (111,504) Invoices Held $ ,607,919 80,396 1,348,608 67,430 (12,966) Back Office Leters Mailed $ ,370 15,054 34,212 18,817 3,763 /Text Invoice $ ,363 15, ,560 25,656 9,720 Toll-By-Plate Billings $ 8,613,980 $ 8,385,426 $ (228,554) Customer Service Support $ 525,000 $ 475,000 $ (50,000) Toll-By-Plate Billings & Customer Service Support $ 9,138,980 $ 8,860,426 $ (278,554) (Remainder of page intentionally left blank) 5

9 MDX FISCAL YEAR 2018 ANNUAL Toll-by-Plate Postage Postage and printing are pass-through costs from our TBP billing provider. Billings and other notices mailed by our 3rd party vendor average 267,600 pieces on a monthly basis. The budget decrease of $113,000 is based on the estimated number of invoices to be mailed during the fiscal year. Image Review Software and Staffing # of Mailings Estimate Type Rate Cost 3,380,203 Bulk $0.40 $ 1,354,447 27,370 First Class $ ,411 Postage $ 1,367,859 3,177,464 Bulk $0.39 $ 1,239,211 34,209 First Class $ ,736 Postage $ 1,254,947 Variance $ (112,912) Image review consists of two components: automated image review software and manual review by personnel. Automated image review software is based on a fixed monthly amount and manual image review charges are billed at $0.015 per image reviewed. The manual image review vendor allocates anywhere from 150 to 250 dedicated reviewers depending on volume. Staffing and image review software are all billed on a monthly basis. The budget increase is based on a contractual rate increase for fixed costs of $39,000, and $63,000 due to an estimated 7.9 increase in the number of images to be reviewed. # of Images Estimate Rate Cost 53,333,333 $0.015 $ 800,000 57,562,749 $ ,441 Variance $ 63,441 Cost Basis Quantity Monthly Amount Software Maintenance 12 $56,522 $ 678,261 Fixed Staffing & Support Costs 12 $26, ,181 Estimated $ $71, ,441 Total Image Review & Staffing $ 1,862,883 In-Lane Software/Hardware Maintenance & Support In-Lane Software and Hardware maintenance costs are provided via lump sum contracts, and are billed monthly net of adjustments related to performance measures for all five expressways. Maintenance of Traffic (MOT) for in-lane repairs and maintenance for SR 112 and SR 836 is work order driven. MDX is responsible for the replacement costs of toll parts that are damaged due to vandalism and force majeure such as storms or lightning strikes. The budget decrease is due to expected lower toll parts purchases of $80,000 after the implementation of a system-wide lightning protection system, and lower actual charges of $95,000 from the vendors based on performance. Toll Information Technology Systems Support & Operations This line item covers maintenance and support for communications and data storage equipment, software licensing costs, cloud storage data backup services, telephone, disaster recovery plan/penetration testing, open data policy implementation, and communications and connectivity costs. The budget decrease is primarily due to IT support 6

10 MDX FISCAL YEAR 2018 ANNUAL services of $150,000 and other various expenses of $67,000, partially offset by an increase in bandwidth capacity costs of $190,000 for Metro Ethernet to support the image review process. Utilities These costs include electricity for lane equipment, toll gantries, and the SR 924 administrative building, as well as water and sewer costs, and diesel for roadside generators for the toll equipment. The budget decrease is due to lower than projected expenses for electricity as was the first full year of all new installations. Traffic & Revenue Studies Traffic & Revenue consulting services include data collection and analysis, traffic and revenue forecasting, impact analysis, financial/economic feasibility studies, recalibrating and updating the traffic and revenue models, and other services as required. Charges are task authorization driven; fewer services are expected to be required for. Other Toll Operations Expenses These costs include pass-through commercial deposit account maintenance fees and lockbox services on bank accounts managed by our 3rd party billing provider, supplies, vehicle expenses, and postage for the Customer Service Support group. The budget increase is primarily due to higher bank fees of $10,000 related to TBP, partially offset by a decrease for overnight mail and office supplies of $6,500. Toll Operations - Internal Staff Toll operations internal staff consists of seven (7) employees: one (1) director, one (1) manager, one (1) support staff, and four (4) information technology positions. Salaries, Taxes and Benefits decreased due to the elimination and/or outsourcing of three (3) positions during. Please refer to the Salaries, Taxes and Benefits section below for more detail. Other Toll Operations - Internal Staff costs include employee allocable expenses such as cell phone, emergency radio dispatch, workers compensation insurance, training, travel, and various software expenses. The budget decreased $8,000 primarily due to due to less travel required related to the CCSS implementation project. Toll Operations - SunPass Charges VARIANCE Toll Operations - Internal Staff Employee Salaries $ 1,020,754 $ 758,472 $ (262,282) Employee Taxes & Benefits 353, ,275 (83,816) Workers Compensation 2,377 1,935 (442) Field Equipment Expense 6,100 6, Training/Memberships/Travel/Conference Fees 28,390 20,334 (8,056) Software Maintenance & Support 4,787 4, (See Page 2 Annual Budget 1. Operating Expenses A. Operations (i) Toll Operations) $ 1,415,499 $ 1,061,323 $ (354,176) VARIANCE Toll Operations - SunPass Charges FDOT, Toll Operations (SunPass Processing Charges) $ 14,938,410 $ 13,031,235 $ (1,907,175) FDOT, Toll Operations (SunPass Transponder Subsidy) 1,958,000 1,772,187 (185,813) -9.5 $ 16,896,410 $ 14,803,422 $ (2,092,988) (See Page 2 Annual Budget 1. Operating Expenses A. Operations (i) Toll Operations) 7

11 MDX FISCAL YEAR 2018 ANNUAL FDOT, Toll Operations (SunPass Processing Charges) Per the Interlocal Agreement (ILA) with the FDOT, these charges include per-transaction processing costs of $0.027 and payment card fees associated with SunPass revenues. Per the ILA with FDOT, MDX pays an annual lump sum amount based on estimated volume and actual amounts are adjusted at fiscal year-end. volume is estimated to increase by 18.0 million transactions. MDX will be transitioning to the CCSS during which will impact SunPass charges. The budget is based on a partial fiscal year under the old ILA model, then transitioning to the new CCSS agreement cost model. FDOT, Toll Operations (SunPass Transponder Subsidy) Amount Transaction Processing Fees (pre-ccss) $ 2,819,934 CCSS Prepaid Account Fees 5,710,549 Payment Card Processing 4,500,752 Total Processing Charges $ 13,031,235 In order to incentivize customers to use SunPass, FDOT subsidizes $5.00 of the cost of the SunPass Mini transponder to retail providers. Per the ILA with FDOT, MDX pays an annual lump sum amount based on total state-wide SunPass transponder revenues less transponder purchase costs and is prorated based on MDX s portion of overall SunPass transactions. SunPass Transponder Subsidy methodology will be restructured under the CCSS. Roadway Operations Traffic Management Center Expenses VARIANCE Roadway Operations Traffic Management Center Expenses $ 929,427 $ 1,056,048 $ 126, Service Patrols & RISC 2,545,000 2,555,000 10, Pilot Program - Private Mobility Service - 2,000,000 2,000,000 N/A Roadway Lighting 405, ,000 25, NPDES Permits 50,000 45,000 (5,000) Roadway Operations Support Services 790, ,883 93, Intelligent Transportation Systems (ITS) Expenses 186, ,200 (73,930) (See Page 2 Annual Budget 1. Operating Expenses A. Operations (ii) Roadway Operations) $ 4,905,914 $ 7,082,131 $ 2,176, These costs include MDX s share of costs to operate the SunGuide Transportation Management Center (TMC) in partnership with FDOT, including staffing, rent paid to FDOT, and associated hardware and software maintenance and support. The TMC is a regional command center that monitors real-time traffic conditions on Miami-Dade and Monroe County roadways. A new expense this fiscal year is for software maintenance costs for the Construction Information Exchange Network (CIEN). The CIEN is an intergovernmental multi-jurisdictional collaborative effort that incorporates real-time traffic and construction information into a new application for the public. MDX contributes eleven positions to the TMC, covering 17 shifts on a weekly basis: 12-hour shifts on Monday, Tuesday, Saturday, and Sunday; and 8 hours shifts on Thursday and Friday. The budget increase is due to new CIEN software maintenance costs of $100,000 and new contract multiplier for the contracted TMC manager of approximately $25,000. 8

12 MDX FISCAL YEAR 2018 ANNUAL Service Patrols & Rapid Incident Scene Clearance Position Count Senior Shift Supervisor 1 Shift Supervisor 1 Lead Operator 1 Full Time Operator 7 Part Time Operator 1 Total 11 The MDX Road Rangers patrol each of the five (5) MDX roadways in 8 hour shifts, 24-hours a day, 7 days a week, 365 days a year. Road Ranger vehicles include motorist assistance vans, tow trucks, and a flatbed tow truck. Services are billed monthly according to the vehicle/shift counts below. The budget also includes a $20,000 estimate for Rapid Incident Scene Clearance (RISC) services, which are variable work order driven costs as needed. The increase in budget is due to expected additional repairs required to the MDX owned Dynamic Messaging Boards (DMS) mounted service patrol vehicles. Pilot Program - Private Mobility Service Roadway Daily Shifts Vehicles Weekday Van SR SR SR 874/ SR The Pilot Program Private Mobility Service is a new service with operations to begin in. MDX will seek to deploy possibly various service models including shuttles buses and pooling services using on-demand technology. These services would cover specific routes including the possible use of the Express Bus/Smart lanes being currently constructed along SR 836. Roadway Lighting These costs are strictly for the electricity to illuminate the MDX roadways. There are currently 4,515 light fixtures on MDX roadways, distributed among light poles, under decks, High Mast Light Towers, aesthetic LED lighting, and sign mounted fixtures. The budget increase of $25,000 is due to an increase in rates which occurred during. NDPES Permits These are required permit costs for MDX to be in compliance with the National Pollutant Discharge Elimination System (NPDES) program. The NPDES permit program addresses water pollution by regulating point sources that discharge pollutants to waters of the United States, and was created in 1972 by the Clean Water Act. The decrease of $5,000 is based on lower than expected permit fees. Roadway Operations Support This line item includes operations support costs for: implementation plans for strategic initiatives; traffic count database/traffic safety studies; Dedicated Short Range Communications (DSRC) application development; one (1) contracted ITS field staff position; NPDES permitting; development of a MDWASD Master Agreement; new technology research; updates to the Emergency Preparedness Plan; planning for the bus operations on MDX shoulders program; and support for ITS locate services design review. Charges are task authorization driven. The increase is primarily due to the transition of the contracted ITS field staff position from an internal staff position of $70,000 and other various support services of $24,000. 9

13 MDX FISCAL YEAR 2018 ANNUAL Description Amount Strategic Initiatives $ 285,933 Traffic Counts/Safety Studies 192,821 DSRC Application Development 177,000 ITS Field Staffing 68,640 NPDES Support 45,000 MDWASD Master Agreement 37,058 Technology Updates 26,191 Project Mgt. Emergency Prep. Plan 21,169 Bus Operations on MDX Shoulders 20,071 ITS Locate Services Support 10,000 Total $ 883,883 Intelligent Transportation Systems Expenses These costs include ITS locate services to identify utility lines in anticipation of external agency projects, utility costs for ITS facilities, ITS maintenance of traffic, and replacement parts for the ITS system. This decrease is primarily due to lower ITS parts expense of $50,000 due to the purchase in of equipment needed for the DSRC and Bluetooth ITS initiatives, and lower ITS locates expense of $20,000 due to tasks being shifted to internal staff. Roadway Operations - Internal Staff Roadway operations internal staff consists of three (3) employees: one (1) manager and two (2) field personnel. Salaries, Taxes and Benefits decreased due to the outsourcing and/or elimination of one (1) position during FY2017. Please refer to the Salaries, Taxes and Benefits section below for more detail. Other Roadway Operations - Internal Staff costs include employee allocable expenses such as cell phone, emergency radio dispatch, workers compensation insurance, training, travel, and various software expenses. The budget decreased $5,000 due to due to less training, conference and business events/meetings and related travel, and $3,000 in lower anticipated field equipment expenses, while vehicle operation and maintenance increased $2,000 for expected maintenance and repairs for fleet vehicles. Roadway Operations - FDOT System Insurance VARIANCE Roadway Operations - Internal Staff Employee Salaries $ 361,543 $ 264,983 $ (96,560) Employee Taxes & Benefits 131,848 98,406 (33,442) Workers Compensation 22,083 20,224 (1,859) -8.4 Vehicle Operation & Maintenance 20,148 22,285 2, Field Equipment Expense 13,180 10,350 (2,830) Training/Memberships/Travel/Conference Fees 10,750 5,500 (5,250) Software Maintenance & Support 1,832 1, (See Page 2 Annual Budget 1. Operating Expenses A. Operations (ii) Roadway Operations) $ 561,383 $ 423,580 $ (137,803) VARIANCE FDOT, Roadway Operations (System Insurance) $ 847,000 $ 862,530 $ 15, (See Page 2 Annual Budget 1. Operating Expenses A. Operations (ii) Roadway Operations) 10

14 MDX FISCAL YEAR 2018 ANNUAL MDX participates in an insurance policy with the State to insure its roadway assets and structures. The budget is based on replacement value of the roadway assets, which are updated annually by MDX s general engineering consultant. Other Operations - Public Outreach Other Operations - Public Outreach is budgeted at $945,000. VARIANCE Other Operations - Public Outreach Customer Rewards Program Support $ 100,000 $ 100,000 $ Public Relations Services 100, , Market Research 75,000 75, MDX Website Content 50,000 50, Media Production 50,000 50, Community Outreach Support 210, ,000 (60,000) Total Services: $ 585,000 $ 525,000 $ (60,000) Customer Rewards Program $ 150,000 $ 100,000 $ (50,000) Media Campaign Placement 250, , Print/Collateral/Products 50,000 35,000 (15,000) Community Outreach Sponsorships 50,000 30,000 (20,000) SunPass Direct Program - 5,000 5,000 N/A Total Product: $ 500,000 $ 420,000 $ (80,000) Public Communications Reserve 500,000 - (500,000) $ 1,585,000 $ 945,000 $ (640,000) (See Page 3 Annual Budget 1. Operating Expenses A. Operations (iii) Operations Public Outreach) Other Operations - Public Outreach is comprised of consultant support activities and various pass-through expenses. Budget provides for services of $525,000, media advertisement of $250,000, and other outreach product of $170,000. Customer Rewards Program Support includes communications strategy, campaign messaging, radio script development, and newspaper articles in support of the frequent driver rewards program. Public Relations Services include focus groups, communications planning, campaign development, and branding. Market Research covers the costs for customer telephone surveys and focus groups. MDX Website Content costs cover one (1) contracted position to maintain and update the front end of the website as needed. Media Production costs are for public outreach videos. Community Outreach Support includes personnel as needed to promote MDX s participation and presence at different community events. Customer Rewards Program expenses consist of costs for check forms, postage, equipment, address validation software, and bank fees associated with the frequent driver rewards program. Media Campaign Placement is direct advertising costs for MDX campaigns and initiatives across print, radio, and social media. Print/Collateral/Products are costs for direct mailers about MDX. Community Outreach Sponsorships include MDX participation and sponsorship of various community events. SunPass Direct Program costs are to purchase 1,000 transponders for MDX sponsored events throughout the year. 11

15 MDX FISCAL YEAR 2018 ANNUAL B. MAINTENANCE Maintenance Roadway & Facility Maintenance Services Asset maintenance services for MDX roadways, buildings, and property are billed lump sum monthly based on various cycles. Services for preserving MDX s system include daily inspections of all expressways to identify areas in need of attention or repair. The asset maintenance contractor is responsible for pavement repair, drainage maintenance, roadway signage, and guardrail and attenuator maintenance, among others. Additional tasks are work order driven as needed. The budget decrease of $207,000 is primarily due to the impact of roadway areas being maintained by the contractor for MDX Projects and When these projects are completed this cost will revert to the Maintenance budget. Periodic Maintenance & Enhanced Safety Improvements These costs include work-order driven miscellaneous improvements, repairs, and/or replacement of roadway items such as: system-wide safety enhancements of the solar Reflective Pavement Markings (RPM), illuminated LED chevrons at SR 836 and NW 137 th Avenue, additional SMART 836 corridor improvements to synchronize local roads with SR 836, enhancements to the system-wide Wrong-Way signing program, SR 836 west bound signage enhancements before NW 137 th Avenue, SR 924 end of expressway safety improvements east bound before NW 32 nd Avenue, signage for the SR 874/SR878 Interchange, guardrail improvement for the west bound exit ramp to NW 36 th Street, and miscellaneous sign installations and replacements system wide. The budget increase is primarily due to the enhanced safety improvements of $1.5 million. Intelligent Transportation Systems Maintenance This line item covers ITS infrastructure repairs and equipment rental related to repairs for system connectivity and fiber optic cables. The budget decrease of $40,000 is due to a decreasing trend in the number of fiber optic cable repairs. Charges are task authorization driven. Maintenance Support Services These costs cover the annual inspection report of the MDX System as required by the MDX Trust Indenture, support for 6 cycles of the Maintenance Rating Program (MRP), support for the development of the Request for Qualifications (RFQ) for a Construction Risk contractor, and two (2) support positions for roadway/structures maintenance and MIAMIS system, the MDX geographic information system (GIS). Charges are task authorization driven. The budget increase of $53,000 is primarily attributed to the development of the RFQ. Structural Inspections Structural inspections are ongoing throughout the year system wide, in keeping with the following federally required inspection cycles: every 2 years for bridge & overhead signs, every 5 years for high mast lighting poles, and every VARIANCE Maintenance Roadway & Facility Maintenance Services $ 6,001,274 $ 5,794,400 $ (206,874) -3.4 Periodic Maintenance & Enhanced Safety Improvements 321,000 1,820,000 1,499, Intelligent Transportation Systems Maintenance 140, ,000 (40,000) Maintenance Support Services 576, ,631 52, Structural Inspections 370, , , (See Page 3 Annual Budget 1. Operating Expenses B. Maintenance) $ 7,408,400 $ 8,815,983 $ 1,407,

16 MDX FISCAL YEAR 2018 ANNUAL years for bridge load ratings (recommended minimum by FDOT if there has been no impact or other damage). The charges are billed throughout the year and task authorization driven. Structural Inspection expenses are cyclical in nature depending on the structures in-service date and will change from year to year based on the inspection schedules. The budget increase of $103,000 is due to a larger number of structures requiring inspection in. Maintenance - Internal Staff Inspection Type Amount Routine Bridge $ 112,200 Special Bridge 9,600 Underwater Bridge 16,900 Segmental 7,947 Routine Sign 162,105 Routine HMLP 9,500 Bridge Load Ratings 12,750 L.R. Steel Box 28,000 L.R. Length > ,500 Sub-total $365,502 Additional Ratings Amount Emergency Bridge $ 16,800 Bridge Load Ratings 84,150 L.R.Length>2000 6,500 Sub-total $ 107,450 Total Structural Inspections $ 472,952 VARIANCE Maintenance - Internal Staff Employee Salaries $ 312,405 $ 197,850 $ (114,555) Employee Taxes & Benefits 93,982 58,161 (35,821) Workers Compensation (46) -5.9 Vehicle Operation & Maintenance 9,522 5,110 (4,412) Field Equipment Expense 2,420 2,360 (60) -2.5 Training/Memberships/Travel/Conference Fees 2,300 2,000 (300) Software Maintenance & Support 17,718 17, (See Page 3 Annual Budget 1. Operating Expenses B. Maintenance) $ 439,122 $ 283,929 $ (155,193) Maintenance internal staff consists of two (2) employees: one (1) manager and one (1) contract administrator. Salaries, Taxes and Benefits decreased due to the elimination and/or outsourcing of one (1) position during. Please refer to the Salaries, Taxes and Benefits section below for more detail. Other Maintenance - Internal Staff costs include employee allocable expenses such as cell phone, emergency radio dispatch, workers compensation insurance, training, travel, and various software expenses. The budget decreased $4,000 primarily due to maintenance and repairs for fleet vehicles completed in. (Remainder of page intentionally left blank) 13

17 MDX FISCAL YEAR 2018 ANNUAL C. ADMINISTRATION Employee Salaries, Taxes & Benefits Salaries, Taxes & Benefits VARIANCE Employee Salaries $ 3,075,134 $ 2,916,927 $ (158,206) -5.1 Employee Taxes & Benefits 996, ,163 (7,361) -0.7 Internship Program 4,000 4, Outside Personnel Services 10,000 5,000 (5,000) Total Salaries, Taxes & Benefits $ 4,085,658 $ 3,915,090 $ (170,567) -4.2 (See Page 4 Annual Budget 1. Operating Expenses C. Administration (i) Salaries, Taxes & Benefits) Salaries, Taxes & Benefits Currently there are thirty six (36) full time positions and one (1) part time position across the various internal staff and administration categories. This is a decrease from the forty five (45) total positions budgeted in. Total salaries for all MDX employees are $4,138,233, with taxes and benefits totaling $1,415,005. Employee health, dental, and life insurance benefits are provided through the State of Florida. In addition, MDX contracts directly with insurance carriers for long and short-term disability, as well as a supplemental life policy. As an agency of the State of Florida, MDX participates in the Florida Retirement System (FRS). For, the average salary increase for employees is 1.0. Administration Salaries, Taxes and Benefits decreased due to the elimination and/or outsourcing of two (2) positions during. Internship Program MDX participates in the Summer Youth Internship Initiative sponsored by Commissioner Barbara Jordan. Every year MDX provides paid work experience and professional skills for 2 to 3 young adults between the ages of 16 and 23. Outside Personnel Services This line item covers personnel services as needed in the event coverage is required for employee absences or temporary initiatives. The budget decreased $5,000 due to less anticipated need for outside services. Professional Services Professional Services VARIANCE General Engineering Consultant Support Services $ 585,637 $ 444,308 $ (141,329) Annual Audit & Support Services 125, ,000 (15,000) Financial & Investment Advisor Services 225, ,112 (6,888) -3.1 Legal Services 273, ,000 (40,000) State & Local Advocacy Consultants 130,000 50,000 (80,000) Industry & Community Memberships 50,000 50, Total Professional Services $ 1,388,637 $ 1,105,420 $ (283,217) (See Page 4 Annual Budget 1. Operating Expenses C. Administration (ii) Professional Services) (Remainder of page intentionally left blank) 14

18 MDX FISCAL YEAR 2018 ANNUAL General Engineering Consultant Support Services (GEC) The GEC contracts provide MDX a wide range of professional services. These tasks include general program management, development of the Long Range Transportation Plan (LRTP) and Work Program, miscellaneous planning, right-of-way support, construction management system integration and automation, and support services for finance and procurement. Costs are assignment/task authorization driven which are based on negotiated hours and contract rates. The decrease is due primarily to the construction project administration manual completed in for $125,000. Annual Audit & Support Services Description Amount Program Management $ 138,334 LTRP Amendment 6,954 Work Program Development 108,959 Miscellaneous Planning 24,548 Miscellaneous Right-of-Way 14,751 Construction Management System Integ/Auto 102,762 Finance & Procurement Support 48,000 Total GEC Support Services $ 444,308 On an annual basis, MDX undergoes an external financial audit, as well as a Single Audit, when applicable. External audit and Single Audit services are billed annually on a lump sum basis of $62,000. Accounting consulting and support services are task authorization driven as needed. The budget decreased $15,000 since it is anticipated that there will be less need for accounting consulting and support services in. Financial & Investment Advisor Services The financial advisor assists with MDX s financial planning, debt issuance, swap advisory, and other general financial service needs. These services are task authorization driven as needed. Investment advisory services related to MDX s investment strategies and portfolio performance are billed quarterly based on the Authority s portfolio value. The budget decrease of $7,000 is due to fewer funds on hand available for investment in. Legal Services Legal services include assistance in preparation of solicitation and contract documents, legal research, bond counsel, and legal advice and services related to ongoing activities of MDX. Charges are task authorization driven and billed at an hourly rate each month. The $40,000 decrease in the budget is due to less anticipated need for outside services. State & Local Advocacy Consultants The legislative representative assists and advises MDX with respect to State executive, administrative, and legislative actions that may have bearing on MDX. They also assist in preparing, presenting, and communicating MDX s legislative agenda with local and state representatives. A monthly retainer is charged, plus expenses. Industry & Community Memberships These costs include annual memberships in transportation, local commerce entities, and community organizations. (Remainder of page intentionally left blank) 15

19 MDX FISCAL YEAR 2018 ANNUAL Office Administration Office Administration VARIANCE Headquarters Expenses & Utilities $ 131,430 $ 117,665 $ (13,765) Headquarters Maintenance 192, ,132 (80,000) Headquarters Supplies, Postage & Document Storage 67,225 53,220 (14,005) Headquarters Vehicle Operation & Maintenance 4,515 5,700 1, Advertisement of Procurement & Public Notices 39,000 22,750 (16,250) Insurance Costs 66,151 68,154 2, Industry Continuing Education/Travel/Conference Reg Fee 96,940 78,540 (18,400) Memberships & Training 36,748 31,650 (5,098) Headquarters Information Technology 353, ,216 (66,021) Total Office Administration $ 987,378 $ 777,027 $ (210,351) (See Page 4 Annual Budget 1. Operating Expenses C. Administration (iii) Office Administration) Headquarters Utilities These expenses include utilities and general expenses for the MDX headquarter building including electricity, telephone/cell phone, water and sewer, waste/recycling services, headquarter parking expenses, and alarm system monitoring. The budget decrease of $14,000 is primarily due to an over estimate of electricity rate increases from the prior fiscal year and lower rates under a new wireless services contract. Headquarters Maintenance This includes headquarter janitorial services, minor repairs, and furniture & fixture expenses. The budget decrease of $80,000 is due primarily to the one-time charge in related to a roof replacement at the MDX headquarters. Headquarters Supplies, Postage & Document Storage These costs include administrative expenses such as postage, office supplies, HR expenses, document storage, printing, and publications. The budget decrease of $14,000 is primarily due to lower office equipment maintenance rates related to newer office equipment purchased in previous fiscal years, decreased HR expenses, and publications. Headquarters Vehicle Operation & Maintenance This includes regular scheduled maintenance and as needed repairs on MDX vehicles, as well as fuel and parking expenses incurred in conducting MDX business. The $1,200 increase is due to anticipated increases in maintenance and repair costs for headquarters vehicles. Advertisement of Procurement & Public Notices These costs are associated with advertising MDX solicitations, scheduled committee meetings, and other administrative communications. The budget decrease of $16,000 is based on less anticipated advertisements. Insurance Costs This line item includes general liability, auto, headquarter property, headquarter flood, and administrative staff worker s compensation insurance costs. The budget variance of $2,000 is due to an increase in insurance rates. Industry Continuing Education/Travel/Conference Registration Fees These expenses for Board members and staff include business-related industry conferences and travel costs incurred in the furthering of MDX business, subject to the provisions of section , Florida Statutes. The budget decrease of $18,000 is primarily due to less conference and business events/meetings and related travel by Board members and staff. 16

20 MDX FISCAL YEAR 2018 ANNUAL Memberships & Training These costs include ongoing and renewal of professional certification/licensing, training, and memberships to professional organizations. The budget decrease of $5,000 is due to fluctuations in cost based on employee training needs and variations in annual continuing education requirements for certifications. Headquarters Information Technology These costs include headquarter hardware/software maintenance, audio visual services/repairs, facility security access system maintenance, computer equipment expenses, and maintenance and support of MDX s financial management system (FMS). The budget decrease of $66,000 is due to the end of the desktop computer replacement program, lower Adobe Acrobat maintenance due to the purchase of new licenses, and expected lower audiovisual and facility security access system repairs due to anticipated equipment replacement. Small & Local Business Outreach Description Amount Hardware Maintenance & Support $ 40,350 Software Maintenance & Support 111,576 FMS Maintenance & Support 62,276 HQ AV Maintenance & Support 37,776 Facility Security Access Maintenance 29,248 Computer Equipment Expense 5,000 Cable TV Access 990 Total $ 287,216 Small & Local Business Outreach VARIANCE Small & Local Business Outreach $ 80,000 $ 70,000 $ (10,000) (See Page 4 Annual Budget 1. Operating Expenses C. Administration (iv) Small & Local Business Outreach) This expense includes the MDX for Business Program and other outreach initiatives. The MDX for Business Program is comprised of three major components: an education program, a career enhancement program, and an annual conference. These resources are meant to empower small and local businesses, provide information, and prepare them to do business with MDX and other public and private entities. The annual conference is budgeted at $20,000 and the education and career enhancement program is budgeted at $50,000. The budget decrease of $10,000 is due to services that are now performed in-house. Treasury & Bond Administration VARIANCE Treasury & Bond Administration $ 99,620 $ 91,020 $ (8,600) -8.6 (See Page 4 Annual Budget 1. Operating Expenses C. Administration (v) Treasury & Bond Administration) Treasury & Bond Administration These charges include account management fees for operating, payroll, and Trustee accounts, as well as bond rating agency recurring annual surveillance expenses for Fitch, Moody s, and Standard & Poor s. The budget decreased $9,000 due to lower wire activity anticipated for Trustee accounts in. (Remainder of page intentionally left blank) 17

21 MDX FISCAL YEAR 2018 ANNUAL Contingency and Litigation Contingency & Litigation VARIANCE Standard Contingency $ 1,000,000 $ 515,000 $ (485,000) Legal Services - Litigation 250,000 2,500,000 2,250, Total Contingency & Litigation $ 1,250,000 $ 3,015,000 $ 1,765, (See Page 4 Annual Budget 1. Operating Expenses D. Contingency & Litigation) Contingency The budget includes a $515,000 Contingency for issues that may arise throughout the fiscal year. The Contingency represents approximately 0.85 of the total Operating Budget. Per the Budget Policy, the Contingency will be available for use, at the Executive Director s discretion with written recommendation from the Chief Financial Officer, for unanticipated expenses during the fiscal year not to exceed 10 of the amount budgeted per category. Litigation These costs are specifically for legal representation in certain civil actions and appellate efforts related to ongoing litigation. Charges are billed on an hourly rate plus expenses each month. The $2.5 million increase in the budget is the General Counsel s best estimate based on discussions with MDX litigation teams. The majority of funds are related to litigation costs which will be incurred in the case titled, ETC v. MDX, where the original presiding Judge was recently disqualified. On May 2, 2017, the new presiding, Judge William Thomas, ruled that he will not abide by any prior Judge s rulings and the case will be retried from the beginning. 2. DEBT SERVICE Senior Debt Toll System Revenue & Revenue Refunding Bonds VARIANCE Interest Expense Series 2005 Interest $ 4,358,519 $ 4,383,600 $ 25, Series 2006 Interest 5,679,213 - (5,679,213) Series 2010A Interest 18,217,156 18,005,206 (211,951) -1.2 Series 2013A Interest 13,173,875 12,652,375 (521,500) -4.0 Series 2013B Interest 3,737,500 3,737, Series 2014A Interest 15,572,491 15,572, Series 2014B Interest 12,946,000 12,734,500 (211,500) -1.6 Series 2016A Interest - 4,791,000 4,791,000 N/A Total Senior Debt Interest Expense $ 73,684,754 $ 71,876,672 $ (1,808,083) -2.5 Principal Payments Series 2005 Principal Payment $ 1,000,000 $ 1,170,000 $ 170, Series 2010A Principal Payment 7,065,000 8,585,000 1,520, Series 2013A Principal Payment 10,430,000 13,190,000 2,760, Series 2014B Principal Payment 4,230,000 4,640, , Total Senior Debt Principal Payments $ 22,725,000 $ 27,585,000 $ 4,860, (See Page 5 Annual Budget 2. Debt Service) Total Debt Service $ 96,409,754 $ 99,461,672 $ 3,051, MDX issues Revenue Bonds for the sole purpose of funding infrastructure. The debt service payments are based on the current outstanding debt service requirements. 18

22 MDX FISCAL YEAR 2018 ANNUAL 3. CAPITAL (NON-WORK PROGRAM) EXPENDITURES Capital (Non-Work Program) Expenditures VARIANCE HQ- Audio Visual $ 55,000 $ 150,000 $ 95, HQ - Office Equipment 8,000 - (8,000) HQ- Computers 5,000 - (5,000) HQ - Software 6,000 - (6,000) HQ - Vehicles 50,000 - (50,000) HQ - Network Infrastructure 540, ,000 (340,000) HQ - Improvements 125, ,000 25, Toll-ITS Facility Improvements 317, , Tolls - Network Infrastructure 40, , , ITS Infrastructure 10,000 30,000 20, Other Roadway Assets 125,000 30,000 (95,000) Lease Property Improvements 575, ,000 (125,000) Total Capital (Non-Work Program) Expenditures $ 1,856,000 $ 1,527,000 $ (329,000) (See Page 5 Annual Budget 3. Capital (Non-Work Program) Expenditures) Capital (Non-Work Program) Expenditures: Headquarter Audio Visual $150,000 to upgrade equipment to digitize meetings that take place in the boardroom, and replace 1 projector and 2 digital switches in the conference rooms. Headquarter network infrastructure costs of $200,000 are for the phone system for $150,000 and $50,000 for the Virtual Private Network (VPN) and some field core switches. Headquarter improvements of $150,000 are to upgrade the headquarters security access system and cameras. Toll and ITS facility improvements of $317,000 are to expand the existing access control system to toll shelters and ITS buildings under the same system. Tolls network infrastructure costs of $200,000 are to purchase hardware for data storage for the testing of vendor software, testing disaster recovery, and can be used in production environments as needed. ITS infrastructure costs of $30,000 are for ITS switches for SR 874 and SR 878 for $20,000, and $10,000 for fiber testing equipment replacement as needed. Other roadway asset costs of $30,000 cover miscellaneous multi-post sign panel replacements, and decreased due to less anticipated replacements in. Improvements for lease property of $450,000 are to complete of various renovations. (Remainder of page intentionally left blank) 19