creating partnerships through capital investments

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Creating Partnerships Through Capital Investments

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Page 1: Creating Partnerships Through Capital Investments

Creating Partnerships Through Capital Investments

Page 2: Creating Partnerships Through Capital Investments

BC Transit’s Capital Program• BC Transit’s Five Year Capital

Plan is approved annually by the Province and BCT’s Board of Directors

• Capital infrastructure requirements have increased significantly over the last ten years

• Annual reviews are used to balance the needs to replace ageing or undersized infrastructure with affordability

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20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

6.8 8.421.4 16.5

35.7

70.7

150.0

39.2 37.6

90.4 87.3

109.9

81.3

104.8

$ m

illio

ns

Fiscal Year

Historical and Forecast Capital Expenditures

Page 3: Creating Partnerships Through Capital Investments

Developing the Capital Plan

Page 4: Creating Partnerships Through Capital Investments

Annual Capital Planning Timeline

ONGOING - SPECIFIC PROJECT APPROVALS (BUSINESS CASES)

MAY and JUNE

•Project Identification

•Development of Draft Capital Plan

JULY

•BCT BoD Approves Draft Capital Plan for Submission to Province

AUGUST

•Draft Capital Plan Submitted to Province

SEPTEMBER

•Local Governnment Budgets Sent

JANUARY

•Province and BCT BoD Approves Service Plan and Capital Plan

APRIL

•New Capital Plan Starts

Page 5: Creating Partnerships Through Capital Investments

Capital Planning Challenges• Provincial and Local Government planning and funding cycles don’t always

align• BCT Board of Directors approves a 5 Year Capital Plan• Province approves a 3 Year Service Plan• Local Governments approve 3 Year Budgets and 1 year AOAs• Fiscal Year versus Calendar Year

• Some projects will have long lead times for implementation• Approvals may be required well in advance despite funding uncertainties

• Infrastructure requirements must continually be balanced with affordability – this may vary from community to community

Page 6: Creating Partnerships Through Capital Investments

Categories of Projects Projects in the Capital Plan are divided into two categories to better manage the planning and approval processes:

• Base Projects: projects that are a requirement for maintaining the existing transit system (ex. asset replacement). These projects are approved by BCT’s BoD and financial implications are included in local government AOA/budgets.

• Expansion Projects: projects involving major expansion of the asset base, typically required to meet growing ridership demand. These projects are often discretionary and require specific approval from local government and the Province.

Base Projects

66%

Expansion Projects

34%

2012/13 - 2016/17Total Cashflow by Project Category

Page 7: Creating Partnerships Through Capital Investments

Base Project Approval Process

Base Projects Identified

Local Government

Budgets

Business Case Development

BCT BoD Approval Implementation

Page 8: Creating Partnerships Through Capital Investments

Expansion Project Approval Process

Feasibility Planning

Local Government

Committment to Proceed

Business Case Development

Local Government Endorsement

MOTI Approval

Federal Funding

Approval

BCT BoD Approval

Local Government

Budgets

Page 9: Creating Partnerships Through Capital Investments

Planning as a Partnership• Projects should be planned in partnership with local governments

• This will assist in mitigating funding and approval timing challenges

• Planning and local government endorsement requirements will vary depending upon the project type

• Several activities must happen before a project can move to the implementation stage

Page 10: Creating Partnerships Through Capital Investments

Example #1: Transit Exchanges

Pre-implementation Planning

Conceptual Designs

Order of Magnitude Costs

Stakeholder Consultation

Options Evaluation

Recommended Option

Local Government

Endorsement of Recommended

Option and Funding

(Term Sheet or Council

Resolution)

3-5 Months Varies

BCT Business Case

MOTI Business Case

FederalBusiness Case(if applicable)

Approvals

2-6 months

Operational Requirements

GeographicBoundaries

Site Options

Options Evaluation (high level)

Shortlist Options

Feasibility Planning

Local GovernmentCommittment

to Project

2-4 Months Varies

Page 11: Creating Partnerships Through Capital Investments

Example #2: Expansion VehiclesPre-impPlanning

BC Transit Vehicle AssetManagement

Determines Fleet Allocations and Bus Purchase Requirements

1-2 Months

BCTBusiness Case

MOTI Business Case

Approvals

2-3 months

Years 2-3Buses are Ordered

8-18 months

Implementation

Transit Improvement

Plan

Prioritize expansion requests

3 Year Service Plan Development

Local GovernmentEndorsement

ofExpansion Hours and

Buses

Local Government

BudgetsPrepared

2 Months 2 Months

Page 12: Creating Partnerships Through Capital Investments

Breakout Session #1Objective: To gather feedback on the best way to work with local governments and operators to develop capital projects.

Group 1 & 2: Exchange ProjectGroup 3 & 4: Expansion Vehicle Project

• At what stage would you like to be engaged and how?• Who should BCT staff work with?• What information can you provide to assist in the planning process?• What should BCT be providing that will assist local partners in

endorsing the projects?

Page 13: Creating Partnerships Through Capital Investments

Summary of Breakout Session #1

Page 14: Creating Partnerships Through Capital Investments

Breakout Session #2

Objective: To discuss various approaches available to secure local government funding endorsement for expansion projects.

Group 1 & 2: Exchange Project

Group 3 & 4: Expansion Vehicle Project

• What mechanisms are available and are they acceptable? AOA process, Council resolutions, Term Sheets, etc.

• What information needs to be provided to local partners in order for BCT to receive their endorsement?

• Is endorsement at the Council level or staff level?• What, if any, challenges exist with the endorsement model? How can

these challenges be mitigated?

Page 15: Creating Partnerships Through Capital Investments

Summary of Breakout Session #2

Page 16: Creating Partnerships Through Capital Investments

Looking Ahead

• Five year capital plan totals $474 million

• The 2012/13 Capital Plan is largely focused on replacing core assets required to maintain or modestly grow the existing transit system

• Additional expansion projects will be included in future Capital Plans as consultation with local partners occurs

Page 17: Creating Partnerships Through Capital Investments

Conclusion• BC Transit is committed to planning for major infrastructure

investments in partnership with local governments

• Feedback from this session will be used to improve the process moving forward