California Public

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• California Public Community Transportation
  Conference
• Public Private Partnerships
• November 7, 2008

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Bay Area Rapid Transit System

• Oakland Airport Connector (OAC)
• 5.1 km system connecting BART to Oakland
  International Airport
• AirBART bus serves OAK
• FTA P5 Project
• Farebox Revenue to Cover Financing and
  Operations
• BART already serves SFO Airport

West Dublin Station
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About the Oakland Airport Connector Project

• Connecting BART to the Oakland International
  Airport
• Driverless Automated People Mover System
• Safe, Highly Reliable, Fully Automated,
  Driverless Vehicles
• Proven Technology
• Meets capacity needs
• Low Cost to Operate and Maintain
• Seamless integration into the BART
• Reduce Traffic Congestion
• Fares Sustain Operation
• Replacing successful AirBART Bus System

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OAC From Birds Eye View
BART
Coliseum Station
I-880
Oakland Airport Runway
Hegenberger Rd.
Doolittle Drive
Future Doolittle Station
OAK
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Why Public Private Partnership (P3)

• Series of Events
• 2002 Board Adopted the Project
• 2002-2004 Design Build Operate Maintain (DBOM)
  Procurement (5 10yr OM)
• Estimated Capital Cost ? 380M Public Grants
  ? 260M
• Funding shortfall would only get worse
• Steady growth at the Oakland Airport limited
  airport parking
• Strong growth of AirBART bus ridership
• Demand for reliable service
• 2004 2005 Investigated P3
• Conservative financial model
• Outreach to Private Industry
• Enabling Legislation - California Infrastructure
  Finance Act
• BART Board approved
• 2006 Prequalified 3 Prospective Concessionaire
  Teams
• 2007 Concession Agreement Released for Proposals
• 2 of 3 proposer teams withdraw
• 2008 October
• Allow procurement to expire
• Issue new procurement aligned within limits of
  new affordability

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Pre-qualified Prospective Project Companies
Technologies Sept. 06
WITHDRAWN
WITHDRAWN
Oakland Airport Access Team Sumitomo
Tutor-Saliba NORD/LB Bank of Tokyo/Mitsubishi DM
JM Harris Tutor-Saliba/OG, JV Mitsubishi Mitsubis
hi
Airport Connector Team Babcock Brown Merrill
Lynch Co. Inc. Parsons Transportation Inc. FCI
Constructors Bombardier Bombardier
bbm AiRail Transfer Team PPC
Balfour Beatty Mgmt Inc Mitsui Finance
Citigroup Global/Mitsui/Balfour Design
STV, Inc. Civil Balfour/Shimmick Syste
ms Ishikawajima-Harima OM
Veolia
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Concession Agreement Risk Allocation Key
Components
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Our Initial Financing/No Longer Valid

• BART Delivery Costs include pre-construction
  costs such as preliminary engineering, right of
  way procurement, document preparation,
  construction management contingency reserves
• Private Financing Costs include interest
  during construction, debt service reserves, and
  transaction and SPV costs
• Public Funds for Ridership Reserve Fund

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Reduced Ridership/Revenue and Affordability
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Revenue Projection and Repayment Plan
400M Capital Cost 210M Public
Contribution 140M TIFIA Loan 60M Ridership
Reserve 6 Fare
Revenue Surplus
Ridership Reserve
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Market Shifts in Bay Area Airports

• OAK 14.7 MAP to 12.7 MAP
• AirBART 1.3 MAP to 1.1 MAP
• SFO up significantly
• Airline Industry still dynamic

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2007 vs 2008 Ridership Projections
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OAC - Where We Are

• Escalating costs continue to be a challenge
• US and Bay Area air-travel market is dynamic
• Reassessing project to align revenue
  projections with financing options
• Additional Public Funds
• Other revenue sources / ridership backstop
• Financing options based upon current ridership
• Modification to procurement approach
• Procurement Status
• Allow procurement to expire
• Issue new procurement aligned within limits of
  new affordability

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PPP Lessons Learned to Date

• New to US market - may not apply to all project
  types (transit typically subsidized)
• PPP agreements are very complex require
  experienced legal and financial advice
• Complex construction and systems contracts will
  be priced conservatively
• Apportion risk appropriately - risk transfer to
  private partner will be costly
• Dont be prescriptive allow private partner to
  be creative
• Try to keep competition involved in the process
• Third party involvement is a large factor for
  U.S. transactions
• Education of stakeholders is required
• Stay flexible
• PPP financing does not solve funding issues for
  all projects

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