L.A. Metro seeks flexibility in P3 procurement

California State Highway 110 (Arroyo Seco Parkway)
Photo by Doug Kerr is licensed under CC BY 2.0

County transportation agency develops own policy regarding unsolicited P3 proposal

The Los Angeles County Metropolitan Transportation Authority (Metro) is asking to be given some additional flexibility in terms of how it can procure projects through public-private partnerships (P3). A bill making its way through the state assembly’s current extraordinary session on transportation is aimed at giving Metro the ability to accept and negotiate unsolicited proposals, expanding the types of projects Metro can finance using a P3 arrangement and allowing the transportation authority to pursue P3s without first having to gain approval of the California Transportation Commission.

Essentially, the bill is designed to cut through a lot of the red tape and regulations imposed on Metro from above by the state and allow it to implement its own policies regarding P3s. Though it is allowed to utilize P3s by Section 143 of California’s Streets & Highway Code, LA Metro contends that the stipulations put on it by the code limit its ability to be truly innovative.

For instance, in terms of unsolicited proposals, Metro is able “to receive and act upon” unsolicited P3 proposals, but it “must include a competitive solicitation, in response to which ‘at least one other responsible bid’ is received.” The new bill would allow Metro to engage in sole source negotiation in response to unsolicited proposals without seeking out competitive bids.

In addition to this legislative action, the transportation authority also has designed its own policy with respect to unsolicited proposals, modeled after a similar policy in place at the Dallas Area Rapid Transit Authority. Metro also created a new Office of Extraordinary Innovation this summer, designed to facilitate resourceful and creative ideas. That office will consider unsolicited proposals as they come in. CEO Phillip Washington brought with him from a previous job in Denver this desire for flexibility and innovation. He has said that Metro needs an unsolicited proposal policy that “will encourage the private sector to bring ideas to us, rather than waiting on an RFP to come out. That policy says, ‘You bring your ideas and give us 30-45 days to determine whether it has technical or financial merit. If it does, we will begin either a competitive-type process or a single-source or sole-source-type process.’ ”

The pursuit of this flexibility hasn’t come just from Washington, though, who was appointed in March 2015. Metro had been investigating the manner in which it might take advantage of unsolicited proposals since 2013 and began drafting the policy in the summer of 2014.

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