Winnipeg, MB - The $195 million Disraeli Bridges Project, a Public-Private Partnership with Plenary Roads Winnipeg, opened on time and on budget last fall and resulted in multi-million dollar cost savings in comparison to a traditional delivery approach.
The results from the Final Value for Money report, completed by Deloitte & Touche LLP, assessed the value for money of the Design-Build-Finance-Maintain (DBFM) model for the project estimated value savings of approximately $47.7 Million or a 17.1 per cent savings.
“I think the numbers speak for themselves,” said Mayor Katz. “The Public-Private Partnership was a key-factor in saving millions of taxpayer’s dollars on this project. As we work to improve our city’s infrastructure, we will be looking for similar partnerships which will allow us to stretch our budget dollars and provide significant savings to the taxpayer.”
Under the DBFM model, the private sector partner is responsible for financing, design, construction and maintenance costs during the term of the contract, which in this case is 30 years. For its part, the City makes a commissioning payment and then annual performance-based service payments to the private-sector partner. The new bridges have a design life of 75 years.
Following Council’s direction, the Winnipeg Public Service initiated a competitive process for the procurement of a private sector partner to carry out the project. This process attracted competitive bids from numerous nationally and internationally recognized design, construction and highway maintenance firms. The procurement process emphasized City budget constraints, minimizing traffic disruption during construction, bridge quality and aesthetics, and promotion of active transportation.
Plenary Roads Winnipeg was the chosen proponent with an innovative “new bridge” approach to redeveloping the Disraeli Bridges that likely would not have resulted if a traditional design-bid-build, or design-build procurement was followed. The DBFM procurement allowed for innovation as the proponent was able to choose its own design solution either as a refurbishment of existing structures, construction of new structures, or as a combination of refurbishment and new structures.
As the capital value of this Project was significant to the City and cost overruns had the potential to impact the City’s finances and future property tax rates, cost certainty and protecting taxpayers from cost overruns was a significant consideration in selecting the DBFM approach.
The City of Winnipeg has engaged in other successful PPP projects including the East District Police Station and the Chief Peguis Trail Extension Project, which opened in December 2011, one year ahead of schedule. The South District Police Station, currently under construction, also a PPP, is on track to open in fall 2013.
View the full Value for Money report.