AWARD OF NEW PARATRANSIT SERVICES CONTRACT

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1 September 22, 2005 Department of Customer Contract Services

2 Purpose To recommend award of the paratransit services contract to MV Transportation, Inc. in the amount of $203,542,817 for a contract period of four base years. Subsequent Board approval will be sought to award each of the two, two-year options. To recommend the approval of additional contract authority to cover the cost of performance incentives for four years ($6 million) and fuel escalation prior to the cutover of operations ($500,000) for a total award amount of $210,042,817 for the four base years of the contract 2

3 Background The current paratransit services contract with Logisticare, Inc. was awarded in October, 1999 and ends on January 14, 2006 The Board authorized initiation of the procurement in October, 2004, and the Request for Proposals for the successor contract was released in April, 2005 The procurement was conducted as a "Best Value" procurement, which seeks the best combination of technical capability and price Four firms submitted proposals; three were deemed to be technically responsive The initial proposal prices ranged from $200 million to $290 million for the four base years and $537 million to $811 million for the entire eight years 3

4 Procurement Process The Best Value procurement method combines technical evaluation with examination of cost; as technical proposals become more technically equivalent, cost becomes more critical to the selection Technical Criteria: Central Reservation, Scheduling, and Transmission of Trips - new software is a superior product, which is critical to realizing service efficiencies through schedule optimization, ride matching, route management, aggressive dispatch (notifying customers BEFORE they experience delays) Operating/Service Plan compliance with ADA requirements, fleet management and maintenance plan, service operation model Management Plan transition plan, management structure, recruitment, safety, complaint investigation, alcohol and drug testing Experience and History of Past Performance 4

5 Procurement Process Cost Criteria: Reasonableness of the proposed costs analysis of cost drivers and supporting documentation Realism comparison of each cost proposal item and labor skill levels with the offeror s technical proposal Completeness whether all items are properly included Price proposals were examined only for those proposers who were determined to be technically acceptable 5

6 WMATA Requirements to Improve Paratransit Service Advanced commercial off-the-shelf (COTS) software to more effectively and efficiently manage reservations, trip scheduling and dispatch Productivity goals (trips per hour, from 1.25 in CY2006 to 1.55 for 2009 forward) More rigorous incentives and disincentives ($125,000 per month maximum, or $6 million for the base four years of the contract, if all incentives are earned) On-time performance Missed Trips less than 1.05% Passenger Injuries fewer than 2.5 per 100,000 trips Total Complaints fewer than 1 per 1000 trips Telephone Response 6

7 WMATA Requirements to Improve Paratransit Service Installation of functional, proven Mobile Data Computers and an Automatic Vehicle Location System to validate trips and on-time performance Additional auditing and monitoring requirements Liquidated damages for failure to implement/ commence operations on January 15, 2006 Implementation of a web-based application and Interactive Voice Response application to allow patrons to easily make reservations or check on vehicle location without utilizing a live agent 7

8 Results of Best Value Procurement Process MV Transportation, Inc. was deemed to have offered the "best value" of all of the proposers an excellent, innovative technical proposal coupled with the lowest proposed cost. Cost proposal was lowest for both the base four years, as well as, the maximum period of eight years, including options $203,542,817 for a four year base contract MV will directly operate 34% of the paratransit service; five subcontractors will operate 61% as dedicated service and cabs will fulfill the remaining 5% (far superior to the current 20% taxi allocation) MV will utilize Trapeze as the COTS software, which will: perform schedule optimization routines to ensure the most trips are delivered with the fewest vehicles in the shortest time permit real-time recalculation of arrival times and timely notification of patrons if traffic problems or other service issues delay arrivals minimize the number of unscheduled trips left open until the day of service (this practice has caused missed and late trips and customer dissatisfaction) 8

9 About MV: One of the largest paratransit providers in the nation, operating more than 130 paratransit service contracts and 3,000 vehicles nationwide Founded by Feysan Lodde, an African American female Major client properties include Fastran (Fairfax County, VA) San Francisco Muni SamTrans (San Mateo, CA) Lynx (Orlando, FL) MV on-site transition staff includes former employees of Trapeze to ensure smooth data migration and system implementation 9

10 Service Improvements in the New Contract Trapeze reservation/scheduling/dispatch software will greatly improve trip management, minimize missed and excessively late trips, enhance communication with customers about vehicle location and arrival times, match trips and minimize vehicles needed to provide service Mentor Ranger Mobile Data Computers/Automatic Vehicle Location System will validate trip delivery and on-time performance and assist dispatchers with real-time vehicle monitoring for in-route adjustments and patron notification of vehicle arrival time FleetFocus software will manage maintenance scheduling, lifecycle costing and performance analysis, to provide more reliable vehicle performance 10

11 Service Improvements in the New Contract (continued) MV s cost proposal emphasized high productivity and low overhead, with the use of proven technologies to maximize trip efficiency MV will install the DriveCam on-board camera system on all non-taxi vehicles, which will enhance driver training, operations monitoring and complaint/incident investigation Operators will leave door hangers on customers doorknobs in case of patron no-shows to remind customers about our no-show policy and the need for timely cancellation MV will provide a free trip voucher to any customer experiencing a missed or excessively late trip 11

12 Recommendations That the Board of Directors approve the award of the new paratransit service contract to MV Transportation, Inc. in the amount of $203,542,817 for a contract of four years That the Board of Directors approve additional contract authority of $6 million to cover the cost of incentives, if earned, and an additional $500,000 for fuel escalation, if necessary and fully documented, between September 22, 2005 and January 9, 2006 The final award amount for the four base years is $210,042,817 12

13 Next Steps Award the contract September 22, 2005 Conduct first planning meeting September 23, 2005 Initiate transition, training, data conversion, vehicle purchase immediately "Go-Live" with reservations January 1, 2006 Service Cut-Over January 15,

14 Budget Impact Base Year One (Calendar Year 2006) Total $47,854,409 Base Year Two (Calendar Year 2007) Total $48,031,858 Base Year Three (Calendar Year 2008) Total $54,171,291 Base Year Four (Calendar Year 2009) Total $59,985,259 Total Base Years $210,042,817 Option 1, Year One $69,479,967 Option 1, Year Two $80,171,522 Total Option 1 $149,651,489 Option 2, Year One $92,831,275 Option 2, Year Two $107,677,139 Total Option 2 $200,508,414 Total Contract Period $560,202,720 Base year totals include $1.5 million per year for performance incentives. Also included in Base Year 14 1 is $0.5 million for fuel escalation

15 Revenue, Expense & Funding Sources (Dollars in thousands) FY99 FY00 FY01 FY02 FY03 FY04 FY05 Revenues $ $ $ 1,202.5 $ 1,698.3 $ 1,927.8 $ 2,364.8 $ 2,826 Expenses $12,496.3 $17,185.4 $19,730.0 $25,417.8 $33,185.1 $36,945.5 $42,262 Gross Subsidy $12,592.4 $16,684.3 $19,388.2 $24,547.5 $32,539.6 $35,744.3 $39,436 Passenger Trips 477, , , , ,425 1,112,358 1,253,900 15

16 Page 1 of 4 (Board Copy) Washington Metropolitan Area Transit Authority METRO ELECTRONIC ACTION DOCUMENT IDENTIFICATION MEAD ID: ACTION: Initiate & Award AWARD VALUE: (Not yet awarded) CONTRACT: (Proposed) C05108 FUND SOURCES: (View) Operating Funds CONTRACTOR: LAST MODIFIED: 09/16/2005 SUBJECT: PURPOSE: DESCRIPTION Award Paratransit Services Contract to MV Transportation, Inc. Award the paratransit services contract to MV Transportation, Inc. for a contract period of four base years in the amount of $203,542,817, plus $6 million for performance incentives and $500,000 for potential fuel cost escalation (a total of $210,042,817). The proposal includes two two year options in the amount $344,159,903 plus $6 million for performance incentive, execution subject to future Board Approval. ORIGINATION INITIATOR DEPARTMENTAL APPROVAL CHRISTIAN BERES on 08/24/2005 Approved by WILKINS, PAMELA 09/12/2005 PHONE: OFFICE: FARE DEPT: Communications COORDINATION (ROUTING) OFFICE NAME ACTION/DATE BEMR (7600) WILKINS, PAMELA Approved 09/12/2005 AGMC (6100) AGOURIDIS, LEONA Re-assigned 09/09/2005 AUDT (7210) STEWART, JAMES Approved 09/12/2005 PRMT (7400) ZINGALE, JAMES Approved 09/13/2005 COUN (1410) O'KEEFFE, CAROL Approved 09/16/2005 FINAL APPROVALS OFFICE NAME/ACTION BEMR Approved for SCOS by HAROLD BARTLETT on 09/16/2005 GM GMGR CEO (Not Yet Approved) BOARD BOARD WMATA (Not Yet Approved)

17 Page 2 of 4 Washington Metropolitan Area Transit Authority METRO ELECTRONIC ACTION DOCUMENT BACKGROUND: NARRATIVE On October 22, 2004, the Board of Directors gave approval to initiate a competitive procurement, for a Paratransit System Management and Service contract. The previous contract with Logisticare, Inc. was awarded on October 19, 1999 and terminates on January 14, 2006 The Request for Proposals for the successor contract was released in April, The procurement was conducted as a "Best Value" procurement, which combines technical achievement with price. Four proposers responded; Logisticare declined to propose. Evaluation committees were established to assess technical competence and cost. MV Transportation, Inc. is deemed to have offered the "best value" of all of the proposers. MV Transportation, Inc. will directly operate 34% of the paratransit service; subcontractors will operate 61% and cabs will fulfill the remaining 5% The initiation action approved by the Board on October 22, 2004, provided contracting authority in the amount of $473.6M. This cost covers the period beginning in January 2006 and ending in January 2014, including four base years and four option years for a total of eight years. DISCUSSION: This action requests Board approval to award a Paratransit System Management and Service contract for a four-year base (January 15, January 14, 2010). Two, two-year options (January 15, January 14, 2014) are subject to future Board approval. In addition, the action requests further approval for contract authority to cover $12 million for performance incentive payments, if earned ($6M for the base period and $6M for the option years), and $500,000 to cover the cost escalation of fuel between September 22, 2005, and January 9, 2006, when the cost of fuel will be set by a DOE index (if required). MetroAccess (MACS) is a regional service required by the Americans with Disabilities Act (ADA) of Since 1994, MACS has provided curb-to-curb transportation service for customers with disabilities unable to use the WMATA fixed-route service to complete their trips. WMATA is legally required to meet the demand of the service. WMATA currently provides MACS service through a single prime contractor who is responsible for all phases of the current MACS operation. The scope of services includes purchase, installation, and maintenance of state-of-art, commercial-off-the-shelf (COTS) automated scheduling software; providing centralized reservations, schedules and dispatch to facilitate reserving, scheduling and providing trips for customers; obtaining and maintaining a fleet of vehicles, equipped with Mobile Data Terminals and Automated Vehicle Locators compatible with the installed scheduling software and WMATA`s "Ride Guide" and capable of providing dial-in "Where`s My Ride?" updates; and sub-contracting with private providers and taxicab companies for service in Maryland, the District of Columbia, and northern Virginia. This will enable to validate trips and on-time performance. Changes from the existing contract include payment per revenue hour (first pick-up to last drop-off with no more than a one, one-hour gap on any route/schedule) instead of per trip, and increased performance standards with incentives and disincentives to encourage greater operating efficiency and on-time performance. This contract also incorporates certain recommendations from the Regional Paratransit Task Force; specifically,strengthening the eligibility certification process and charging a supplemental fare for service outside the ¾ mile ADA boundary. The closure timing of the existing contract (C-93634) with LogistiCare, Inc. will allow sufficient time to purchase, install, test, and convert data to the new scheduling software; and acquire and outfit the new MACS vehicles as required. The existing contract with Logisticare, Inc. terminates on January 14, It is anticipated that contract award will be issued on September 22, The first planning meeting will be conducted on September 23, 2005, and the transition process will commence to include training, data

18 Page 3 of 4 conversion, and vehicle purchase. The current plan is to "Go-Live" on reservations January 1, 2006, with Service Cut-Over January 15, Fuel costs are currently extremely volatile and have risen substantially since issuance of the Requests for Proposals. This action includes a request for approval of additional contract authority to cover fuel cost escalation. ALTERNATIVE: There are no alternatives to providing complementary paratransit service. Federal regulations require that WMATA accommodate the demand for paratransit service. PRIOR APPROVALS: On October 22, 2004, the Board of Directors gave approval to initiate a competitive procurement, for a Paratransit System Management and Service contract. IMPACT ON FUNDING: Multi-Year Contract (with option years) Budget: Operating Budget, Fiscal Office: Office of MetroAccess Paratransit Account: Paratransit Transportation Service FY06 Operating Budget Budget Book Pg. 71 Fiscal Year: FY06 Services, Paratransit: $49,534, Unspent Obligation: $21,860, Spent YTD: $3,084, This Action: $24,177, Remaining Funds: $412, Remaining Base Contract Cost: (FY07 thru FY10) $180,615, Contract Option Cost (FY10 thru FY14) $344,159, Remaining Base Contract Cost (Includes Incentives) $185,865, Outyears Contract Option Cost (Includes Incentives) $350,159, Total Project Cost/Award: (FY06 thru FY14) $547,702, Total Project Cost/Award: (Includes fuel Esc. & Incentives) $560,202, Remarks: 1. There are sufficient funds available in the Department of MetroAccess Paratransit budget to support this action. 2. This is a request for a four-year base period. The two, two-year option periods will be exercised only upon subsequent Board approval. Since the base period will overlap four fiscal years, the base period will be funded from fiscal years 2006, 2007, 2008, 2009, and 2010, while the option years will be funded from fiscal years 2011, 2012, 2013, and Increased demand may impact the overall cost of the service. Funding for all years is subject to Board approval of the budget and the availability of funding.

19 Page 4 of 4 SCHEDULE: Notice to proceed for the contract must be issued no later than September 23, 2005, to preclude any lapse in paratransit service AFFIRMATIVE ACTIONS REQUIREMENTS: The contractor will be required to comply with Executive Order 11246, Rev. No 4. DBE REQUIREMENTS: Pursuant to WMATA Board Resolution , DBE goals are not set on operationally funded contracts. RECOMMENDATION: That the Board of Directors approve the award of the new paratransit service contract to MV Transportation, Inc. in the amount of $210,042,817, for a contract of four years This amount includes $6,000,000 to cover payment of performance incentives, if earned, and $500,000 to cover fuel cost escalation between the date of award and January 9, 2006, the date that fuel prices will be set for this contract.

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