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LACMTA East San Fernando Valley Transit Corridor Procurement Options Analysis

Risk Assessment of Procurement Options

Artist rendering of East San Fernando Valley Light Rail System

Los Angeles County Metropolitan Transportation Authority (LACMTA) 


Los Angeles, CA



Alternative Delivery/ P3 Evaluation

Risk Assessment and Risk Management

Rendering of proposed ESFV Light Rail
Source: LACMTA

SHA Analytics, LLC served as part of the financial advisory team to assist LACMTA's Office of Extraordinary Innovation in its evaluation of procurement options for the East San Fernando Valley (ESFV) Transit Corridor. One of the alternatives under consideration for the ESFV Transit Corridor involves the construction of a new 9-mile Light Rail Transit (LRT) line along Van Nuys Boulevard and San Fernando Road, between the Van Nuys Metro Orange Line Station in the south to the Sylmar/San Fernando Metrolink station in the north. Several procurement options are being considered, including conventional procurement under a Design-Build contract, and Public-Private-Partnership (P3) options including Design-Build-Finance-Operate-Maintain (DBFOM).

We led the quantitative risk analysis of the project cost and schedule, including developing risk allocation scenarios to evaluate the potential transfer of risk between the public and private parties under a P3 procurement option. This risk analysis is conducted for the procurement, design & construction, and operations and maintenance phases of the project. This quantitative risk analysis feeds directly into the Value-for-Money (VfM) analysis that will assist LACMTA in selecting the procurement option that offers the best value. Since this is one of the initial transit procurement options evaluations that Metro is conducting, SHA Analytic, LLC has also worked with LACMTA and its advisers to develop guidance documents for Quantitative Risk Assessment to support Value for Money Analysis. In addition to the quantitative risk analysis, SHA Analytics, LLC was also involved in the market sounding process to collect inputs from the industry, including design & construction firms, developers, vehicle manufactures and transit operators. Inputs gathered during these market sounding meetings help to inform and validate the risk analysis. 

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