AGENDA ITEM 10-A
ACTION ITEM
TO:
CHAIRMAN COVINGTON AND THE VRE OPERATIONS BOARD
FROM:
DALE ZEHNER
DATE:
JANUARY 20, 2012
RE:
AUTHORIZATION TO ISSUE A TASK ORDER FOR ANALYSIS
OF VRE LONG TERM ROLLING STOCK MAINTENANCE,
EQUIPMENT, AND FACILITY NEEDS
________________________________________________________________
RECOMMENDATION:
The VRE Operations Board is being asked to authorize the Chief Executive
Officer to issue a task order to STV, Inc., under the MEC V contract, to study and
make recommendations regarding VRE’s long term rolling stock maintenance,
equipment, and facility needs in an amount not to exceed $250,000.
BACKGROUND:
Since 2004, VRE has worked to acquire new rolling stock equipment as well as
design and construct maintenance facilities. Specifically, VRE has purchased 20
new locomotives, 71 new passenger rail cars, constructed a general service and
inspection building at each maintenance location, constructed an automated
train wash facility at Crossroads, and acquired locomotive and car jacks.
Construction of a warehouse at Crossroads is currently underway and an
automated train wash facility at Broad Run is being funded and prepared for
construction. The Strategic Plan adopted in 2004 provided the general direction
and roadmap to accomplish these projects.
The next step is refining this roadmap into an action plan that addresses life
cycle maintenance and overhaul requirements for the new rolling stock.
Specifically, VRE needs to ensure life cycle maintenance and overhaul
requirements are planned for in advance to ensure existing facilities can
accommodate these requirements. If they cannot, plans for equipment and
facility enhancements must be initiated and funded or contracted services must
be obtained.
The scope of work includes a comprehensive review of the current VRE
maintenance organization, structures, practices, and facilities as well as
indentifying future requirements. A long range plan will be developed to assure
orderly growth and provisions for future maintenance and overhaul of the fleet.
This plan will address the equipment needs of VRE for the next 25 years.
Specific information on the scope of work is provided below. A draft final plan
will be completed within five months from the NTP.
1. Evaluate existing management plans
a. Review current service requirements
b. Review fleet and service expansion plans
c. Review facility expansion plans
2. Assess condition of rolling stock
a. Review rolling stock maintenance records
b. Review rolling stock failure data
c. Identify failure and repair trends
d. Review materials consumption
e. Prioritize maintenance needs of fleet by system
3. Review original equipment manufacturer (OEM) maintenance plans
a. Identify assumptions used
b. Determine actual VRE duty cycles and reconcile with assumptions
4. Review current rolling stock maintenance practices
a. Determine how well OEM recommendations are followed
b. Determine reactive versus preventive maintenance
c. Review material availability impacts
5. Review rolling stock modifications and refits
a. Identify impact of pending programs such as positive train control
(PTC)
b. Indentify pending field modification instructions
6. Develop future rolling stock maintenance plan and schedule
a. Develop intervals by system and component
b. Identify system or components that can be run to failure
c. Identify systems that can run beyond OEM recommendations
d. Develop maintenance tasks in packages
7. Assess condition of maintenance facilities and shop equipment
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8. Identify facility requirements for expansion of service and maintenance
practices
9. Identify overhaul options for rolling stock
a. By VRE at VRE facility
b. By third party at VRE facility
c. By OEM at approved facility
d. Off-site by third party
FISCAL IMPACT
Funding is available from two federal grants, VA-05-0038 and VA-90-X352, with
local match being provided from state and local funds.
The MEC contract was awarded in April of 2011 and is structured as a task order
agreement with a contract value not to exceed $5 million over five years. The
original procurement included an evaluation of two submissions, with STV being
the successful proposer. Award of the original MEC contract included employee
hourly and overhead rates which are updated annually and were used to prepare
this task order. The task order includes fully burdened labor, travel, and
expenses.
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TO:
FROM:
DATE:
RE:
CHAIRMAN COVINGTON AND THE VRE OPERATIONS BOARD
DALE ZEHNER
JANUARY 20, 2012
AUTHORIZATION TO ISSUE A TASK ORDER FOR ANALYSIS
OF VRE LONG TERM ROLLING STOCK MAINTENANCE,
EQUIPMENT, AND FACILITY NEEDS
RESOLUTION
10A-01-2012
OF THE
VIRGINIA RAILWAY EXPRESS
OPERATIONS BOARD
WHEREAS, VRE has a contract with STV, Inc. for Mechanical and Engineering
Services; and,
WHEREAS, since 2004, VRE has purchased new rolling stock equipment; and,
WHEREAS, VRE has constructed and acquired facilities to support maintenance
activities for said rolling stock equipment; and,
WHEREAS, VRE now needs to refine a future plan to address specific life cycle
maintenance and overhaul requirements for the new rolling stock.
NOW, THEREFORE, BE IT RESOLVED THAT, the VRE Operations Board
authorizes the Chief Executive Officer to issue a task order to STV, Inc., under
the MEC V contract, to study and make recommendations regarding VRE’s long
term rolling stock maintenance, equipment, and facility needs in an amount not
to exceed $250,000.
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AGENDA ITEM 10-B
ACTION ITEM
TO:
CHAIRMAN COVINGTON AND THE VRE OPERATIONS BOARD
FROM:
DALE ZEHNER
DATE:
JANUARY 20, 2012
RE:
ACCEPTANCE OF THE VRE TRANSIT DEVELOPMENT PLAN
FOR FISCAL YEARS 2013-2018
________________________________________________________________
_____
RECOMMENDATION:
The VRE Operations Board is being asked to accept the VRE Transit
Development Plan for Fiscal Years (FY) 2013-2018, subject to annual revision
based upon the annual adoption of the VRE Operating and Capital Budget.
BACKGROUND:
The Virginia Department of Rail and Public Transportation (DRPT) requires any
public transit operator receiving state funding to prepare, approve, submit and
annually update a six-year Transit Development Plan (TDP). DRPT initiated the
preparation of a TDP for VRE in June 2011, with assistance from their on-call
consultants Connetics Transportation Group (CTP) and Atkins. The TDP
provides the foundation for DRPT funding requests and feeds directly into its
programming process.
The TDP is structured as required by DRPT and was developed from existing
VRE plans and documents, including the VRE Strategic Plan (2004), VRE Fleet
Management Plan (June 2011), and VRE FY13 Operating and Capital Budget,
as adopted by the VRE Operations Board on December 16, 2011. The TDP was
developed in cooperation with VRE staff and VRE Coordinating Committee
(VCC) members. A summary of the draft plan was provided to the Operations
Board last month.
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The TDP is based upon existing and anticipated demand for service as identified
in the VRE Strategic Plan. The TDP Operating Plan, Capital Improvement
Program and Financial Plan are based upon the VRE FY 2013 Budget and
FY13-18 Capital Improvement Program.
VRE will be required to provide an annual update to DRPT describing progress
made in implementing the plan and any significant changes. The entire
document must be updated every six years.
FISCAL IMPACT:
The operating and capital projects listed in the TDP for FY 2013 are consistent
with the adopted VRE budget. Operating and capital projects programmed in the
out years (FY 2014 – FY 2018) are consistent with financial forecasts developed
as part of the VRE annual budget process. Implementation of such projects is
subject to VRE Operations Board approval through the regular approval and
budget processes.
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TO:
FROM:
DATE:
RE:
CHAIRMAN COVINGTON AND THE VRE OPERATIONS BOARD
DALE ZEHNER
JANUARY 20, 2012
ACCEPTANCE OF THE VRE TRANSIT DEVELOPMENT PLAN
FOR FISCAL YEARS 2013-2018
RESOLUTION
10B-01-2012
OF THE
VIRGINIA RAILWAY EXPRESS
OPERATIONS BOARD
WHEREAS, the Virginia Department of Rail and Public Transportation (DRPT)
requires any public transit operator receiving state funding to prepare, approve,
submit and annually update a six-year Transit Development Plan; and,
WHEREAS, the Transit Development Plan provides the foundation for DRPT
funding requests and feeds directly into its programming process; and,
WHEREAS, DRPT hired consultants to develop the Transit Development Plan
for VRE, in cooperation with VRE and jurisdictional staff; and,
WHEREAS, the Transit Development Plan is structured as required by DRPT
and was developed from existing VRE plans and documents including the VRE
Strategic Plan, VRE Fleet Management Plan, and VRE FY13 Operating and
Capital Budget, as adopted by the VRE Operations Board on December 16,
2011.
NOW, THEREFORE, BE IT RESOLVED THAT, the VRE Operations Board
accepts the VRE Transit Development Plan for Fiscal Years 2013-2018, subject
to annual revision based upon the annual adoption of the VRE Operating and
Capital Budget.
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AGENDA ITEM 10-C
ACTION ITEM
TO:
CHAIRMAN COVINGTON AND THE VRE OPERATIONS BOARD
FROM:
DALE ZEHNER
DATE:
JANUARY 20, 2012
RE:
AUTHORIZATION TO AWARD A CONTRACT FOR NEW
PASSENGER RAILCARS
________________________________________________________________
RECOMMENDATION:
The VRE Operations Board is being asked to recommend that the Commissions
authorize the Chief Executive Officer to award a contract to Sumitomo
Corporation of America for $21,240,000, plus a contingency of $1,900,000, for a
total amount not to exceed $23,140,000 for the purchase of eight new passenger
railcars.
BACKGROUND:
In April 2011, the VRE Operations Board approved a funding plan, developed in
conjunction with DRPT, for the purchase of 15 new railcars to replace the
remaining 20 legacy gallery railcars still in VRE service. Only 15 new railcars are
needed to replace the 20 old railcars due to maintenance cycles and the
required spare ratio. The cost of continuing to maintain the aging railcars has
also become prohibitive and a costly major overhaul will be required in the near
future if new railcars are not ordered at this time.
In April, the cost of the 15 railcars was estimated at $36 million, or $2.4 million
per car, including contingency and oversight costs.
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This amount was based on prior railcar purchases and funding was identified
from the following sources:



VRE federal formula funds (FY 2012 – FY 2015) - $15.4M
State bond funds and federal funds assigned to the state - $18.1M
VRE annual match to federal funding and capital reserve funds - $2.5M
In May 2011, the VRE Board of Operations authorized the issuance of an RFP
for the purchase of the railcars. On July 1, 2011, an RFP was issued for a base
order of eight railcars with an option for up to 42 railcars. The base order had to
be limited to eight railcars due to the schedule for receiving the federal formula
funds.
Responses to the RFP were due on September 1, 2011, and VRE received one
response from Sumitomo Corporation of America. The railcars proposed by
Sumitomo are the same as those currently in VRE service with the exception of
minor design changes required by new safety standards.
The single proposal was technically compliant, but the price exceeded VRE’s
available funding by approximately $7.3 million. The majority of the cost
increase was due to the significant increases in the cost of rolled and stainless
steel used in the construction of the frame and car shell. In addition, the car
shells are manufactured in Japan and since our last new railcar purchase, the
U.S. dollar has weakened significantly. Other cost increases were due to lack of
production volume and start up costs spread over a smaller number of units.
Following negotiations with Sumitomo and revisions to the contingency and
oversight assessments, the funding shortfall was reduced to $6.8M. The
following sources of additional funding have been identified and are
recommended. DRPT has agreed to provide an additional $1.44 million for this
project in their FY 2013 funding cycle.

Base order of 8 railcars (additional $2.05 million needed):
o Federal grant VA-05-X368 – reprogramming of $334K originally
assigned to Washington Union Terminal joint recapitalization
program with Amtrak but no longer needed to fulfill commitment
o Additional state bond funds - $219K (not available until FY 2013 –
VRE operating reserve funds will be used in the interim to execute
contracts)
o VRE capital reserve - $1.5 million
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
Option order of 7 railcars (additional $4.77 million needed). Authorization
would be sought at a later time.
o Additional state bond funds - $1.22 million
o Use of remaining available FRA loan funds - $3.55 million
The first four railcars from the base order will be delivered to VRE in January
2014. The next four will be delivered in February 2014. VRE will return to the
Operations Board at a later date to obtain authorization to exercise the option
order once federal formula funding is available. Future use of the remaining
FRA loan funds (originally used to purchase the previous 60 gallery railcars) will
require the approval of each of the VRE member jurisdictions.
VRE will also return to the Operations Board to obtain authorization to issue a
task order to STV, under MEC V, for the federally mandated oversight of this
project.
FISCAL IMPACT: The table below identifies the project costs and funding
sources for the base order of eight passenger railcars.
Project Cost
Description
Best and Final Offer Pricing from
Sumitomo
Contingency - Sumitomo
Oversight
Contingency - Oversight
Total
Cost
$21,240,000
$1,900,000
$1,250,000
$224,000
$24,614,000*
Funding Sources
Source
Federal (State Flexible Funds,
FY12 Formula Funds, X368)
State (Bond Funds – FY 2012)
VRE (FY12 budget and capital
reserve)
State (Bond Funds – FY 2013)**
Total
Amount
$13,173,200
$7,769,760
$3,452,040
$219,000
$24,614,000
*This amount varies from the total contract value being sought for approval in this item because it does not
include federally mandated oversight costs. Oversight will be a separate contract and a board item will be
presented at a later date.
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**VRE operating reserve funds will be used to execute contracts, pending approval of the State FY 2013
six-year plan.
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TO:
FROM:
DATE:
RE:
CHAIRMAN COVINGTON AND THE VRE OPERATIONS BOARD
DALE ZEHNER
JANUARY 20, 2012
AUTHORIZATION TO AWARD A CONTRACT FOR NEW
PASSENGER RAILCARS
RESOLUTION
10C-01-2012
OF THE
VIRGINIA RAILWAY EXPRESS
OPERATIONS BOARD
WHEREAS, VRE issued an RFP for new passenger railcars and,
WHEREAS, VRE received one response from Sumitomo Corporation of
America; and,
WHEREAS, the single proposal was determined to be technically compliant; and,
WHEREAS, VRE has identified the funding necessary to execute the contract for
the base order of eight railcars; and,
WHEREAS, VRE will return to the Operations Board to exercise an option order
once additional funding sources have been received.
NOW, THEREFORE, BE IT RESOLVED THAT, the VRE Operations Board
recommends that the Commissions authorize the Chief Executive Officer to
award a contract to Sumitomo Corporation of America for $21,240,000, plus a
contingency of $1,900,000, for a total amount not to exceed $23,140,000 for the
purchase of eight new passenger railcars.
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