Transportation Tuesdays Online Sixth in webinar series for transit CEOs & board members on economic sustainability June 19, 2012

Transcription

1 Transportation Tuesdays Online Sixth in webinar series for transit CEOs & board members on economic sustainability June 19, 2012 Innovative Funding and Financing Practices: Naming Rights, Tolls, and Other Revenue Sources Dr. Valarie McCall Joseph M. Casey Deborah S. Lipman Dee Leggett

2 Innovative Funding and Financing Practices: Naming Rights, Tolls, and Other Revenue Sources Dr. Valerie McCall APTA Transit Board Members Committee s Region IV Representative & Legislative Subcommittee Vice-Chair, and Member, Board of Trustees, Greater Cleveland Regional Transit Authority, Cleveland, OH

3 Innovative Funding and Financing Practices: Naming Rights, Tolls, and Other Revenue Sources Joseph M. Casey Member, APTA Board of Directors, General Manager, Southeastern Pennsylvania Transportation Authority, Pennsylvania, PA

4 Joseph M. Casey General Manager Southeastern Pennsylvania Transportation Authority Naming Rights Program American Public Transportation Association Webinar June 19, 2012

5 Authority Highlights Six largest transit authority in U.S. Operates Bus, Trolley, Trackless Trolley, Subway-Elevated, Regional Rail and ADA services Provides more than 1 million passenger trips daily 143 bus and rail routes 1,400 buses and 1,300 rail cars 280 passenger stations $1.2 billion operating budget State legislation requires transit agencies to seek and maximize alternative sources of revenue

6 SEPTA Naming Rights Program Overview Means of generating alternative sources of revenue. SEPTA has a comprehensive advertising package including Interior bus and rail cars Exterior bus and rail cars King size wraps Station domination Digital advertising Web advertising Static and electronic billboards Annual advertising revenue budget exceeds $12 million SEPTA, in partnership with Titan Outdoor LLC, the Authority s advertising agency, launched a Naming Rights Program in 2009.

7 SEPTA Naming Rights Program Overview The program gives an advertiser a high profile way to build awareness in their brand. Criteria and components of a Station Naming Rights program will be discussed. Specific experience with naming rights at AT&T Station. Public and community outreach efforts

8 SEPTA Naming Rights Program Elements Program goes far beyond the changing of the name on the exterior of the station. A complete package includes: Advertiser placement on all advertising displays within the station and category exclusivity on any digital displays which rotate through multiple advertisers. Name changed on all signs throughout the station Name changed on all SEPTA maps and schedules in print and online Name changed on all system voice audio recordings referring to the station Short term awareness campaign on media outside the station (bus exterior signage) to promote the new station name.

9 SEPTA Naming Rights Program The sponsor receives All media at the station Ideally exterior (street level) signage should be included when possible Dominant presence throughout

10 SEPTA Naming Rights Program Term and Revenue Minimum length of 5 years with annual revenue increases. Revenue determined by desirability of the station from a ridership and media standpoint. Doubling the current annual media revenue at the station is the minimum goal.

11 SEPTA Naming Rights Program Potential Partners Ideal partners are companies/organizations that have a recognizable brand and connection to the region. Best case scenario the sponsor has a location in close proximity to the station. New companies or recently merged companies often have an interest/need for naming rights sponsorship.

12 SEPTA Naming Rights Program AT and T Station AT&T Station (formerly Pattison Station) on SEPTA s Broad Street Subway Line proved to be an ideal confluence for a Naming Rights Program. AT & T Launching an ambitious rebranding effort with an updated logo and tag line Rethink Possible. Strong retail and advertising presence in the region but were looking for a way to indelibly stamp their new brand in the communities consciousness. Major exposure to SEPTA customers and attendees at Sports Complex events

13 SEPTA Naming Rights Program AT and T Station High profile location that is perfect for a major brand to take advantage of Direct, fast service from Center City Philadelphia Station is located in the heart of Philadelphia's Sports Stadium and Entertainment Complex. The station is surrounded by naming rights sponsorships of those venues. Citizens Bank Park (Phillies) Lincoln Financial Field (Eagles) Wells Fargo Center (Flyers and Sixers) Xfinity Live (Entertainment and Dining) Annual attendance at these venues exceed more than 7 million. Transit Ridership can exceed more than 10,000 for a single event and annually more than 1 million.

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15 SEPTA Naming Rights Program Term and Revenue Entered into a 5 year contract with AT and T. Revenue over the period totals $5.29 million.

16 SEPTA Naming Rights Program Pre-Launch Activities Significant community and political outreach prior to renaming of station Secure support of stakeholders Stress positive financial benefits to Authority, its riders and community No significant opposition to change Develop Ad campaign of traditional transit media along with PR campaign to educate the public on the name change.

17 SEPTA Naming Rights Program AT&T Station The package includes: Wrapping the exterior roof soffits of 4 headhouses with the AT&T Station name and commercial logo

18 SEPTA Naming Rights Program AT&T Station The package includes: Revision of all station signage mentioning the station s name (sample below). before before before after after after

19 SEPTA Naming Rights Program AT&T Station The package includes: Placement on all advertising displays in the station including digital

20 SEPTA Naming Rights Program AT&T Station The package includes: Station name throughout the SEPTA system on maps, schedules and anywhere it appears online

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22 Innovative Funding and Financing Practices: Naming Rights, Tolls, and Other Revenue Sources Deborah S. Lipman Manager, Government Affairs, Metropolitan Washington Airports Authority, Washington, DC

23 Ronald Reagan Washington National Airport Dulles Toll Road Dulles Corridor Metrorail Project Washington Dulles International Airport 23

24 About the Metropolitan Washington Airports Authority Created in 1987 by the Federal Government, with the concurrence of Virginia and the District of Columbia 13 Person Board of Directors 3-Federal 5-Virginia 2-Maryland 3-District of Columbia 24

25 About the Metropolitan Washington Airports Authority (continued) Operator of Washington Dulles International Airport and Ronald Reagan Washington National Airport 2006-Dulles Airport Corridor Agreements with the Commonwealth of Virginia Effective November 1, 2008 Operate and maintain the Dulles Toll Road Design and construct the Dulles Rail Project 25

26 About the Dulles Airport Corridor Land owned by the Federal Government Leased to the Airports Authority until 2067 The Dulles Toll Road is on a series of easements to Virginia Department of Transportation (VDOT) VDOT constructed the Toll Road 28 years ago VDOT operated the Toll Road until transfer in

27 Dulles Airport Corridor Dulles Corridor Metrorail Extension (Future Alignment) Dulles International Airport Access Highway (Non Tolled; Two Lanes in Either Direction) Dulles Toll Road (Four Lanes in Either Direction, Inner lane is HOV Lane) 27 The Dulles Toll Road is an 8 lane, 14 mile (22.7km) highway in Northern Virginia

28 Metrorail Project Overview Seamless integration with current 106-mile Metro system 23-mile extension that branches off existing Orange Line providing direct connections to DC without transfers 11 new stations 5 in Phase 1 6 in Phase 2 Phase 1: East Falls Church to Wiehle Avenue in Reston; scheduled completion-2013 Phase 2: Wiehle Avenue through Dulles Airport to Ashburn; scheduled completion

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30 Key Events Timetable 2005 VDOT Receives five PPP proposals for privatization of the Dulles Toll Road Airports Authority Submits Alternative Public-public proposal to operate Toll Road and build rail MOU between Airports Authority and Commonwealth of Virginia 2006 Master Transfer Agreement and Permit and Operating Agreement Signed (50 year term) Transfer Date (VDOT as Contractor) 2009 Full Operation by Airports Authority 30

31 Key Business Terms Operate, maintain, and improve the Dulles Toll Road for a 50-year term Pay off all remaining Dulles Toll Road debts and loans Segregate toll revenues from other MWAA revenues Design, build, and participate in financing the Metrorail Project Design, build, and finance other capital improvements to the Dulles Corridor with VDOT and regional plan approval Set Toll rates, after public consultation and Board approval, including congestion pricing using established regulatory process 31

32 Public-Public Partner in the Dulles Metrorail Project Finance Construction Operations Metropolitan Washington Airports Authority Commonwealth of Virginia Fairfax County Loudoun County Federal Transit Administration Metropolitan Washington Airports Authority Washington Metropolitan Area Transit Authority (Metro) 32

33 Allocation of Dulles Metrorail Project Costs Excluding Route 28 Station and Phase 2 Parking Garages * Allocation based on 100% Preliminary Engineering Estimate for Phase 2. Assumes Fairfax secures $236 million for the Route 28 station and two parking garages and Loudoun secures $168 million for three parking garages. If the $2.831 billion Independent Cost Estimate with higher assumed escalation is used, the Loudoun contribution is $275 million. Allocation assumes the $150 million to be provided by the Commonwealth of Virginia for Phase 2 will be used to pay interest on Dulles Toll Road revenue bonds, not direct project costs. 11

34 I 66 at the Dulles Connector Road/Orange Line Tie In 34

35 A Tale of a Toll-Road and a Train Dee Leggett Vice President, Communication & Planning Denton County Transportation Authority, Lewisville, TX

36 History of DCTA Election to Establish (2001) Assumption of Bus Service (2005) Groundbreaking for A-train (2009) A-train Revenue Service (2011)

37 DCTA Background: Why So Aggressive? Population and Employment Growth 50,000 plus University Students Ozone Non-Attainment Increased Traffic Congestion Strong Community Support Regional partnership (DART & I-35E) Regional Toll Revenue Financing Initiative (RTRFI)

38 The A-train Project At-a-Glance

39 RTRFI: Background TXDOT granted authority to enter into CDA s Expedite near-term, near-neighbor transportation projects with excess toll revenue 26 miles of SH121 connecting McKinney to DFW identified as a project Private sector ($2.8B) ultimately outbid by NTTA ($3.2B) to finance, design, construct, operate and maintain SH121 for 52 upfront payment split by county years $2.5 billion based on future toll revenues

40 RTRFI: Value of SH 121 Project Up-front Concession Fee $2.50B Excess Revenue Over Time $0.83B Construction of SH 121 $0.69B Future O&M (Net Present Value) $1.30B Profit to NTTA $1.36B $6.68B

41 RTRFI: Timeline and Process The region allocated funds for: Pre-selected Cost Overrun Projects New Projects selected via Project Evaluation Process February 2007: County Task Forces formed April 2007: Initial call for projects June 2007: NTTA selected August 2007: Applications due

42 RTRFI: Timeline and Process Eligible projects: transit, highways, arterial, sustainable development, air quality, and projects impacted by rescissions or cost overruns Emphasis areas: local support, regional significance, partnerships, project need, multimodal, air quality conformity, and congestion management Required 20% match and public agency sponsor

43 RTRFI: Timeline and Process Collaborative project selection process between region and county task forces Denton County received: $659.50M for cost overrun projects $ million for new projects April 2008 & August 2008: 200 projects funded DCTA received: $57.2 million for rail cars (April 2008) $190.2 million for construction (Aug 2008) Interest earned (2010)

44 RTRFI: Funding and Program Challenges New process in Texas, no clear path Regional support but statewide frustrations with TXDOT and toll roads Last minute game changes: Local political pressure to use NTTA vs Cintra Legislative moratorium on future CDAs AG Opinion: no mechanism to transfer funds outside of state treasury (Dec 2008) Advanced Funding Agreement requirements

45 RTRFI: Why it worked for DCTA Perfect timing Local champions Regional relationships Statewide relationships Steadfast and strategic guidance by DCTA Board Clear environmental process Broad public support True grit and determination

46 Transportation Tuesdays Online Sixth in webinar series for transit CEOs & board members on economic sustainability June 19, 2012 Innovative Funding and Financing Practices: Naming Rights, Tolls, and Other Revenue Sources Dr. Valarie McCall Joseph M. Casey Deborah S. Lipman Dee Leggett

47 Transportation Tuesdays Online Sixth in webinar series for transit CEOs & board members on economic sustainability June 19, 2012 The audio and PowerPoint for today s webinar will be available at under Resource Library (top of home page) Professional Development APTA Webcasts, Webinars & Online Training

48 Transportation Tuesdays APTA Executive/Board Webinar Series on Economic Sustainability Six Webinars November 2011 through June 2012 November 8, 2011: Congestion reduction charge & property tax millage December 6, 2011: Election results January 17, 2012: Financing tools March 6, 2012: State commissions April 10, 2012: Public private partnerships June 19, 2012: Road tolls, naming rights and other revenue sources