Request for PR-22 Public-Private Partnership Qualifications



Request for PR-22 Public-Private Partnership Qualifications
Request for PR-22 Public-Private
Partnership Qualifications
Responses due Tuesday, June 3rd, by
3:00 p.m. Atlantic Standard Time
Request for PR-22 Public-Private
Partnership Qualifications
Long-Term Operation and Maintenance Agreement
Responses due Tuesday, June 3, 2008,
by 3:00 PM Atlantic Standard Time
Issued on Friday, April 25, 2008
Table of Contents
Table of Contents
List of Tables
List of Exhibits
Executive Summary
Executive Summary
PRHTA and Toll Road Network Overview
PRHTA Overview
Toll Road Network Overview
PR-22 (José de Diego Highway)
PR-22 Overview
Traffic Volumes & Financial Performance
Capital Expenditure Profile
PR-22 Investment Highlights
PR-22 Investment Highlights
Evaluation Process and Criteria
Bidder Qualification Requirements and Evaluation Criteria
SOQ Submission Requirements
SOQ Submission Requirements
Statement of Qualifications
Format and Required Information for SOQ Submission
Supplemental Legal Materials
Form A – Transmittal Letter
Form B – Eligibility Affidavit
List of Tables
PR-22 Transactions and Revenues by Toll Plaza (FY2007)
PR-22 Financial Performance
List of Exhibits
Organizational Overview
Puerto Rico’s Toll Road Network
Map of PR-22
PR-22 Transaction Volume
PR-22 Historical Capital Expenditures
Illustrative Corporate Investments in Puerto Rico
Comparative Ratio: Vehicles Per Capita
Section 1
Executive Summary
1 Executive Summary
1.1 Executive Summary
The Puerto Rico Highways and Transportation Authority (“PRHTA” or
“Authority”), the Government Development Bank for Puerto Rico (“GDB”),
(as financial advisor and fiscal agent for PRHTA) and the Commonwealth of
Puerto Rico (the “Commonwealth”), are evaluating a long-term Operation
and Maintenance Agreement (“OMA”) for PR-22, José de Diego Highway
(“the Highway”). PR-22, which spans 52 miles from east to west in northern
Puerto Rico, is the Commonwealth’s premier toll road asset and is operated
and maintained by PRHTA. The PR-22 OMA contract term currently being
contemplated is 50 years. Further details regarding the OMA term and
structure will be provided during a later stage of the process.
The Commonwealth expects a successful outcome in the OMA process will
help it reach several key objectives, including:
1) Create a Financial Position of Strength. Execute an OMA that expands
the capacity of the Authority to fund new capital projects and pay down
outstanding debt while creating a model for future highway OMA
projects in Puerto Rico;
2) Build Towards the Comprehensive Beltway. Create momentum for
completing a comprehensive beltway in the Commonwealth that
optimizes traffic flows and ensures public safety;
3) Minimize Near Term Toll/Tax Increases. Codify a future toll rate-setting
schedule that is consistent with the public interest; and
4) Receive Credit Affirmation. Receive a credit rating affirmation or
upgrade on the Authority’s existing toll revenue bond credits.
Government Commitment
to Expedited Process
Private investment is a key element of the Commonwealth’s strategy to
develop a world class transportation infrastructure. Consistent with Puerto
Rico’s Economic Development and Government Transformation Plan, the
Commonwealth is focused on achieving transportation results over the next
six to twelve months. For the PR-22 OMA initiative, financial close is
targeted for October 2008.
Based on a formal review by the Commonwealth’s Secretary of Justice, the
the proposed OMA transaction is authorized under Puerto Rico law.
Specifically, the office of the Secretary of Justice has provided a formal
opinion to the Authority concerning its power to enter into the proposed
OMA. This authorizing opinion will be provided to Qualified Bidders in an
electronic data room during the due diligence phase of the transaction.
1 Executive Summary
Overview of Request for
Qualifications (“RFQ”)
Executive Summary (cont’d)
This Request for Qualifications (“RFQ”) provides interested parties
(“Bidders” or “Teams”) with the opportunity to formally express their interest
in bidding on an OMA for PR-22 and present their qualifications.
Section 2 of this RFQ provides an introductory description of the Authority
and its toll road network. Sections 3 and 4 provide a detailed description of
PR-22 and select highlights of the possible OMA. Section 5 describes the bid
evaluation process and criteria.
Section 6 establishes submission
requirements and procedures for SOQs (“Statements of Qualifications”) and
Section 7 identifies the required contents for the SOQs. Finally, Appendix A
contains supplemental legal materials, including reserved rights, and a form
of the required transmittal letter.
Those interested in participating in the OMA process must respond to this
RFQ by submitting their SOQs to the PRHTA Junta de Subasta no later
than 3:00 PM AST on Tuesday, June 3, 2008.
Based on the SOQs, the Authority’s Board of Awards (as defined below) will
determine those Teams that are qualified to bid. There will be no restriction
as to the number of Bidders that may qualify.
Select Definitions
For the purposes of this RFQ, the following definitions will apply:
• Long-term Operation and Maintenance Agreement (“OMA”) means a
contract between the Authority and a private entity (the “Contractor”) in
which Contractor will: (i) on the closing date, pay PRHTA the upfront
payment amount set forth in its bid (the “Upfront Payment”); and (ii)
operate, maintain, restore and rehabilitate PR-22, pursuant to the
standards and level of service requirements established in the OMA, and
subject to PRHTA primary supervision and control.
Under the OMA, PR-22 toll revenues generated during the term of the
agreement (the “Toll Revenues”) will be used to: (i) pay the Contractor
for operating and maintenance expenses and capital improvements, and (ii)
compensate the Contractor for services rendered and capital invested
(including principal and interest on debt incurred and a return on equity);
• Board of Awards, or “Bid Board” means a 3-member entity of the
Authority (plus 2 alternates) that is ultimately responsible for considering,
receiving, and evaluating bidder proposals;
• PRHTA Evaluation Committee means the committee named by PRHTA
(with Morgan Stanley as Advisor) to process and evaluate the RFQ and the
SOQ, and to make recommendations to the Bid Board;
1 Executive Summary
Executive Summary (cont’d)
• “Team” or “Bidder” means an individual, a company, a joint venture
or a consortium of individuals and/or companies formed to undertake
the transaction; and
• “Team Member” means a member of a Team.
Bidder Registration
Prospective Bidders that anticipate responding to the RFQ are required to
register their intent with the Bid Board as soon as possible by sending an
email to: [email protected]
Please be sure to include the name and address of your company and a
primary point of contact for all future RFQ correspondence. Should you have
questions, please contact: 787-721-8787 x 1129 / x1130.
Ongoing RFQ
The following link will serve as the PR-22 OMA website. Importantly,
additional information, including responses to questions and requests for
clarification, related to the RFQ will be posted at:
Please note that it is the Bidder’s responsibility to periodically check the
website for new information regarding the PR-22 OMA process.
Requests for Clarification,
Questions and Addenda
Bidder’s questions and/or requests for clarification or any other
communication with respect to this RFQ, must be submitted in writing, no
later than Monday, May 19, 2008 at 3:00 PM AST, solely to the Bid Board, at
the following actual or e-mail address:
Junta de Subasta
Puerto Rico Highways and Transportation Authority
Roberto Sánchez Vilella Government Center (Minillas)
Eleventh Floor, South Building
De Diego Avenue, Santurce, Puerto Rico 00940
Via e-mail: [email protected]
Please DO NOT contact any PRHTA or GDB officer, related party or advisor.
Bidders are responsible for ensuring that any written communication clearly
indicates on the first page or in the subject line, as applicable, that the
material relates to the PR-22 OMA process.
PRHTA Evaluation Committee will provide Bidders with responses to
questions and requests for clarifications which it deems to be material and not
adequately addressed in previously provided documents.
PRHTA reserves the right to revise this RFQ by issuing addenda thereto at
any time before the SOQ due date. Bidders who submit SOQs in response to
this RFQ will be required to acknowledge in the transmittal letter (Form A)
that they have received and reviewed all materials provided in connection
with this RFQ, including any addenda.
1 Executive Summary
Overview of Bidding
Executive Summary (cont’d)
Bidders qualified by the Bid Board (“Qualified Bidders”) will be required to
sign a Confidentiality Agreement. Upon execution of a Confidentiality
Agreement, the Commonwealth will provide the opportunity to conduct due
diligence through:
Access to a secure, online data room;
Investor meetings;
Authority management presentations; and
A review and discussion of the Authority’s proposed PR-22 Operation
and Maintenance Agreement and related documents.
During the process, Bidders will be asked to submit preliminary, non-binding
indications of interest for evaluation. Bidders also will have an opportunity to
comment on the proposed OMA and Operating Standards. Bidders will be
provided with more detailed bidding and negotiating procedures and a more
detailed timetable at a later stage of the process. Ultimately, Bidders will
have the opportunity to submit final, binding bids to the Bid Board.
The Bid Board reserves the right to reject any and all SOQs, to waive
technical defects, irregularities or any informality in bids, and to accept or
reject any part of any bid at its discretion. The Bid Board also reserves the
right to postpone the date on which bids are required to be submitted, or to
take any other action it may deem in its best interests.
Section 2
PRHTA and Toll Road Network
2 PRHTA and Toll Road Network Overview
2.1 PRHTA Overview
Organizational Overview
The Authority was created in 1965 to assume responsibility for the
construction of roads, highways, and related transportation facilities in the
Commonwealth. With a 43-year operating history, PRHTA is a separate
entity from the Department of Transportation and Public Works (“the
Department”) for purposes of financing and constructing Puerto Rico’s
transportation system. Since 1971, the Secretary of Transportation and Public
Works (the “Secretary”), appointed by the Governor, has overseen the
management of the Authority and exercises the powers of the Governing
Board of the Authority. The Honorable Carlos González, who is the sixteenth
Secretary, is the current Chairman of the Board of the Authority. The
Authority is led by Luis Trinidad Garay, PE, Executive Director, who
oversees the Authority’s day-to-day operations.
Exhibit 1: Organizational Overview
Department of Transportation and Public Works
Advisory Board
Highways and
Responsibilities of the
Metropolitan Bus
Secretary of
Administration and
Human Resources
Secretary of
Programming and
Ports Authority
Transit Security
Directorate of
Public Works
Directorate of
Driving Services
Directorate of
Urban Planning
Directorate of
The Authority has broad powers to carry out its responsibilities in accordance
with the Department’s overall transportation policies. These powers include,
among other things, the complete control and supervision of any highway and
other transportation facilities owned, operated or constructed by it; the ability
to set tolls and other charges for the use of the highway and other
transportation facilities; and the power to issue bonds, notes and other
obligations. The Authority plans and manages the construction of all major
projects relating to Puerto Rico’s highway transportation system, undertakes
major repairs and maintains the toll highways. The Department maintains
Puerto Rico’s highway system, other than the toll highways, and undertakes
construction of smaller projects.
2 PRHTA and Toll Road Network Overview
2.2 Toll Road Network Overview
The Authority operates and maintains a network of six toll roads - PR-22
(José de Diego), PR-5, PR-20 (Martínez Nadal), PR-52 (Luis A. Ferré), PR66, and PR-53. As outlined in the map below, the Commonwealth’s six toll
roads are important economic drivers and serve as the Island’s primary
interregional transportation routes. Total transaction volume on the six toll
roads equaled 345.1 million transactions in FY2007, resulting in total
revenues of $217.2 million and Earnings before Interest, Taxes, Depreciation
and Amortization (“EBITDA”) of $152.2, a margin of 70.1%
Exhibit 2: Puerto Rico’s Toll Road Network
Major Corporate Investments Highlighted in Green
PR-22 (Extension)
PR-66 (Phase I & II)
Congar Int’l
Maunabo Tunnels
Significant Corporate Facility/Investment
PR-22 (José de Diego)
PR-22 (José de Diego Highway) is a vital component of the Authority’s toll
road network and the OMA candidate that is described in this RFQ. As the
dominant east-west transportation artery in Puerto Rico, PR-22 provides the
most efficient means of traveling between the cities of San Juan and Arecibo,
a distance of 52 miles. Notably, PR-22 runs through a prominent
pharmaceutical and manufacturing corridor where multinational firms such as
Abbott, Eaton, Guidant, Merck, Pfizer, Schering-Plough and others have
significant manufacturing operations. PR-22 enjoys strong competitive
positioning as the only parallel route (PR-2) is a local road that results in an
average travel-time loss of approximately 45 minutes.
PR-22 (José de Diego
One of the long-term transportation priorities of PRHTA is the extension of
PR-22 from its current terminus in Arecibo to the City of Aguadilla on the
west coast. The approximately 27.8 mile extension would complete a
significant step towards achieving a comprehensive beltway. A PR-22
extension is expected to save drivers an estimated 30 minutes in travel time
versus the current non-tolled parallel road (PR-2).
2 PRHTA and Toll Road Network Overview
Toll Road Network Overview (cont’d)
The Environmental Impact Statement (“EIS”) for the PR-22 extension is
currently being evaluated by the Puerto Rico Environmental Quality Board
(“EQB”), other governmental agencies and the public. EQB approval of the
EIS is anticipated in the 2008 calendar year. Upon receipt of formal
approval, extension design and land acquisition processes can commence.
Inaugurated in February 2006, PR-5 is a 2.5 mile toll road located south of
metropolitan San Juan. PR-5 reduces travel time to Bayamón from points
south by approximately 10-15 minutes. The PR-5 extension, which is under
construction at Naranjito Bridge, will increase traffic volume on this route.
PR-20 (Martínez Nadal
PR-20 (Martínez Nadal Expressway) runs six miles to the south of
metropolitan San Juan, providing connectivity between PR-2 and PR-1 near
Caguas. PR-20 provides travelers a means of saving 10-15 minutes versus
the local PR-1 route. PR-20 and PR-5 effectively serve as congestion relief
valves in a high density traffic region.
PR-52 (Luis A. Ferré)
PR-52 (Luis A. Ferré) is the Commonwealth’s longest toll road, running 67
total miles from metropolitan San Juan to Ponce, Puerto Rico’s second largest
city by population. PR-52 has no continuously parallel route due to
mountainous terrain, making it an essential artery for vehicle travel in Puerto
Rico. The Port of the Americas, which is located in Ponce at the southern
terminus of PR-52, is expected to generate additional traffic volume in
coming years as the Port benefits from a major ongoing capital program.
PR-66 (Eastern Corridor)
PR-66, which is the newest of the Commonwealth’s toll roads having opened
in April 2006, connects Carolina to Canóvanas in the northeast region of
Puerto Rico. PR-66 leads to popular recreation locations, such as Belz
Outlets, El Yunque, and other tourist destinations in the northeast. PR-66
also provides a direct route to the Roosevelt Roads Redevelopment Project,
an 8,650 acre former U.S. Naval station that will be converted to a mix of
residential, commercial, and light industrial uses beginning in 2008.
PR-66 (Phase II Extension)
PR-66 (Phase II) will be a 3.8 mile extension of the existing PR-66 route,
connecting Canóvanas to Rio Grande. Completion of PR-66 Phase II is a
high priority capital project for the Authority. Construction on the PR-66
Phase II extension is expected to begin sometime in 2008.
PR-53 runs 37 total miles and is the primary eastern transportation corridor in
Puerto Rico. PR-53 has two completed segments – Fajardo to Yabucoa and
Salinas to Guayama. The completion of the unfinished segment of PR-53
between Yabucoa and Guayama is one of the Authority’s long-term strategic
goals. The tunnels at Maunabo are one segment of the road currently under
construction. When finished, PR-53 will run 53 miles contiguously from
Fajardo to Salinas.
Section 3
PR-22 (José de Diego Highway)
3 PR-22 (José de Diego Highway)
3.1 PR-22 Overview
PR-22 is the central artery in the Puerto Rico transportation network and is a
result of sustained investment by the Commonwealth for over 20 years. As a
limited-access, multi-lane toll expressway, the José de Diego Highway was
conceptualized by the Authority in the 1960s to facilitate improved traffic
flows in the high-density northern region of Puerto Rico. In particular, PR22’s main users were expected to be long-haul commercial vehicles as well as
commuters destined for the San Juan metropolitan area.
In 1963, public hearings were held for the construction of PR-22. The
original alignment, interchanges and tolls for the San Juan to Arecibo route
were adopted subsequent to the hearings. With additional feasibility studies
completed in 1969, the Authority examined viable engineering and funding
alternatives to initiate construction of the expressway. After comprehensive
review, the Authority began construction of PR-22 and opened the first
section of the road to the traveling public on November 28, 1971. This
inaugural route consisted of a 3.5 mile segment that extends west, from San
Juan to the Bayamon River.
Simultaneously, the Authority began
construction on the western portion of PR-22 near Arecibo.
In the following decades, Puerto Rico’s northern corridor underwent rapid
urbanization and economic development. To complement the expansion and
development, two key portions of PR-22 were completed and opened to
traffic: (1) San Juan to PR-165 (Toa Baja) which runs approximately 11
miles, and (2) Arecibo Ramp to Arecibo, spanning nearly 13.5 miles.
However, the remaining 26.5 miles of the envisioned expressway, running
from Toa Baja to Arecibo Ramp, had yet to be constructed.
To this end, the Authority conducted PR-22 location studies to determine the
optimal route of this remaining portion of the road. The section, which
transverses a number of wetlands, rivers, and floodplains, required heightened
engineering and technical expertise. As a result of the unique topography,
new and innovative bridge construction techniques were utilized in the
construction process. Ultimately, PR-22’s final segments were opened in the
early 1980s.
Today, a complete and fully operational PR-22 is a visible symbol of the
Authority’s ongoing commitment to improve transportation efficiency on the
Island and, ultimately, complete a comprehensive beltway for its citizens.
With the continual reinvestment of capital, the implementation of modern
materials and systems, and the potential PR-22 extension from Arecibo to
Aguadilla, PR-22’s place as a key component in Puerto Rico’s transportation
infrastructure remains certain in the years to come.
3 PR-22 (José de Diego Highway)
PR-22 Overview (cont’d)
Currently, PR-22 consists of one continuous route from the City of San Juan
(population of 442,447)1 to the City of Arecibo (population of 104,600). The
expressway provides safe, high-speed access for both short and long-distance
trips along this northern corridor. PR-22 has a total of seven fare collection
facilities: Buchanan, Toa Baja, Vega Alta, Manatí, Arecibo, Arecibo Ramp,
and Hatillo Ramp. The speed limit across the Highway ranges from 55 to 65
miles per hour.
Exhibit 3: Map of PR-22
Northern Puerto Rico
Proposed 27.8 Mile Extension
Operation Details
Existing 52 mile route (San Juan to Arecibo)
In FY2007, PR-22 processed 157.3 million transactions, resulting in nearly
$91 million of total revenues. The table below provides summary transaction
and revenue data by toll plaza. The adjacent columns highlight the stable and
sustained growth trends observed since FY2000.
Table 1: PR-22 Transactions and Revenues by Toll Plaza (FY2007)
Toll Plaza
Volume (Mn)
Transaction Volume
CAGR (2000-2007)
Revenue ($Mn)
Revenue CAGR
Toa Baja
Vega Alta
Arecibo Ramp
Hatillo Ramp
1. 2000 Census
3 PR-22 (José de Diego Highway)
3.2 Traffic Volumes & Financial Performance
Historical Traffic Volume
PR-22’s seven toll-collection facilities process traffic flows on the Highway.
The chart below depicts PR-22’s 1.9% compound annual traffic volume
growth since FY2000, with toll booths being listed in order of proximity to
San Juan (Buchanan is the nearest, while Hatillo Ramp is the furthest). From
FY2000 to FY2005, compound transaction volume growth was 3.8%.
On September 10, 2005, after conducting public hearings, the Authority
increased toll rates on PR-22 for the first time in fourteen years. The total
roundtrip toll for a two-axle vehicle increased from $4.65 to $6.75, an
increase of 45.2%. With this sizable toll increase, PR-22 traffic volumes
decreased 5.9% in FY2006. However, in FY2007, traffic volumes rebounded
with 0.6% growth, illustrating PR-22’s essential role and strategic route.
Exhibit 4: PR-22 Transaction Volume
5.9% decline after
9/2005 toll increase
3.8% compound annual
growth FY 2000-FY2005
0.6% growth
in FY2007
Electronic Toll Collection
Toa Baja
Vega Alta
Arecibo Ramp
Hatillo Ramp
Puerto Rico Highways & Transportation Authority, Applied Research, Inc.
In March 2004, the Authority began implementing AutoExpreso on its toll
roads, including PR-22. AutoExpreso is a high-speed electronic toll
collection system that employs radio transmissions from transponderequipped vehicles to plaza-mounted antennas, and video systems for violation
enforcement. AutoExpreso has exceeded the Authority’s usage and
performance expectations. It has significantly increased vehicle circulation
throughout toll plazas and has resulted in reduced travel time and increased
convenience for customers.
3 PR-22 (José de Diego Highway)
Traffic Volumes & Financial Performance
Direct benefits to the Authority include reduced cost of manual toll
collection, enhanced auditing capabilities, additional payment options
offering and receipt of toll payments in advance. As of November 2007,
AutoExpreso had been implemented on sixteen of the twenty-four existing
toll stations in the broader toll road network. On PR-22, AutoExpreso is now
operational at six of the seven fare collection facilities. With ongoing
initiatives to convert regular AutoExpreso lanes to high-speed AutoExpreso
lanes, traffic flows continue to be optimized as toll-violations are minimized.
Historical Financial
Table 2: PR-22 Financial Performance
FY Ending 6/30 ($Mn)
Toll Revenues
% Growth
Operating Expenses
% Growth
% Margin
Source: Puerto Rico Highways and Transportation Authority
Authority Operating Expenses allocated by transaction volume
PR-22’s financial performance is characterized by stable, growing revenue
collection and healthy cash flow margins. Since FY2002, PR-22 has
achieved an average EBITDA margin of 69.5%.
PR-22 revenues have an average growth rate of 8.2% since FY2002, with the
most significant increase resulting from the implementation of a system-wide
toll increase in FY2006. On the expense side, payroll, toll booth
administration and AutoExpreso costs are the main components of PR-22’s
operating cost structure. The increase in operating expenses observed in
FY2005-FY2007 was largely a result of start-up AutoExpreso costs. Over
time, it is anticipated that AutoExpreso will lead to reduced operating
expenses as volume increases are achieved through electronic toll collection.
3 PR-22 (José de Diego Highway)
3.3 Capital Expenditure Profile
As a matter of policy, the Authority continually invests significant capital into
the Commonwealth transportation network, including its highways, local
roads, mass transit and other essential programs. As part of this continual
investment, the Authority maintains a targeted ongoing capital improvement
program for its toll roads, including PR-22.
The table below displays PR-22’s capital expenditure profile from FY2002 to
FY2007. During these years, the Authority invested nearly $100 million in
capital improvements for PR-22.
Major investments were made in
refurbishing toll plazas, repaving surfaces and general road improvements,
including select lane widening projects.
Exhibit 5: PR-22 Historical Capital Expenditures
PR-22 Capital Expenditures
Puerto Rico Highways & Transportation Authority
Section 4
PR-22 Investment Highlights
4 PR-22 Investment Highlights
4.1 PR-22 Investment Highlights
PRHTA believes that a long-term Operation and Maintenance Agreement for
PR-22 represents an attractive and strategically favorable infrastructure
investment opportunity. The transaction would be a landmark Operation and
Maintenance Agreement in the Commonwealth and provides potential Teams
with an opportunity to invest in a vital segment of Puerto Rico’s
transportation network. Key investment considerations include:
™ Favorable Investment Climate
™ Vital Component of the Puerto Rico Transportation Network
™ High Vehicle Density
™ Advanced Tolling Systems; and
™ Recent Investments to Improve/Modernize Road Conditions.
Favorable Investment
As a self-governing territory of the United States with Commonwealth-status,
Puerto Rico shares in the benefits and protections of U.S. legal and regulatory
regimes. Combining this stable overarching framework with a strong base of
multinational companies, a highly educated bi-lingual workforce and the best
physical infrastructure in the Caribbean, Puerto Rico is a strong candidate for
private investment. As a testament its favorable economics, skilled workers,
and an increasingly knowledge-based economy, Puerto Rico produces sixteen
of the top twenty U.S. pharmaceutical products.
Exhibit 6: Illustrative Corporate Investments in Puerto Rico
Vital Component of the
Puerto Rico Transportation
Puerto Rico Industrial Development Corporation
PR-22 is essential to the Authority’s toll road network. As the dominant eastwest transportation artery in Puerto Rico, PR-22 provides the most efficient
means of traveling between the cities of San Juan and Arecibo, a distance of
52 miles. Notably, PR-22 runs through a dominant pharmaceutical and
manufacturing corridor where multinational firms such as Abbott, Eaton,
Guidant, Merck, Pfizer, Schering-Plough and others have significant
manufacturing operations. PR-22 enjoys strong competitive positioning, with
the only parallel route (PR-2) being a local road that results in a total traveltime loss of approximately 45 minutes.
4 PR-22 Investment Highlights
High Vehicle Density
PR-22 Investment Highlights (cont’d)
The Commonwealth’s ratio of vehicles per capita significantly outpaces the
continental United States and is one of the highest in the world. In 2007,
Puerto Rico registered 0.57 cars per capita versus 0.46 in the mainland U.S.
and 0.46 in Western Europe. A high concentration of cars combined with
2.7% annual growth in registered vehicles from FY2000 to FY2006 provides
predictable demand.
Exhibit 7: Comparative Ratio: Vehicles Per Capita
Puerto Rico vs. Mainland U.S. and Western Europe
Western Europe
United States
Puerto Rico
Euromonitor International 2007
Advanced Tolling
PR-22 has benefited from the Authority’s modernization initiatives to
improve overall highway system operations.
AutoExpreso, the
Commonwealth’s high-speed electronic toll collection system, is now
operational at six of PR-22’s seven fare collection facilities. With ongoing
initiatives to convert regular AutoExpreso lanes to high-speed AutoExpreso
lanes, traffic flows continue to be optimized as toll-violations are minimized.
Recent Investments to
Improve/Modernize Road
From FY2002 to FY2007, the Authority invested nearly $100 million into
capital improvements for PR-22. Notable and completed capital projects
include the construction and rehabilitation of off-ramps as well as the
integration of Superpave asphalt into ongoing repaving operations.
Importantly, these pavement materials have a relatively long useful life given
Puerto Rico’s favorable climate and the fact that a period of severe
temperature fluctuation (e.g., ice, snow) does not occur in Commonwealth.
Section 5
Evaluation Process and Criteria
5 Evaluation Process and Criteria
5.1 Bidder Qualification Requirements and
Evaluation Criteria
This RFQ is open to prospective Bidders who desire to be qualified to bid on
the OMA. Acceptance to the process will be based on a determination by the
Bid Board that Bidders have met the requirements highlighted.
Each SOQ will be reviewed by the PRHTA Evaluation Committee for: (a)
minor irregularities and apparent clerical mistakes which are unrelated to the
substantive content of the SOQ, (b) conformance to the RFQ instructions
regarding organization and format, and (c) the responsiveness of the Bidder to
the requirements set forth in this RFQ.
In addition, the PRHTA Evaluation Committee will review each SOQ to
determine whether the Bidder meets the following responsibility
a) That the SOQ contains an original executed Transmittal Letter
(Form A) and an original executed Eligibility Affidavit (Form B),
both of which are included as part of Appendix A. Please note that
if the affidavit is originated in the states, territories or possessions of
the United States of America, the legalization of the documents shall
be done by an official authorized for such purposes and evidence of
the power awarded to such official by the appropriate authority shall
be presented. Such evidence shall consist of a certification from the
County Clerk or the Department of State;
b) That neither the Bidder nor any other Team Member has been
disqualified, removed, debarred or suspended from performing or
bidding on work for the federal government, the Commonwealth or
any state or local government where such disqualification, removal,
debarment or suspension would preclude selection and award under
applicable law; and
c) That the Bidder is either incorporated in or, if a foreign business
entity, is qualified to do business in, Puerto Rico, and has met all
other legal requirements to do business in Puerto Rico (or expects to
do so prior to submission of a Bid). In particular, please note that
Bidders, prior to submitting a binding proposal (but not prior to
responding to this RFQ), must be registered with the Bidder’s
Registry of the General Services Administration, pursuant to the
provisions of Law 164 of July 23, 1974, as amended, 3 LPRA
932. It is advised that Bidders allow ample time to complete this
Any Bidder may be excluded from further consideration if its SOQ does not
demonstrate that it has satisfied, or will satisfy, these responsibility
requirements. At the end of this review, the PRHTA Evaluation Committee
5 Evaluation Process and Criteria
Bidder Qualification Requirements and
Evaluation Criteria (cont’d)
will assess each Team’s qualifications in the areas of technical capability and
financial capability with respect to the criteria set forth in this RFQ. Those
SOQs not responsive to this RFQ may be excluded from further consideration
and the affected Bidders will be so advised. Bidders whose SOQ contains a
material misrepresentation may also be excluded from consideration.
There will be no restriction as to the number of Teams that may qualify to
bid. Once qualified, process participants will remain qualified until a
Contractor is selected or the OMA process is terminated. Any changes in the
composition of a Team are subject to the prior approval of the Bid Board.
Technical Capability
The evaluation of technical capabilities will address whether the SOQ
submission adequately demonstrates the Team’s technical capability
necessary to operate and maintain a premier toll road with respect to the
following areas of expertise:
Financial Capability
Highway operation and maintenance;
Toll collection and management;
Capital improvements; and
The evaluation of financial capabilities will address whether the SOQ
submission adequately responds to the financial capability requirements of
this RFQ with respect to the following areas:
1) Financial capacity to pay an upfront payment and ability to
operate and maintain PR-22 to PRHTA’s standards; and
2) Ability to raise financing.
PRHTA Requests for
Clarification or Information
At various times during the deliberations, the PRHTA Evaluation Committee
may issue one or more requests for written clarification to the individual
Bidders. The PRHTA Evaluation Committee may also schedule interviews or
discussions with one or more Bidders on a one-on-one basis, for the purpose
of enhancing the understanding of the SOQs and obtaining clarifications of
the terms contained in the SOQs.
The PRHTA Evaluation Committee may at any time request additional
information or clarification from the Bidder or may request the Bidder to
verify or certify certain aspects of its SOQ. If required, interviews or
discussions shall be scheduled at a later date. Bidders may be required to
submit written confirmation of any new information and clarifications
provided during any interview or discussion. Upon receipt of requested
clarifications and additional information as described above, if any, the SOQs
will be evaluated to factor in the clarifications and additional information.
5 Evaluation Process and Criteria
Bidder Qualification Requirements and
Evaluation Criteria (cont’d)
Following submittal of the SOQs, the following actions may not be
undertaken without PRHTA’s prior written consent:
• Deletion or substitution of a Team member identified in the SOQ;
• Deletion or substitution of an equity owner of Bidder, a guarantor of
Bidder or any other entity that will bear financial responsibility or
liability for the performance of the Bidder; and
• Other changes in the equity ownership or team membership of a Bidder.
PRHTA, in its sole discretion, may allow changes in the composition of a
Bidder (e.g. joint venture, contractors, etc.) after the Qualified Bidders have
been identified, provided that all qualifications requirements are satisfied for
any new Team Member.
Section 6
SOQ Submission Requirements
6 SOQ Submission Requirements
6.1 SOQ Submission Requirements
Advisors to PRHTA
and GDB
The following firms are serving as advisors or consultants to PRHTA and/or
GDB and are not available to provide services to any Bidders or to participate
as members of any Teams:
• Morgan Stanley & Co., Incorporated;
• Popular Securities;
• Laurie Mahon;
• URS Caribe LLP;
• Nossaman Guthner Knox & Elliott LLP;
• Nixon Peabody; and
• Fiddler González & Rodríguez, P.S.C.
All Bidders should assume that any information submitted as part of the RFQ
response process may be made public at the discretion of PRHTA. Bidders
are hereby notified that all information submitted as part of, or in support of,
both the SOQs and any bids may be subject to public inspection after opening
of bids, in compliance with Art. 409 of the Code of Civil Procedure of Puerto
Rico, 32 LPRA 1781. It is the responsibility of the Bidders to be thoroughly
informed and familiar with the requirements of this statute. Confidential
information which a Bidder wishes to be withheld from the public must be
clearly exempted under this statute or other applicable law.
SOQ Submission
Six hard copies of the SOQ submission along with one copy on two CDs
should be delivered to the Bid Board at the addresses shown below no later
than 3:00 PM AST on Tuesday, June 3, 2008.
Please deliver 6 SOQ hard copies along with one copy on two CDs to:
Junta de Subasta
Puerto Rico Highways and Transportation Authority
Roberto Sánchez Vilella Government Center (Minillas)
Eleventh Floor, South Building
De Diego Avenue, Santurce, Puerto Rico 00940
Additionally, to confirm timely delivery, please send a final electronic copy
of the SOQ submission in Portable Document Format (“PDF”) via e-mail to:
[email protected]
6 SOQ Submission Requirements
No Liability for Costs
SOQ Submission Requirements (cont’d)
The Commonwealth, PRHTA, GDB and their advisors are not responsible for
costs or damages incurred by Bidders, Teams, Team Members,
subcontractors, or other interested parties in connection with the bidding
process, including but not limited to costs associated with preparing
responses, qualifications, and proposals, and of participating in any
conferences, oral presentations, or negotiations, or the exercise of PRHTA of
its reserved rights as specified in this RFQ.
The requirements of article 8.012A of Law 41 of December 20, 1977, 16
LPRA 3362 are applicable to this process. Bidders should familiarize
themselves with its provisions, and the legal consequences of being in
violation of such statute.
Section 7
Statement of Qualifications
7 Statement of Qualifications
7.1 Format and Required Information for
SOQ Submission
All SOQ submissions must comply with the format and content requirements
set forth below:
Cover Page
Transmittal Letter
Table of Contents
Executive Summary (Optional)
Team Information
1) Description of Bidder: Provide a description of the Team, including
a complete identification of the Bidder and each Team Member (both
equity and non-equity), including the legal name, form and state or
jurisdiction where organized, and the anticipated legal relationship
(governance and capital structure) among the Team Members (e.g.,
contractors, shareholders, consultants, etc.) as appropriate.
2) Roles of Team Members and Key Personnel: Briefly outline the
roles of the Team Members and key personnel. In doing so, please
ensure that all the requirements as detailed in Section 5 are addressed.
Describe the Bidder’s management structure, including teaming
3) Operator: Specifically identify the entity or entities that will act as
private operator of the facilities under the proposed OMA.
4) Major Interest: Identify the individuals or companies who hold a
major (>10%) or controlling interest in each Team Member.
5) Required Approvals: Provide a description of any corporate,
shareholder, regulatory or other approvals or consents, contingencies
and any other material conditions required to close the transaction
(including any financing conditions) for each Team Member.
6) Expected Advisors: Identify the companies and individuals who are
expected to act as legal, financial, or other advisors for the Team.
7) Relevant Experience: Provide a list of comparable projects in which
Team Members have participated. Bidders should specify how these
comparable projects relate to the proposed PR-22 OMA.
8) References: Provide a list of Team Member references, including for
projects listed in response to paragraph 7 above. These references
should be able to describe the relevant qualifications and capabilities
of Team Members looking to take a leading role in the operation and
maintenance of the Highway.
9) Legal Qualifications: The following information regarding legal
issues affecting the Bidder and its Team Members shall be submitted:
7 Statement of Qualifications
Format and Required Information for
SOQ Submission (cont’d)
a) Identify and explain any significant anticipated legal issues which
the Bidder must resolve in order to carry out the OMA;
b) Provide a list and a description of all instances during the last five
years involving contracts in which the Bidder (or any other
organization that is under common ownership with the Bidder) or
any Team Member was (i) determined, pursuant to a final
determination in a court of law, arbitration proceeding or other
dispute resolution proceeding, to be liable for a material breach of
contract or (ii) terminated for cause. For each instance, identify
the owner’s representative and, if different, the prevailing party’s
representative with a current phone and fax number (and e-mail
address if available); and
c) Provide a list and a description (including the resolution) of each
arbitration, litigation, dispute review board and other dispute
resolution proceeding occurring during the last five years
involving Bidder (or any other organization that is under common
ownership with the Bidder) or any Team Member and involving
an amount in excess of $25,000,000.
Failure to provide this information, conditional or qualified
submissions (i.e., “to our knowledge”, “to the extent of available
information”, “such information is not readily available”, “such
information is not maintained in the manner requested”, etc.) to
requests or questions posed, incomplete or inaccurate submissions or
non-responsive submissions, or failure to provide information
enabling PRHTA or its advisors or other representatives to contact
owner or prevailing party representatives may, in the sole discretion
of the Bid Board, lead to disqualification from the OMA process.
10) Contact Person: Provide a single contact person for all future
communication between the Bid Board (or its advisors) and the Team.
Please identify the contact person’s name, title, organization, work
address, email address, and work, cell and fax numbers.
F) Technical Capability
Teams should address the following areas:
1) Operations and Maintenance Expertise: Teams must provide
evidence demonstrating their ability to operate and maintain a project
of this nature and scope. Specifically, the Team should have:
a) Substantial high-volume, toll-facility maintenance and operation
experience. At a minimum, Teams must presently maintain and
operate 50 miles of toll roads, tunnels, or bridges. To address this
qualification, please include current miles under management and
7 Statement of Qualifications
Format and Required Information for
SOQ Submission (cont’d)
provide corresponding traffic volumes on these road, tunnel
and/or bridge facilities;
b) Advanced knowledge of highway maintenance, repair,
construction, and practical application of equipment and materials
in toll-facility operations;
c) Demonstrated understanding in highway-aging behavior to assess
and determine the applicability of remedial-maintenance action
over time;
d) All the capabilities necessary to successfully operate and maintain
PR-22 including routine facility and equipment maintenance,
operations and tolling management and operations, administration
and public relations, and emergency operations; and
e) The Bidder’s approach to management of operations, including
toll collection, safety and security, enforcement, facility
maintenance, technology enhancement, public relations, and
liaison activities with PRHTA and other governmental agencies or
2) Toll Collection and Management: Teams must demonstrate their
capability to collect tolls and manage toll revenues efficiently.
Specifically, the Team should have:
a) Substantial high-volume experience with collection of tolls,
including both manual and electronic toll collection systems.
Please include details regarding the number and type of such
systems used as well as details regarding the number of personnel
involved in toll collection and management operations;
b) Experience in toll enforcement and cooperation with law
enforcement; and
c) Capabilities with controls and financial management needed to
manage the collection of tolls and handling of toll revenues.
Please include examples of past projects for which such controls
and management practices were implemented.
3) Customer Service: Teams must demonstrate their commitment to
achieving the highest standards of customer service and satisfaction.
Specifically, the Team must highlight their experience and
qualifications in the following areas:
a) Substantial high-volume, toll-facility maintenance and operation
experience while maintaining productive ongoing relationships
with government entities; and
b) Providing excellent customer service to the traveling public.
7 Statement of Qualifications
Format and Required Information for
SOQ Submission (cont’d)
4) Safety: Teams must demonstrate their ability to address and resolve
safety issues. Specifically, the Team should have:
a) Knowledge of highway safety strategies and methodologies;
b) Experience in emergency response support; and
c) Background in relevant traffic engineering standards,
specifications, policies, practices, and processes.
5) Capital Improvements: Bidders must describe their ability to
undertake capital improvements required to maintain the existing
facilities. Please include details regarding knowledge of and
experience with key surface transportation industry standards, such as
those promulgated by the American Association of State Highway
and Transportation Officials (“AASHTO”) and contained within Title
23 of the U.S. Code.
G) Financial Capability
Teams shall address the following areas:
1) Financial Capacity to Pay Upfront Payment and Maintain PR-22:
Teams must demonstrate their financial capacity to pay the expected
equity portion of the up-front payment and to maintain the Highway
for the term of the OMA. To demonstrate sufficient financial
capacity, Team Members (including operating partners) must provide
copies of audited financial statements for the past two years, together
with any other relevant financial information. If audited financial
statements cannot be provided, Team Members should provide
enough financial information to demonstrate that they have the
financial resources and credit quality to successfully execute a project
of this nature and scope. Financial factors which will be assessed
a) Adequacy of equity;
b) Profitability;
c) Availability of liquid equity;
d) Debt/capitalization and interest coverage ratios; and
e) Demands from other toll road and infrastructure projects.
2) Ability to Raise Financing: Teams must provide specific evidence
demonstrating their ability to raise financing for a project of this
nature and scope. Specific factors that will be assessed include:
a) Capability of raising debt and equity in the current capital market;
b) The number and size of past relevant transactions; and
c) Specific experiences on past relevant transactions.
Appendix A
Supplemental Legal Materials
A Supplemental Legal Materials
Supplemental Legal Materials
Reserved Rights
In connection with this proposed OMA, PRHTA reserves to itself all rights
(which rights shall be exercisable by PRHTA in its sole discretion) available
to it under the Code and applicable laws and regulations, including without
limitation, with or without cause and with or without notice, the right to:
Modify the OMA process in its sole discretion to address applicable
law and/or the best interests of PRHTA, GDB and the
Develop the OMA in any manner that it, in its sole discretion, deems
necessary. If PRHTA is unable to negotiate an OMA to its
satisfaction with a Bidder, it may negotiate with the next highest
ranked Bidder, terminate the OMA process and pursue other
alternatives relating to the OMA or exercise such other rights under
the Code and other provisions of the Code as it deems appropriate.
Cancel the process, as applicable, in whole or in part at any time prior
to the execution by PRHTA of an agreement, without incurring any
cost obligations or liabilities.
Issue a new RFQ after withdrawal of this RFQ.
Reject any and all submittals, responses and SOQs received at any
Modify all dates set or projected in this RFQ.
Terminate evaluations of responses received at any time.
Exclude any potential Bidder from submitting any response to the
RFQ or bid, as the case may be, based on failure to comply with any
Suspend and terminate negotiations at any time, elect not to
commence negotiations with any responding Bidder and engage in
negotiations with other than the highest ranked Bidder.
Issue addenda, supplements and modifications to this RFQ.
Appoint evaluation committees to review SOQs, make
recommendations to appropriate officials and seek the assistance of
outside technical experts and consultants in SOQ evaluation.
Require confirmation of information furnished by a Bidder, require
additional information from a Bidder concerning its SOQ and require
additional evidence of qualifications to perform the work described in
this RFQ.
Seek or obtain data from any source that has the potential to improve
the understanding and evaluation of the responses to this RFQ.
Add or delete Bidder responsibilities from the information contained
in this RFQ or any subsequent process instruments.
Negotiate with a Bidder without being bound by any provision in its
A Supplemental Legal Materials
Supplemental Legal Materials (cont’d)
Waive deficiencies in a SOQ, accept and review a non-conforming
SOQ or permit clarifications or supplements to a SOQ.
Disqualify any Bidder that changes its submittal without the Bid
Board’s approval.
Disqualify any Bidder under this RFQ, or at any time during the
process for violating any rules or requirements of the OMA process
set forth in this RFQ or in any other communication from or to the
Bid Board.
Award one or more contracts for the entire PR-22 OMA, for any
segments, or portions thereof, in the Bid Board’s sole discretion.
Add or eliminate facility expansion to or from the Project.
Not issue a notice to proceed after execution of any contract; and
Exercise any other right reserved or afforded to PRHTA under this
This RFQ does not commit PRHTA to enter into a contract or proceed with
the OMA as described herein. Except as expressly set forth herein, PRHTA,
the GDB, and the Commonwealth assume no obligations, responsibilities, and
liabilities, fiscal or otherwise, to reimburse all or part of the costs incurred or
alleged to have been incurred by parties considering a response to and/or
responding to this RFQ, or in considering or making any submission or Bid.
All of such costs shall be borne solely by each Bidder.
In no event shall PRHTA be bound by, or liable for, any obligations with
respect to the OMA until such time (if at all) as a contract, in form and
substance satisfactory to PRHTA, has been executed and authorized by
PRHTA and, then, only to the extent set forth therein.
The requirements of Art. 409 of the Code of Civil Procedure of Puerto Rico,
32 LPRA. 1781, are applicable to this process. Bidders should familiarize
themselves with its provisions. A Bidder which reasonably believes that
certain information submitted in its SOQ is not subject to disclosure under the
statute or other applicable laws or regulations should specifically and
conspicuously designate that information as such by placing
“CONFIDENTIAL” in the header or footer of each such page affected.
Nothing contained in this provision, however, shall modify or amend
requirements and obligations imposed on PRHTA or its designee by the
statute or other applicable law or regulation. In no event shall PRHTA or its
designee, or any of their agents, representatives, consultants, directors,
officers or employees be liable to a Bidder or Bidder team member for the
disclosure of all or a portion of a SOQ submitted under this RFQ.
All written correspondence, exhibits, reports, printed material, photographs,
tapes, electronic disks, and other graphic and visual aids submitted to the Bid
A Supplemental Legal Materials
Supplemental Legal Materials (cont’d)
Board during this process, including as part of the response to this RFQ,
become the property of PRHTA upon receipt and will not be returned to the
submitting parties.
Organizational Conflicts of
The Bidders must familiarize themselves and be aware of the provisions of
Act. Num. 84 of June 18, 202, as amended (3 LPRA §1755-1761) regulating
conflict of interest. Under this Act, Bidders will have to certify that they
don’t have any conflicts of interest with any branch of the Commonwealth.
Any such conflict may be sufficient grounds to disqualify any Bidder. It is
the Bidders sole responsibility to be aware of the terms and conditions under
which any such conflict may or could arise under the previously-mentioned
A Supplemental Legal Materials
Form A – Transmittal Letter
[Insert Name]
SOQ Date:
[Insert Date]
Junta de Subasta
Puerto Rico Highways and Transportation Authority
Roberto Sánchez Vilella Government Center (Minillas)
Eleventh Floor, South Building
De Diego Avenue, Santurce, Puerto Rico 00940
Dear [Insert Name]:
The undersigned (“Bidder”) submits this statement of qualifications (this “SOQ”) in
response to that certain Request for Qualifications dated as of April 25, 2008 (as
amended, the “RFQ”), issued by the Government Development Bank for Puerto Rico and
the Puerto Rico Highways and Transportation Authority (“PRHTA”) to provide for the
monetization of tolls and the long-term operation and maintenance of PR-22 (referred to
herein as the “PR-22 OMA” or the “OMA”). Initially capitalized terms not otherwise
defined herein shall have the meanings set forth in the RFQ.
Bidder acknowledges receipt, understanding and full consideration of the RFQ, all
addenda, and all other necessary information available from PRHTA as of the date of this
letter, and the following addenda and sets of questions and answers to the RFQ:
[Bidder to list each addendum to this RFQ and each set of questions and
answers, by date and number prior to executing this Form A]
Bidder represents and warrants that it has read the RFQ and agrees to abide by the
contents and terms of the RFQ and the SOQ.
Bidder understands that PRHTA is not bound to accept any Bidder as qualified and may
reject any SOQ received.
Bidder further understands that all costs and expenses incurred by it in preparing this
SOQ and participating in the process will be borne solely by the Bidder.
Bidder agrees that PRHTA will not be responsible for any errors, omissions, inaccuracies
or incomplete statements in this SOQ.
This SOQ shall be governed by and construed in all respects according to the laws of the
Commonwealth and the terms of the RFQ.
Bidder's business address:
(Floor or Suite)
(State or Territory)
(ZIP or Postal Code) (Country)
State or Country of Incorporation/Formation/Organization: ______________
Insert appropriate signature block for signature by a person duly authorized to bind the
A Supplemental Legal Materials
Form B – Eligibility Affidavit
of legal age and resident of
(President or authorized official of bidder)
certify under penalty or perjury, that except as noted below
or any person associated therewith in the capacity of owner,
(Company Name)
partner, director, officer, principal, project director, manager, auditor or any position
involving administration of Commonwealth federal funds
• is not currently under suspension, debarment, voluntary exclusion, or determination of
ineligibility by any federal agency;
• has not been suspended, debarred, voluntarily excluded or determined ineligible by
any federal agency within the past three (3) years;
• does not have a proposed debarment pending; and
• has not been convicted or plead guilty in federal or Commonwealth forum, in any
other jurisdiction of the United States, or in any other country, for the commission of:
aggravated misappropriation, in all its modalities; extortion; construction fraud; fraud
in the execution of construction works; fraud in the delivery of goods; undue
intervention in the processes of awarding bids or in government operations; bribery, in
all its modalities; aggravated bribery; offer to bribe; undue influence; crimes against
public funds; preparation of forged documents; presentation of forged documents;
forgery of documents; or, possession and transfer of forged documents. For the
purposes of the federal jurisdiction, that of the states and territories of the United
States, or of any other country, the prohibition set forth in this provision shall apply in
cases of convictions for crimes whose constitute elements are equivalent to those of
the above stated crimes.
Exceptions to the above are as follows:
(Note here all exceptions indicating for each to whom it applies, the initiation agency,
and dates of action).
(Corporate Seal)
(Name and Title)
Affidavit #
A Supplemental Legal Materials
Form B – Eligibility Affidavit
Sworn to and subscribed before me by
of legal age, contractor and resident of
personally known to me, or identify by
day of
Puerto Rico on this
Notary Public
Note: Exceptions will not necessarily result in denial of award but will be considered in
determining bidder responsibility. Providing false information may result in criminal
prosecution or administrative sanctions.