TITLE
RESOLUTION WAIVING COMPETITIVE BIDDING AND AUTHORIZING THE MAYOR OR DESIGNEE TO EXECUTE AN AGREEMENT WITH FLORIDA EAST COAST RAILWAY, LLC (''FEC'') TO ALLOW THE FEC TO OVERSEE ON THE COUNTY'S BEHALF CERTAIN REPAIRS AND IMPROVEMENTS TO RAIL FACILITIES AT THE PORT OF MIAMI

BODY
WHEREAS, this Board desires to accomplish the purposes outlined in the accompanying memorandum, a copy which is incorporated herein by reference, and

WHEREAS, Section 125.012 of the Florida Statutes authorizes the County to enter into contracts for design and construction of Port facilities with users and providers of the Port;

NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA, that:

Section 1. The foregoing recital is incorporated in this resolution and is approved.

Section 2. This Board hereby finds that it is in the best interest of the County to waive competitive bidding pursuant to Section 5.03(d) of the Charter to allow the County to contract with FEC, a user of the Port, to construct certain port improvements.

Section 3. The Board authorizes the County Mayor or County Mayor�s designee to execute the Rail Bridge Construction Administration Agreement with the FEC (the �Rail Bridge Agreement�) substantially in the terms of that attached to this resolution, and to exercise the provisions of the Rail Bridge Agreement, including but not limited to its termination provisions, except that any expenditure under the Rail Bridge Agreement for the current scope of the work which exceeds the amount of $6.6 million dollars shall require the approval of this Board.

Section 4. The Board authorizes the County Mayor or County Mayor�s designee to enter into such amendment of the Rail Bridge Agreement or such other contract or contracts with the FEC as may be necessary or appropriate to complete the bascule bridge restoration and intermodal rail yard developments at the Port which are the subject of the County�s Tiger II Grant Application (the �Improvements�). No such agreement shall be in an amount which, taken together with other agreements entered into or necessary for completion of the Improvements, shall exceed the amounts budgeted for the Improvements. Any amendment or contract entered into pursuant to this authorization shall contain a termination for convenience clause and be subject to ratification by this Board.

HEADER
Date:

To: Honorable Chairman Joe A. Martinez
and Members, Board of County Commissioners

From: Carlos A. Gimenez
Mayor

Subject: Rail Bridge Construction Administration Agreement between Miami-Dade County and the Florida East Coast Railway, LLC

This item was amended at the September 14, 2011 Economic Development and Social Services Committee meeting to correct certain dates contained within the body of the agreement.

STAFF RECOMMENDATION
RECOMMENDATION
It is recommended that the Board waive competitive bidding pursuant to Section 5.03(D) of the Charter and approve the attached Rail Bridge Construction Administration Agreement between Miami-Dade County and the Florida East Coast Railway, LLC (FEC). This contract will allow the FEC to oversee the restoration of the Port of Miami's rail bridge by a jointly selected third party design builder. The proposed resolution would also allow the Mayor to amend this Agreement, or enter into a new agreement, for the FEC to provide similar construction administration services for the development of the Port of Miami intermodal yard, all subject to ratification by the Board. Waiving competitive bidding to authorize this transaction is in the best interests of the County for the reasons set forth in this memorandum. This transaction is also authorized pursuant to Section 125.012 of the Florida Statutes which allows the County to enter into design and construction contracts with tenants, users and service providers of the Port.

SCOPE
The Port of Miami is located within District 5 � Commissioner Bruno A. Barreiro. The impact of this agenda item is countywide as the Port of Miami (�Port�) is a regional asset and generates employment for residents throughout Miami-Dade County.

FISCAL IMPACT/FUNDING SOURCE
The rail bridge restoration project is capped at $6.6 million unless approval is granted by the Board for a higher authorization. It will be funded entirely from the $22.767 million Department of Transportation (DOT) TIGER II Grant. The FEC will not charge for its construction administration services.

Should the Mayor amend this Agreement, or enter into a new agreement for the FEC to provide similar services for the development of a Port of Miami intermodal yard, such services will also be provided free of charge by the FEC. The total authorization for the entire On-Port rail project, which includes the bascule bridge restoration and intermodal rail yard development, will not exceed $25.067 million. This figure equals the $22.767 million DOT grant, plus $2.3 million pledged by the Port to this project under the TIGER II Grant Agreement. Should the Administration seek to expend funds beyond this limit, it will have to request such authorization from the Board.

TRACK RECORD/MONITOR
The Port of Miami staff responsible for monitoring are Bill Johnson, Director, Dorian Valdes, Assistant Director, Capital Development, and Kevin Lynskey, Assistant Director for Business Initiatives.

MANAGER'S BACKGROUND
BACKGROUND
The Port of Miami is undergoing its most significant cargo facility expansion in 30 years, putting in place three critical pieces of infrastructure that are timed with - and in anticipation of � the 2014 Panama Canal expansion. These assets all revolve around access: deeper waters to accommodate a new Post-Panamax class of mega-container vessel, twin tunnels to provide direct highway access, and an on-dock intermodal rail system to facilitate the movement of goods to distant markets and to better leverage the Hialeah Railyard as our �inland port�.

The Port of Miami�s intermodal and rail reconnection project was developed jointly with the FEC and resulted in a successful 2010 U.S Department of Transportation TIGER II grant. The project entails approximately $49M in investment in on-Port ($25M) and off-Port ($24M million) improvements, and the Tiger II grant was made available to cover the costs of the on-Port Improvements.

The on-Port work entails three principal improvements. First, the existing single-leaf rail bascule bridge, which has been non-operational since Hurricane Wilma, will be rehabilitated and strengthened to accept higher loading consistent with current design standards and a double stacking operation. Second, a railroad intermodal yard consisting of new rail lines (3 or more parallel tracks of between 9,000 and 12,000 feet total in length) will be designed, constructed, and installed. Third, a gantry system (loading and related yard equipment) will be procured and installed, as well.

This proposed Agreement involves the first project element, the restoration and strengthening of the rail bascule bridge. It allows the FEC to serve as the Port's Representative in procuring on the County's behalf a design builder. The Port will retain substantial project control throughout the procurement, construction and acceptance phases. The Administration may enter into a subsequent agreement with the FEC for construction administration services for the second project element, the intermodal yard development. The remaining On-Port element, which entails the purchase of a gantry system and other supporting yard equipment, will be the subject of a future County procurement process. The Maritime Administration (MARAD), which is the agency of the U.S. Department of Transportation that supervises the Tiger II Grant, has approved of this collaborative arrangement and its continued approval will be sought throughout the course of this Agreement.

Justification for Procurement Approach
The on-Port rail improvements are the first element of what is to be a much larger strategic partnership between the Port and FEC where each recognizes that integrating operations will increase their respective long term asset values. The FEC is strategically important to the Port because New Panamax vessels derive their efficiency by stopping at fewer ports such that viable ports of call must provide access to hinterland markets and these markets are most effectively served by rail. Additionally, successful seaports are frequently linked to �inland ports�, which provide high-volume interchange capacity between truck and rail services. Inland ports like the Hialeah Railyard not only offer shippers transport efficiencies, but they act as reliever valves for land-constrained ports like the Port of Miami. While the Port will (re)gain access to the national rail system and to a large inland facility, the FEC will be able to provide seamless service to distant markets and will be able to leverage their properties during the next phase of distribution facility development. It is likely that the Port and FEC will seek through future agreements to more fully integrate our South Florida assets.

In addition to these strategic considerations, the following additional practical considerations justify the Port's desire to have the FEC serve as its representative:

- Time: Though not a principal driver of our reasoning, we believe that three to six months is a reasonable estimate of potential time savings.

- Cost: The FEC will likely be able to leverage its volume rail purchasing to bring down certain acquisition costs.

- Expertise: The FEC has offered to provide their construction management services without charge and they have significant expertise in the specialized field of bascule bridge rehabilitation. As Port rail assets will be operated by the FEC, they have significant incentive to see that they are constructed to in accordance with specifications and design criteria.

- Operational Coordination: The FEC and the Port have the intention of operating the usable portions of rail during the construction period. This will require coordination with the rail contractor. Having FEC involved with construction management should simplify this task. The �operating� portion of the FEC Design, Procure, Construction Manage and Operate Agreement is envisioned as a simplified agreement set to expire upon final acceptance of the construction work. It is our intent to replace the operating agreement with a successor that is negotiated during the construction phase of the project.

Key provisions of the Proposed Agreement
The key provisions of the proposed "Rail Bridge Construction Administration Agreement" are as follows:

Scope of FEC's Services to the County: The FEC will serve as the County's representative to assist in the design, procurement, and construction management of the rehabilitation of the Port's existing single-leaf rail bascule bridge. FEC will not receive any compensation for these services, and will document for the County costs for direct payment from the selected third party contractors and material suppliers. The FEC shall supervise the Work in compliance with an attached construction schedule, the requirements of the Assumption and Grant Agreements, and all applicable laws.

Design standards for the Work: The Agreement contemplates a short term and long term design and construction standards for the Work with the objective of restoring railway service across the bridge for a minimum of twenty years following completion of the Work. The initial stage will restore the bridge to a Cooper E-60 live load standard (the �Restoration Repairs�). The second stage will improve the bridge to a Cooper E-80 live load standard (the �Overall Repairs�).

Procurement of the Work: Based on the County's design criteria, FEC will procure on the County's behalf a design builder to provide these repairs. This procurement document will conform substantially with an attached draft and will contain the following key terms: (a) Maximum Price that includes separate pricing for the Restoration and the Overall Repairs; (b) Best Value whereby the Design Builder will be selected based a combination of quality and price criteria; (c) The FEC and County approval rights whereby they would jointly agree on certain aspects of the work; and (d) Disadvantaged Business Enterprise Goal whereby a minimum contract goal of 15% of the contract amount is established under 49 CFR Part 26.

Selection of design builder and Contract Execution: Responses to the procurement will be evaluated by a selection committee consisting of two representatives each from the County and FEC. The agreement for Design Build services shall be executed by the FEC and the design builder and is subject to the County's approval.
Compliance with all applicable procurement regulations: Any procurement under this Agreement will comply with those regulations applicable to the County's expenditure of federal funds as identified in the Grant Agreement, including but not limited to the following: (a) E-Verify system whereby the FEC and selected contractor will confirm any employee's immigration status; (b) Davis-Bacon Act whereby the FEC and selected contractor will comply with federal wage provisions under 40 U.S.C. 3141, et seq. (c) Payment and Performance Bond Requirements whereby the selected contractor shall post performance and payment bond satisfactory under Florida Statutes Section 255.05 and naming the FEC and the County. (d) Insurance Coverage whereby the selected contractor shall secure Comprehensive General Liability and Railroad General Liability Insurance not less than $10,000,000 combined single limit per occurrence and naming the County as an additional insured; and (e) County Inspector General provisions whereby a specified amount is set aside in compliance of the County's oversight program.

Prosecution of the Work and Change Orders: The FEC shall be primarily responsible for oversight of the construction activities, and the County shall be entitled to inspect and approve the Work at specified intervals including (1) upon any payment requisition; (2) any change order or contract extra; (3) substantial completion, and (4) final completion. FEC shall not approve a payment requisition, change order request, or request for contract extra or approve substantial or final completion of the Work without the County�s approval. The selected Design Builder will have primary responsibility for changes in the Work except that the County shall be responsible only for unforeseen site conditions. The FEC shall be responsible for changes which result from the FEC�s failure to properly administer the Work.

County Payment of Costs: The County will reimburse FEC for the payment of the design builder. FEC's requisitions to the County are subject to inspection and audit, and no payment shall be made if there has been any material misrepresentations, pending litigation or default among other causes. This payment is subject to various reporting requirements, whereby the FEC and selected contractor shall abide by all applicable reporting requirements under the Grant Agreement, including maintaining accurate books and records for five years after completion of the Work. Also the County may audit all costs and expenses, and both the County & FEC may seek an reconciliation to the extent such audit reflects any under or over payments.

Acceptance of Work by the County, Interim Operation and Warranties: The County shall have the right to accept the Restoration Repairs and the Overall Repairs and receive all rights of against construction defects, including latent defects. Upon the County�s acceptance of the Restoration Repairs, the parties anticipate that FEC shall be authorized to use the bascule bridge subject to a separate use agreement.

Termination: The County may terminate this Agreement for FEC's default if FEC has breached any term or obligation expressed herein and failed to cure such breach within thirty (30) calendar days.
Among the Agreement's miscellaneous provisions, the County has no liability for the exercise of its police power; the FEC will indemnity the County for its negligence including the discharge of hazardous materials; there are no claims for lost profits or consequential damages; the FEC may not assign the Agreement without County consent; the FEC is not the County's agent; and no property interests are conveyed.

Construction Challenges
As with all construction contracts, the Proposed Agreement presents several potential risks as follows:

Failure to timely coordinate: By having the FEC act as the Port's representative, there is a risk that they may fail to effectively coordinate their respective obligations such that the improvement of the bascule bridge may be delayed and impact the ability to timely develop the subsequent on-port facilities.

Cost Overruns and Change Orders: There is no guarantee that the responses received pursuant to the procurement documents will fall within the amounts allocated for this work. Also as noted above, any failure by the County and FEC to timely coordinate could also lead to claims of delay by the selected contractor.

Delays in Payment: Under this Agreement, FEC will first pay the contractor and then receive reimbursement from the County's Grant allocation. Given the required approval for these payments by the County and MARAD, there is a risk that payments may be delayed.



_______________________
Deputy Mayor