Description
TI Corp met its goals outlined in the previous service plan for ensuring construction proceeds on schedule and on budget. Following review of its initial year of operations, the organization's performance measures have been selected to reflect TI Corp's conservative and prudent approach to financial management and its strategies to meet its long-term obligations. Measures of TI Corp's operational efficiency customer, service and employee engagement have been refined, updated and bench-marked to reflect operational observations in this first year of operations.
Page 1
TABLE OF CONTENTS
MESSAGE FROM THE CHAIR ................................................................................................................................................... 2
ACCOUNTABILITY STATEMENT ............................................................................................................................................... 3
ORGANIZATIONAL OVERVIEW ................................................................................................................................................ 4
TI CORP LOCATIONS ................................................................................................................................................................ 6
CORPORATE GOVERNANCE..................................................................................................................................................... 7
STRATEGIC CONTEXT ............................................................................................................................................................... 8
RISKS ...................................................................................................................................................................................... 10
GOALS, STRATEGIES, PERFORMANCE MEASURES AND TARGETS ........................................................................................ 12
GOVERNMENT’S LETTER OF EXPECTATIONS ........................................................................................................................ 19
SUMMARY OF FINANCIAL OUTLOOK .................................................................................................................................... 21
CAPITAL PLAN ........................................................................................................................................................................ 22
CONTACT INFORMATION ...................................................................................................................................................... 23
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MESSAGE FROM THE CHAIR
To: The Honourable Todd Stone, Minister of Transportation and Infrastructure
Dear Minister:
On behalf of the Board of Directors of Transportation Investment Corporation (TI Corp), I am pleased to provide our
Service Plan for 2014/15 – 2016/17.
TI Corp met its goals outlined in the previous service plan for ensuring construction proceeds on schedule and on
budget. Following review of its initial year of operations, the organization’s performance measures have been selected
to reflect TI Corp’s conservative and prudent approach to financial management and its strategies to meet its long-term
obligations. Measures of TI Corp’s operational efficiency customer, service and employee engagement have been
refined, updated and benchmarked to reflect operational observations in this first year of operations.
The first year of operations on the new Port Mann Bridge highlighted TReO, TI Corp’s sustainable all electronic tolling
system. A successful driver registration campaign emphasized the easy, electronic and efficient tolling system and
highway improvements opened west of the Port Mann Bridge, doubling the time savings for drivers.
Expectations for ongoing traffic fluctuation on the Highway 1 corridor are a result of new options for commuters and
goods movers, including the improved Highway 1 and the new Highway 17, or South Fraser Perimeter Road, which
connects to three untolled crossings. Commuters can also consider the newly connected Highway 1 HOV network or the
ExpressBus over the Port Mann Bridge, which sees more than 50,000 riders per month.
Looking ahead through the service planning period, TI Corp’s activities will focus on the continued delivery of the Port
Mann/Highway 1 Improvement Project, the largest transportation infrastructure project in B.C. history and the
operation of a free-flow tolling system with approximately 2 million unique customers on an annual basis. The planning
focus for 2014/15 will include maintaining best-in-class service levels, employee engagement and reducing operating
costs all while improving levels of operational efficiency.
Risks to TI Corp over the service planning period are any factors that could affect traffic volumes and corridor reliability
or safety. To mitigate these risks, TI Corp updated its traffic and financial forecasts after engaging an independent traffic
forecast firm. Additionally, the successful opening of new highway lanes have provided drivers with the project’s full
time savings and will ensure any remaining finishing work does not impact corridor reliability or predictability. All risks
have an associated management strategy, and with ongoing monitoring, present only a low to moderate risk to TI Corp.
Grant Main
Chair, Board of Directors
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ACCOUNTABILITY STATEMENT
The 2014/15 – 2016/17 Transportation Investment Corporation Service Plan was prepared under the direction of the
Board of Directors in accordance with the Budget Transparency and Accountability Act, the BC Reporting Principles, and
the 2014/15 – 2016/17 Crown Corporation Service Plan Guidelines. The plan is consistent with government’s strategic
priorities and its fiscal plan. The Board is accountable for the contents of the plan, including what has been included and
how it has been reported.
To the best of our knowledge the significant assumptions, policy decisions, events and identified risks are current and
have been considered in preparing this plan. Performance measures are consistent with TI Corp’s mandate and goals,
and focus on aspects critical to the corporation’s performance. Targets in the plan have been determined based on an
assessment of TI Corp’s operating environment, forecasting assumptions and risks.
Grant Main
Chair, Board of Directors
Page 4
ORGANIZATIONAL OVERVIEW
Mandate and Enabling Legislation
Transportation Investment Corporation (TI Corp) was established under the Transportation Investment Act. TI Corp’s
primary mandate as part of the Province’s Gateway Program is to manage and ensure successful delivery and
implementation of the Port Mann/Highway 1 Improvement Project.
TI Corp is also mandated to recover the capital costs of the project as well as operating and maintenance costs of the
bridge and highway.
Our Vision
To develop and implement self?sustaining infrastructure projects for the benefit of British Columbians.
Our Values
The corporation values the diversity of its employees and will strive to deliver projects in a manner that is respectful to
residents, businesses, communities, all levels of government and the environment, while ensuring the safe and efficient
movement of people and goods.
Core Business Areas and Services
TI Corp is a Crown corporation tasked with the delivery of the Port Mann/Highway 1 Improvement Project. This includes
construction of the new bridge and highway improvements, implementation and management of the tolling operations
and repayment of the project costs. All electronic tolling on the new Port Mann Bridge is paying for the design,
construction, financing and operation of the improvements to the Port Mann/Highway 1 corridor.
The Port Mann/Highway 1 project uses a free-flow, open road tolling system; a safer and more efficient method of
tolling than traditional toll booths. The system is easy, electronic and efficient and based on the principle of superior
customer service.
Fully electronic tolling means exhaust emissions from idling cars at toll booths are eliminated and bridge users do not
need to worry about exact change or delays. Instead, electronic decals and video capture technology identify vehicles as
they pass under the toll gantry at the south end of the bridge. Bridge users may choose to pay before or after travel
using a variety of payment methods, including online at www.treo.ca, by phone or in person at self-serve kiosks or
Customer Service Centres.
Highway 1 is the most economically critical route in Greater Vancouver. Built in the early 1960s when the population of
Metro Vancouver was 800,000, it now serves as the most important east-west corridor to the region’s 2.2 million
people.
The Port Mann/Highway 1 project is British Columbia’s largest transportation infrastructure project and a key
component of the Province’s Gateway Program. The Port Mann is a major crossing over the Fraser River forming part of
Highway 1 between Coquitlam and Surrey. The new 10-lane bridge, expanded high occupancy vehicle (HOV) network,
Page 5
transit priority facilities and a widened Highway 1 will help cut round-trip travel times in this corridor by up to 50 per
cent, and has allowed for public transit over the crossing for the first time in over 25 years.
The Gateway Program was established as part of a broader response by the Province of British Columbia to reduce
congestion, improve the movement of people and goods, and improve safety and reliability on key highway corridors.
The Gateway Program improvements will complement other regional road and transit improvements currently planned
or under construction.
The Port Mann/Highway 1 Improvement Project includes construction of the new Port Mann Bridge, widening the
highway, upgrading interchanges and improving access and safety on Highway 1. The project spans a distance of
approximately 37 kilometres from the McGill Street Interchange in Vancouver to 216th Street in Langley. Taken
together, these improvements will help create a comprehensive and effective transportation network for Greater
Vancouver, which will improve the movement of people and goods, facilitating economic growth, increased
transportation choices and improved connectivity to areas designated for population growth.
The goals of the Port Mann/Highway 1 Improvement Project are as follows:
? Reduce congestion and travel times
? Improve safety and accessibility
? Facilitate expanded public transit service
? Expand the transportation network to better accommodate high occupancy vehicles (HOV), cyclists and
pedestrians
As a result of this project, TransLink’s ExpressBus service over the Port Mann Bridge connects New Westminster at the
Braid SkyTrain Station to the newly constructed Carvolth Exchange in Langley in about 22 minutes, and current ridership
is approximately 50,000 riders per month.
Partners, Clients, Stakeholders
TI Corp’s key responsibilities are to pay for the Port Mann/Highway 1 Improvement Project within the prescribed time
period, and the ongoing management and oversight of the design-build contractor and their activities, ensuring that
construction proceeds on budget and on time with minimal disruption to road and bridge users.
Our key partners include:
• Ministry of Transportation and Infrastructure/BC Transportation Financing Authority
• Municipalities adjacent to the corridor
• Insurance Corporation of British Columbia
• TransLink
• Kiewit/Flatiron General Partnership
• Trans Canada Flow Tolling Inc. (TC Flow)
• Sanef ITS Inc.
• Mainroad Infrastructure Management Limited Partnership
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Key stakeholders and clients include tolling customers, businesses and industries that will benefit from the project
improvements and those providing advice and input:
• The travelling public, TI Corp’s customers
• RCMP and other first responders
• First Nations
• Businesses
• Commercial trucking, service companies and drivers
• Businesses and residents located adjacent to the project corridor
Additional information about the Gateway Program and TI Corp can be accessed at the following website links:
http://www.gatewayprogram.bc.ca
http://www.pmh1project.com
More information about open road tolling and TReO, TI Corp’s customer service brand, is available here:
http://www.treo.ca
TI CORP LOCATIONS
TI Corp operates TReO Customer Service Centres in Surrey and Coquitlam. These locations are conveniently located
close to the highway so drivers can pay their tolls or receive customer service before or after they travel.
TI Corp also operates a construction project office with project personnel in the field daily along the
37 kilometers of highway improvements.
Corporate Head Office:
Suite 210 – 1500 Woolridge Street, Coquitlam, B.C. V3K 0B9
Project Office:
Suite 200 – 145 Schoolhouse Street, Coquitlam, B.C. V3K 4X8
TReO Coquitlam Customer Service Centre:
2nd floor, 1500 Woolridge Street, Coquitlam, B.C. V3K 0B9
TReO Surrey Customer Service Centre:
16300 – 104 Avenue, Surrey, B.C. V4N 1Y5
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CORPORATE GOVERNANCE
By legislation, TI Corp is governed by a Board of Directors appointed by the Lieutenant Governor in Council. The Board of
Directors, through the Chair, reports to the Minister of Transportation and Infrastructure (designated as the Minister
Responsible for TI Corp) and is responsible for overseeing the conduct of business, directing management and ensuring
that all major issues affecting TI Corp’s affairs are given appropriate consideration.
The Board of Directors adheres to the following Corporate governance principles, which are set in accordance with Part
2 “Best Practices Guidelines: Governance” of the Province’s Governance and Disclosure Guidelines for Governing Boards
of British Columbia Public Sector Organization:
? Act in the best interests of the Corporation
? Develop, maintain and adhere to terms of reference for the Board, Chair, Directors and Committees
? Ensure there is a planning process, to become engaged in the process, and then review, question, validate and,
ultimately, endorse the Service Plan and monitor performance
? Follow the board-approved TI Corp Governance Guidelines
As a Crown agency, TI Corp operates under a Government Letter of Expectations that outlines both the corporation’s as
well as the shareholder’s responsibilities, and is jointly signed by the Minister of Transportation and Infrastructure and
the Chair of TI Corp.
TI Corp’s Board of Directors follows the governance practices contained in the Board Resourcing and Development
Office (BRDO) corporate governance guidelines. More information regarding TI Corp Board governance can be found at:
http://www.pmh1project.com/about-the-project/about-ti-corp/Pages/Financial-Reporting.aspx.
As a public Crown corporation and part of the Government of British Columbia’s Public Sector Employer’s Council (PSEC),
TI Corp operates under PSEC’s best practices for transparent and full disclosure of public sector executive compensation.
The Board of Directors currently consists of:
Chair - Grant Main
Member - Larry Blain
Member - Don Fairbairn
Committees
In November 2013 the Board established an Audit and Risk Committee to replace the existing Operations Committee.
This reflects TI Corp’s continuing shift away from construction operations and towards toll operations. Members are:
Don Fairbairn, Chair
Larry Blain, Member
Mike Proudfoot, Ex-officio Member
Officers
Mike Proudfoot, Chief Executive Officer
Garry Dawson, Vice President, Technical Services
Patricia Soanes, Vice President, Finance and Corporate Services
Mahrokh Arefi, Vice President, Tolling
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STRATEGIC CONTEXT
Operating Environment
With the opening of the new Port Mann Bridge in December 2012 and the opening of new Highway 1 lanes through
Coquitlam, Burnaby and Vancouver in December 2013, drivers are experiencing the time savings promised by the Port
Mann/Highway 1 Improvement Project.
For the first year after the bridge opened, the tolling framework provided a substantially reduced toll rate for drivers
who registered for a TReO tolling account, installed a windshield decal, and provided a payment mechanism for
automatic payment. This introductory toll rate recognized that drivers had begun to experience significant travel time
savings and that those time savings would increase when construction west of the bridge opened new lanes.
This tolling framework was established to promote the use of windshield decals, which are more reliable and accurate
than licence plate recognition, and to promote automatic payment, a much more efficient method of toll collection.
Immediately following the opening of new Highway lanes and the introduction of the full rate in January 2014, TI Corp
has seen a significant increase in travel time savings with drivers saving up to an hour a day. Those time savings are
highest during the rush hours, leading to significantly higher traffic during the morning and afternoon peak periods. The
biggest increase in traffic volumes has been in the westbound direction in the morning, which is up more than 10%
compared to 2013, indicating the significant time savings are attractive to drivers. Also, truck traffic using the Port Mann
Bridge has increased significantly since it opened. On average during the month of January 2014, 1100 more trucks
crossed the bridge than the same time in January 2012, an increase of 14%.
Significantly improved options for commuters have contributed to ongong traffic fluctuation on the corridor. The
ExpressBus from Langley over the Port Mann Bridge has a growing ridership of more than 50,000 passengers per month,
and drivers are also taking advantage of the newly connected Highway 1 HOV network. In addition to the opening of
new Highway 1 lanes west of the Port Mann Bridge, the completion of the new Highway 17 (South Fraser Perimeter
Road) provides connections to three untolled crossings over the Fraser River.
TI Corp will continue to monitor the use of alternate routes, but traffic fluctuation is expected to continue for several
months and is mirroring the experience seen in other jurisdictions where tolling is more prevalent.
The 2014/15–2016/17 service planning period will focus on two major accountabilities:
1. The continued delivery of the Port Mann/Highway 1 Improvement Project, the largest transportation
infrastructure project in B.C. history
2. Operation of a free-flow tolling system serving approximately 100,000 – 120,000 vehicles per day with
approximately 2 million unique customers on an annual basis
TI Corp’s objectives, detailed in the following pages, are reflective of these two primary accountabilities. Following its
first year of operations of the toll system, TI Corp continues to refine its benchmarks. The 2014/15 – 2016/17 Service
Plan contains objectives included in previous service plans, specific to construction of the PMH1 Project. The service plan
also continues the development of new goals to manage and measure the organization’s performance with respect to
the operation of the tolling system.
TI Corp’s priorities are to ensure the safe and reliable movement of traffic and goods along the Port Mann/Highway 1
corridor, the operation of a self-sustaining and financially stable organization, the provision of superior customer service
and engagement of a skilled and motivated workforce.
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The key strategic issues and risks for TI Corp are any factors that could affect traffic volumes and revenues, its role as a
self-sustaining financially stable organization, corridor reliability or safety, construction schedule and budget.
In addition, TI Corp is addressing the risk that road conditions or traffic incidents along the corridor will affect potential
travel time savings or anticipated safety benefits. To do so, an updated incident management procedure has been
implemented to ensure any motor vehicle incidents are dealt with quickly and efficiently, with full lane capacity
returned promptly. Also, to prevent travel lane or bridge closures associated with inclement weather, an updated
weather monitoring protocol has been implemented. In addition, measures to address ice build-up on the cables were
implemented in advance of winter 2013/14.
The above noted strategic issues and risks, including economic, demographic and market factors that could impact
performance in the service planning period are accounted for in TI Corp’s risk management planning.
Organizational Capacity
TI Corp has the required capacity to meet its key objectives for the 2014/15 fiscal year.
? Deliver the Port Mann/Highway 1 Improvement Project on time and on budget
? Ensure the safe and reliable movement of traffic and goods along the Port Mann/Highway 1 corridor
? Operate a self-sustaining and financially stable organization
? Provide superior customer service
? Engage a workforce that drives operational success
The design-build contractor is responsible for the on time and on budget delivery of the Port Mann/Highway 1
Improvement Project and its related benefits.
The tolling operator is responsible for the day-to-day tolling operations, including customer service, helping customers
set up accounts, answering questions about account options and programs, billing and accepting payments in person, by
phone and online.
TI Corp will be responsible for ensuring both the design-build contractor and the tolling operator meet prescribed
standards and timelines and its workforce provides the operational oversight that helps ensure the financial stability of
the organization.
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RISKS
Risk management is implicit in TI Corp’s management methodology. Key risk management principles include:
• Immediate communication of identified risks
• Proactive risk mitigation
• Continual review
• Appropriate allocation of risks to relevant parties
All risk identified in this table have an associated management strategy. Together with these strategies outlined below
and ongoing monitoring, no risk presents more than a low to moderate potential impact to TI Corp.
Key Strategic Issue Status and Potential Impacts Risk Mitigation
Project cost escalation:
? Debt borrowing costs
? Project schedule and
budget
TI Corp is maintaining a mix of
both long term and short term
debt in accordance with the
2009 debt financing strategy.
This mix enables the company to
conservatively take advantage
of short term interest rates to
reduce borrowing costs.
The Project is currently on
schedule and on budget. The
opening of Phase One
improvements and completion
of tolling components was
achieved on schedule in
December 2012. Phase Two
improvements opened to traffic
in December 2013. Final
finishing work will continue
through 2014. This work
primarily involves completion of
the final two lanes of the Port
Mann Bridge, which are
required for future capacity.
Regular cash flow monitoring, analysis and
reporting, inclusive of debt strategies, are
conducted on an ongoing basis. TI Corp
has locked in long term debt at a
favourable rate to minimize borrowing
costs as appropriate.
Risks associated with interest rate
fluctuations over the course of the project
are mitigated through the use of a long-
term hedging strategy.
TI Corp has entered into a design-build
agreement with the contractor that
requires the contractor to meet specific
costs and dates for the delivery of specific
elements of the project.
The design-build agreement places
responsibility for construction-related cost
overruns with the contractor for those
activities under its direct control.
Ongoing monthly monitoring of
construction progress is undertaken to
achieve schedule certainty and mitigate
cost pressures.
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Tolling:
? Public acceptance of
tolling operation
? Use of alternative
crossings
? Long-term traffic volume
fluctuations
Customer account registration
has exceeded forecasts. More
than one million vehicles have
registered with TReO and more
than 80-85% of regular users are
signed up, a measure which is
best-in-class for the tolling
industry internationally.
Risk of traffic diversion to other
parts of the region.
Risk that volumes will be
substantially lower than
forecasted would have financial
consequences.
The base toll rate was introduced in
January 2014 after a full year of a half-
price introductory toll rate for the
majority of users.
The framework is supported by a public
communication and engagement plan to
raise awareness of the expiry of the
introductory toll rate and the travel time
savings afforded by the project.
Time savings delivered by new, improved
highway lanes and the communications
plan described above encourage drivers to
use the new bridge and widened highway.
Efforts to promote travel time savings, and
enhance time savings with continued
highway improvement will continue to
mitigate diversion to alternate routes.
TI Corp is continually updating its traffic
forecasts to account for recent traffic
patterns, fuel prices and economic
conditions. These traffic projections have
been used to develop internal financial
modeling and forecasting.
Ongoing monitoring of traffic volumes and
usage patterns allows for updates to
financial forecasts and development of
mitigation plans as required.
Reliability and safety:
? Improved corridor
reliability and safety
Risk that road and weather
conditions or traffic incidents
along the corridor will affect
potential travel time savings or
anticipated safety benefits.
An incident management procedure is in
place to respond to any motor vehicle
incidents quickly and efficiently to restore
traffic flow.
To prevent traffic disruptions associated
with inclement weather, an updated
weather monitoring protocol has been
implemented. In addition, measures to
address ice build-up on the cables was
refined and implemented in advance of
winter 2013/14.
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GOALS, STRATEGIES, PERFORMANCE MEASURES AND TARGETS
As noted above, the 2014/15 – 2016/17 reporting period builds on the significant operational changes made by TI Corp
in the 2013/14 – 2015/16 service plan.
As the organization looks ahead to the completion of construction activities, TI Corp’s goals have shifted to better reflect
the continued operation of an open road tolling system, the provision of services and benefits based on best practices
used by similar tolled bridges and roadways, and the operation of a sustainable and financially stable organization.
As TI Corp moves further from construction to operations, this process will continue and organizational objectives will be
refined.
Goal 1: Deliver the Port Mann/Highway 1 Improvement Project on time and on budget
A key function of TI Corp is the ongoing management and oversight of the design-build contractor and its activities,
ensuring construction proceeds according to schedule and remains on budget.
Strategies
A design-build agreement has been signed between TI Corp and the Kiewit/Flatiron General Partnership. Under this
structure, the contractor is required to meet specific dates for the delivery of certain elements of the project.
To achieve these goals, TI Corp has set completion targets by fiscal year and measures progress against these targets.
The design-build agreement structure places responsibility for construction-related cost overruns with the contractor for
those activities under its direct control.
To achieve these goals, TI Corp has set specific financial targets and measures all streams of activity by fiscal year and
measures progress against these targets.
Performance Measures
1
The 97% completion figure recognizes an updated forecast total spend of $3,236 million in 2013/14 out of a total project budget of
$3,319 million.
2
This performance measure will no longer be relevant at the end of construction and will be superseded by new operations-based
targets.
Performance
Measures
2012/13
Actual
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Achieve percentage
of completion target
for total design &
build construction
91% 97%
1
100% N/A
2
N/A
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Performance Management
The design-build contractor reports regularly to TI Corp on project progress and the percentage of completion is derived
from an estimate of the progress of the particular segments of the project using verified progress billings.
The data used to measure financial performance is contained in TI Corp’s annual financial statements, which are subject
to annual independent audit. TI Corp has received an unqualified audit each year it has been in operation.
Goal 2: Ensure the safe and reliable movement of traffic and goods along the
Port Mann/Highway 1 corridor
Key goals of the Port Mann/Highway 1 Improvement Project are the reduction of congestion and travel times along the
project corridor, improved safety and accessibility, expanded transit service and an expanded transportation network to
better accommodate high occupancy vehicles (HOV), cyclists and pedestrians.
This was a new goal for 2013/14 and reflects TI Corp’s shift in roles from a construction focus to that of an operational
service provider to customers and stakeholders along the Port Mann/Highway 1 corridor.
Strategies
TI Corp’s strategies to implement these benefits along the new Port Mann/Highway 1 corridor will include:
? Managing corridor reliability and travel time predictability
? Ensuring corridor efficiency, and minimize disruptions to traffic flow
Performance Measures
Corridor Travel Time Savings
To benchmark this performance measure, sample routes, noted below, were driven in the 2012/13 reporting period
before Port Mann/Highway 1 improvements were opened to traffic. Travel times were measured in prevailing conditions
by an independent traffic engineering firm. Routes were traveled several times to estimate the average travel time.
Forecasts and targets for these routes will be analyzed after the opening of all new Highway 1 lanes to accurately
measure the travel time savings associated with the Port Mann/Highway 1 Improvement Project.
The target for the performance measure is a 30% travel time saving, as in the Gateway Program Definition Report,
published during the PMH1 Project planning phase. Travel time estimates generated since then have indicated that
3
The forecasted 2013/14 spend of $3,236 million is revised from an earlier forecast of $3,270 million.
4
This performance measure will no longer be relevant at the end of construction and will be superseded by new operations-based
targets.
Performance
Measures
($Millions)
2012/13
Actual
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Remain within the
approved $3,319
Capital Budget
$2,997 $3,236
3
$3,319 N/A
4
N/A
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travel time savings as high as 50% are possible with a new Port Mann Bridge and widened Highway 1. These updated
estimates have informed the development of this performance measure.
Corridor Incident Prevention
A key objective of the Port Mann/Highway 1 Improvement Project is to improve the safety and efficiency of the highway
corridor. Improved interchanges, new merging lanes, dedicated on and off-ramps and an overall reduction in congestion
will all contribute to a safe and efficient corridor.
During the 2013/14 service plan period, TI Corp developed new performance standards to measure the safety and
efficiency of the PMH1 corridor. To compare collision data from the improved Highway 1 to data from the original
corridor, information was gathered from the British Columbia Ministry of Transportation and Infrastructure’s Collision
Information System
9
. The data used to develop the baseline is from the five years prior to the commencement of PMH1
construction; 2004/05 to 2008/09.
Forecasts are a conservative value based on collision data from 2013/14 on the improved sections of Highway 1 through
Langley, Surrey and the Port Mann Bridge. It is anticipated that projections may change over time as TI Corp reviews
observed data on comparable corridors as well as the PMH1 improvements.
5
Round trip travel times are based on westbound AM and eastbound PM total travel times.
6
Route 1: 152 Street at 108 Avenue, Surrey to/from United Boulevard at Lougheed Highway, Coquitlam.
7
Route 2: 200 Street at 80 Avenue, Langley to/from Boundary Road at Grandview Highway, Vancouver.
8
Route 3: 176 Street at 96 Avenue, Surrey to/from Brunette Avenue at Lougheed Highway, Coquitlam.
9
The Collision Information System database is populated by collision information gathered by police incident reports on the
provincial roadways and received from ICBC.
Performance
Measures
Pre-construction
Roundtrip
5
Actual
(Benchmark)
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Route 1
6
152 Street
to/from
United Boulevard
0:23
30% - 40%
savings
40% - 50%
savings
50% savings 50% savings
Route 2
7
200 Street to/from
Grandview
Highway
1:47
30% - 40%
savings
40% - 50%
savings
50% savings 50% savings
Route 3
8
176 Street to/from
Brunette Avenue
0:52
30% - 40%
savings
40% - 50%
savings
50% savings 50% savings
Page 15
Goal 3: Operate a self-sustaining and financially stable organization
The Port Mann/Highway 1 Improvement Project is a self-funding project using all electronic, open road tolling
technology. The Concession Agreement between the Province and TI Corp requires the Corporation to repay the
Port Mann/Highway 1 Improvement Project debt by 2050 and meet the operations, maintenance and rehabilitation
needs as well as undertake any necessary future improvements.
As such, it is TI Corp’s responsibility to ensure a sustainable, long term source of revenue and demonstrate the
cost-effective management of operations. TI Corp will ensure it remains financially stable by implementing operational
efficiencies and controlling administrative costs, thereby keeping tolls low for customers.
During the long-term planning phase of the Port Mann/Highway 1 Improvement Project, several traffic forecasts were
developed, including those of private sector bidders during the project’s competitive selection process. Those forecasts
indicated that based on the expected growth of the Lower Mainland’s population, and the associated traffic growth, it
would take approximately 40 years to meet all of the financial obligations associated with the project. As a result a
tolling period expiring in 2050 was established.
TI Corp has established financial metrics that set out the requirements and objectives for the organization. A full
financial report is included in the Summary of Financial Outlook in this Service Plan, but this selection highlights annual
revenue targets laid out in the organization’s long term plan.
10
Traffic incidents tracked in this performance measure are on the PMH1 corridor from 216 Street in Langley to McGill Street in
Vancouver.
Performance
Measures
Preconstruction
Baseline
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Vehicle collisions on the
PMH1 corridor
10
680 collisions
20%
reduction
from
baseline
25%
reduction
from
baseline
25%
reduction
from
baseline
25%
reduction
from
baseline
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($ Millions)
11
2012/13
Actual
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Revenue
12
15 98 144 159 174
Administration Expenses
13
12 9 9 8 8
Operating Profit/(Loss)
(27) 49 104 120 135
Annual revenue targets have been set that show a year after year increase in revenues through careful financial
management, and that correspond with increasing traffic volumes on the Port Mann Bridge. At the same time,
administrative expenses have been capped to limit overhead growth.
TI Corp is on track to meet all financial obligations by 2050. To ensure it remains on track, traffic forecasts are reviewed
from time-to-time and compared against observed traffic volumes. TI Corp will continue to update forecasts for the Port
Mann Bridge and Highway 1 corridor.
The operation of a self-sustaining and financially stable organization was a new goal for 2013/14 and reflects TI Corp’s
shift in roles from a construction focus to that of an operational service provider to customers and stakeholders along
the Port Mann/Highway 1 corridor.
Strategies
TI Corp’s strategies to operate a self-sustaining and financially stable organization include:
? Repay the Port Mann/Highway 1 Improvement Project debt within the prescribed time period
? Implement operational efficiencies and control administrative costs to keep costs low for TI Corp and tolls low
for customers
Performance Measures
Operational Efficiency
A key measure of operational efficiency for an open road tolling system is the number of registered customers, and the
percentage of customers with registered accounts. Registered accounts with windshield decals and payment
mechanisms on file are most efficient and cost effective because they are more accurate and payment is fully
automated, meaning invoicing and reconciliation is not required.
11
All figures have been rounded to millions of dollars ($M) which results in rounding additions not always being consistent.
12
Revenue for 2012/13 represents four months of tolling operations commencing in December 2012.
13
Administration Expenses includes communications, salaries, facilities costs and other corporate overhead.
Page 17
TI Corp’s goal is to have 80-85% of regular users registered, which is consistent with best-in-class industry standard.
Goal 4: Provide superior customer service
Superior customer service has always been one of TI Corp’s key priorities. As construction winds down, TI Corp’s annual
customer satisfaction survey has transitioned to measure customer attitudes towards the toll system and TReO, TI
Corp’s consumer-facing brand. The toll operator, TC Flow Inc., was selected in part because of its demonstrated
experience and commitment to customer service.
In any given month, the TReO Customer Service Centres receive more than 46,000 phone calls, 3,600 walk-in customers
and respond to approximately 4,000 customer emails and letters. To ensure the toll operator maintains a satisfactory
level of service, its performance is measured on key indicators of customer service.
Strategies
TI Corp’s strategies to provide continued superior customer service include:
? Operate a toll system that is easy, electronic and efficient for customers
? Ensure customers receive superior service through meeting established performance measures
Performance Measures
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Percentage of telephone calls
answered within 20 seconds
80% 80% 80% 80%
Number of customer service
complaints as a share of Port
Mann crossings
1/10,000 1/10,000 1/10,000 1/10,000
Overall level of satisfaction
with the toll system and
customer service
80-85% 85% 85% 85%
Overall level of satisfaction
with the Port Mann/Highway 1
improvements
80-85% 85% 85% 85%
Performance
Measures
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
% of regular users
with registered
accounts
80-85% 80-85% 80-85% 80-85%
Page 18
Performance Management
These performance measures are derived from the key performance indicators in the toll operator agreement. Annual
surveys of TReO customers are conducted by TI Corp to reflect its customer service responsibilities.
Goal 5: Engage a workforce that drives operational success
TI Corp requires a highly qualified, diverse and flexible workforce in order to provide reliable, customer-oriented service
for commuters and stakeholders that rely on the Port Mann/Highway 1 corridor.
Strategies
TI Corp’s strategies to engage its workforce and drive operational success include:
? Supporting and investing in its employees
? Fostering a culture of fiscal responsibility, teamwork and innovation
Performance Measures
TI Corp monitors success in leading an engaged workforce through its annual spring employee survey, which covers a
broad range of attributes including performance management and employee engagement. TI Corp’s forecast for success
in terms of employee satisfaction mirrors TI Corp’s own benchmarks for customer satisfaction, which are derived from
the key performance indicators in the toll operator agreement.
The target for 2014/15 has been set at “previous result +2%” to reflect both the previous result and the desired level of
continuous improvement to the score.
Performance Measures
2013/14
Forecast
2014/15
Target
2015/16
Target
2016/17
Target
Employee satisfaction with
TI Corp as an employer of choice
that invests in and supports its
employees.
85%
Previous
result +2%
TBD
TBD
Performance Management
Performance is measured using the organization’s annual employee engagement survey conducted each spring.
Page 19
GOVERNMENT’S LETTER OF EXPECTATIONS
The Government’s Letter of Expectations, between the shareholder (the Government of British Columbia) and TI Corp, is
an agreement on the respective roles and responsibilities of each, and serves as the basis of agreement between the
shareholder and the Corporation on corporate mandate including high-level performance expectations, public policy
issues and strategic priorities.
GLE Direction
Transportation Investment Corporation
Alignment
Manage and ensure the delivery and
implementation of the design build work on the
Port Mann/Highway 1 Improvement Project, all in
accordance with the terms of the design build
agreement dated as of March 17, 2009, signed
between Transportation Investment Corporation
(TI Corp) and Kiewit/Flatiron General Partnership,
the contractor.
TI Corp continues to manage and ensure the quality
of work done by the design-build contractor.
On December 1, 2012, Phase One of the Port
Mann/Highway 1 Improvement Project was
completed and opened on schedule. With the
opening of the new bridge and highway widening
between Langley and Coquitlam completed, drivers
began to experience significant travel time savings.
Phase Two of the project, which includes highway
widening and interchange improvements from
Coquitlam to Vancouver, opened to traffic in
December 2013.
Operate and manage a tolling system and toll
collections at the Port Mann Bridge, consistent with
the provisions of the Port Mann / Highway 1
Concession Agreement signed on March 10, 2010,
between the Province, BCTFA and TI Corp and any
future modifications to this agreement.
Trans-Canada Flow Tolling, the Port Mann/Highway
1 tolling operator, commenced operations during
the summer of 2012.
Registration for TReO tolling accounts exceeded
expectations with more than one million vehicles
registered by December 2013. TI Corp’s registration
drive has been recognized internationally as best-
in-class for a new open road tolling system.
Work with the Ministry of Transportation and
Infrastructure (the Ministry) to ensure financial
targets and reporting requirements, as identified in
the Ministry Budget Letter to TI Corp, are met.
Inform the Ministry in a timely manner of any
pressures in meeting these financial targets and the
related mitigation strategies.
TI Corp is committed to managing and meeting the
financial targets outlined in this Service Plan.
Regular dialogue and meetings between TI Corp
and the Ministry ensure communication regarding
financial reporting is frequent and timely.
TI Corp submits quarterly financial statements,
capital expenditures and debt forecasts.
Page 20
Fulfill any other obligations consistent with the
provisions of the Concession Agreement.
Transportation Investment Corporation continues
to fulfill its obligations under the Concession
Agreement.
In addition to the appropriate management of
revenue and expenses, TI Corp continues to look
for opportunities to ensure tolls are kept as low as
possible for families, commuters and businesses.
This includes an unlimited monthly pass for very
frequent users, a peak period 25% discount for high
occupancy vehicles and a 50% discount for large
trucks travelling between 9PM and 5 AM.
In addition to the direction contained in TI Corp’s Government Letter of Expectations, TI Corp and the PMH1
Improvement Project also play a role in the Province’s climate change goals, by reducing greenhouse gases associated
with congestion-induced idling and traffic delays, as well as by making public transit across the Port Mann Bridge
possible for the first time in more than 25 years.
Highway 1 ExpressBus service is providing transit service between the Carvolth Exchange in Langley and Braid SkyTrain
Station as fast as, or faster, than travelling by car. Popularity of the ExpressBus service is growing and 50,000 riders
currently use the service per month.
Page 21
SUMMARY OF FINANCIAL OUTLOOK
The Concession Agreement requires TI Corp to repay the Port Mann/Highway 1 Improvement Project debt by 2050. As
such, TI Corp has taken a prudent, long-term approach to financial management. In 2013/14, TI Corp engaged an
independent firm to assist with traffic forecast estimates to better reflect the long-term economic conditions of the
Metro Vancouver area and meet the obligations in the Concession Agreement.
($ Millions)
14
2012/13 2013/14 2014/15 2015/16 2016/17
Actual Target Target Target Target
Revenue
15
15 98 144 159 174
Operating Expenses
16
22 28 20 20 20
Highway Operations and
Maintenance
17
8 12 11 11 11
Administration Expenses
18
12 9 9 8 8
Operating Profit/(Loss) (27) 49 104 120 135
Interest Expense
19
25 107 131 148 158
Depreciation Expense 8 31 52 52 53
Net Income/(Loss) (60) (89) (79) (80) (76)
Total Balance Sheet Debt
20
2,794 3,452 3,608 3,615 3,616
Retained Earnings/(Deficit) (135) (224) (303) (383) (459)
PMH1 Project Expenditure
21
540 239 83 - -
14
All figures have been rounded to millions of dollars ($M) which results in rounding additions not always being consistent.
15
The main source of revenue is from tolling and 2012/13 represents four months of tolling operations commencing in December
2012.
16
Operating Expenses include toll operator and system operations, ongoing operating expenses including quality monitoring and
assurance programs as well as certain costs relating to the decommissioning of the old Port Mann Bridge.
17
Highway Operations and Maintenance costs include the third party service contractor Mainroad Infrastructure Maintenance LP,
and services provided by the Ministry of Transportation and Infrastructure.
18
Administration Expenses includes communications, salaries, facilities costs and other corporate overhead.
19
Depreciation and Interest expenses increase as various segments of the bridge and associated roadways are completed and made
available for use.
20
Total Balance Sheet Debt is comprised of short and long term debt.
21
As the project nears completion, capital expenditures will decrease significantly.
Page 22
CAPITAL PLAN
The capital budget for the Port Mann/Highway 1 Improvement Project is $3.319 billion. This includes the construction
cost of the design build contract with Kiewit/Flatiron General Partnership as well as interest charges, land rights
payments, tolling infrastructure development and project management costs. In addition to the PMH1 project above,
minor expenditures relating to road rehabilitation (post project completion) and technology upgrades of approximately
$1-2 million per annum are included in the capital plan.
Except for the injection of $150 million of Provincial equity, financing for all capital and operating expenditures will be by
way of the assumption of debt. All debt assumed as well as operating costs will be repaid over the term of the
Concession Agreement from tolls collected from users.
Page 23
CONTACT INFORMATION
For further information please contact:
Transportation Investment Corporation
Corporate Head Office:
Suite 210 – 1500 Woolridge Street
Coquitlam, B.C. V3K 0B9
Office: 778-783-1200
Website: www.pmh1project.com
doc_831972057.pdf
TI Corp met its goals outlined in the previous service plan for ensuring construction proceeds on schedule and on budget. Following review of its initial year of operations, the organization's performance measures have been selected to reflect TI Corp's conservative and prudent approach to financial management and its strategies to meet its long-term obligations. Measures of TI Corp's operational efficiency customer, service and employee engagement have been refined, updated and bench-marked to reflect operational observations in this first year of operations.
Page 1
TABLE OF CONTENTS
MESSAGE FROM THE CHAIR ................................................................................................................................................... 2
ACCOUNTABILITY STATEMENT ............................................................................................................................................... 3
ORGANIZATIONAL OVERVIEW ................................................................................................................................................ 4
TI CORP LOCATIONS ................................................................................................................................................................ 6
CORPORATE GOVERNANCE..................................................................................................................................................... 7
STRATEGIC CONTEXT ............................................................................................................................................................... 8
RISKS ...................................................................................................................................................................................... 10
GOALS, STRATEGIES, PERFORMANCE MEASURES AND TARGETS ........................................................................................ 12
GOVERNMENT’S LETTER OF EXPECTATIONS ........................................................................................................................ 19
SUMMARY OF FINANCIAL OUTLOOK .................................................................................................................................... 21
CAPITAL PLAN ........................................................................................................................................................................ 22
CONTACT INFORMATION ...................................................................................................................................................... 23
Page 2
MESSAGE FROM THE CHAIR
To: The Honourable Todd Stone, Minister of Transportation and Infrastructure
Dear Minister:
On behalf of the Board of Directors of Transportation Investment Corporation (TI Corp), I am pleased to provide our
Service Plan for 2014/15 – 2016/17.
TI Corp met its goals outlined in the previous service plan for ensuring construction proceeds on schedule and on
budget. Following review of its initial year of operations, the organization’s performance measures have been selected
to reflect TI Corp’s conservative and prudent approach to financial management and its strategies to meet its long-term
obligations. Measures of TI Corp’s operational efficiency customer, service and employee engagement have been
refined, updated and benchmarked to reflect operational observations in this first year of operations.
The first year of operations on the new Port Mann Bridge highlighted TReO, TI Corp’s sustainable all electronic tolling
system. A successful driver registration campaign emphasized the easy, electronic and efficient tolling system and
highway improvements opened west of the Port Mann Bridge, doubling the time savings for drivers.
Expectations for ongoing traffic fluctuation on the Highway 1 corridor are a result of new options for commuters and
goods movers, including the improved Highway 1 and the new Highway 17, or South Fraser Perimeter Road, which
connects to three untolled crossings. Commuters can also consider the newly connected Highway 1 HOV network or the
ExpressBus over the Port Mann Bridge, which sees more than 50,000 riders per month.
Looking ahead through the service planning period, TI Corp’s activities will focus on the continued delivery of the Port
Mann/Highway 1 Improvement Project, the largest transportation infrastructure project in B.C. history and the
operation of a free-flow tolling system with approximately 2 million unique customers on an annual basis. The planning
focus for 2014/15 will include maintaining best-in-class service levels, employee engagement and reducing operating
costs all while improving levels of operational efficiency.
Risks to TI Corp over the service planning period are any factors that could affect traffic volumes and corridor reliability
or safety. To mitigate these risks, TI Corp updated its traffic and financial forecasts after engaging an independent traffic
forecast firm. Additionally, the successful opening of new highway lanes have provided drivers with the project’s full
time savings and will ensure any remaining finishing work does not impact corridor reliability or predictability. All risks
have an associated management strategy, and with ongoing monitoring, present only a low to moderate risk to TI Corp.
Grant Main
Chair, Board of Directors
Page 3
ACCOUNTABILITY STATEMENT
The 2014/15 – 2016/17 Transportation Investment Corporation Service Plan was prepared under the direction of the
Board of Directors in accordance with the Budget Transparency and Accountability Act, the BC Reporting Principles, and
the 2014/15 – 2016/17 Crown Corporation Service Plan Guidelines. The plan is consistent with government’s strategic
priorities and its fiscal plan. The Board is accountable for the contents of the plan, including what has been included and
how it has been reported.
To the best of our knowledge the significant assumptions, policy decisions, events and identified risks are current and
have been considered in preparing this plan. Performance measures are consistent with TI Corp’s mandate and goals,
and focus on aspects critical to the corporation’s performance. Targets in the plan have been determined based on an
assessment of TI Corp’s operating environment, forecasting assumptions and risks.
Grant Main
Chair, Board of Directors
Page 4
ORGANIZATIONAL OVERVIEW
Mandate and Enabling Legislation
Transportation Investment Corporation (TI Corp) was established under the Transportation Investment Act. TI Corp’s
primary mandate as part of the Province’s Gateway Program is to manage and ensure successful delivery and
implementation of the Port Mann/Highway 1 Improvement Project.
TI Corp is also mandated to recover the capital costs of the project as well as operating and maintenance costs of the
bridge and highway.
Our Vision
To develop and implement self?sustaining infrastructure projects for the benefit of British Columbians.
Our Values
The corporation values the diversity of its employees and will strive to deliver projects in a manner that is respectful to
residents, businesses, communities, all levels of government and the environment, while ensuring the safe and efficient
movement of people and goods.
Core Business Areas and Services
TI Corp is a Crown corporation tasked with the delivery of the Port Mann/Highway 1 Improvement Project. This includes
construction of the new bridge and highway improvements, implementation and management of the tolling operations
and repayment of the project costs. All electronic tolling on the new Port Mann Bridge is paying for the design,
construction, financing and operation of the improvements to the Port Mann/Highway 1 corridor.
The Port Mann/Highway 1 project uses a free-flow, open road tolling system; a safer and more efficient method of
tolling than traditional toll booths. The system is easy, electronic and efficient and based on the principle of superior
customer service.
Fully electronic tolling means exhaust emissions from idling cars at toll booths are eliminated and bridge users do not
need to worry about exact change or delays. Instead, electronic decals and video capture technology identify vehicles as
they pass under the toll gantry at the south end of the bridge. Bridge users may choose to pay before or after travel
using a variety of payment methods, including online at www.treo.ca, by phone or in person at self-serve kiosks or
Customer Service Centres.
Highway 1 is the most economically critical route in Greater Vancouver. Built in the early 1960s when the population of
Metro Vancouver was 800,000, it now serves as the most important east-west corridor to the region’s 2.2 million
people.
The Port Mann/Highway 1 project is British Columbia’s largest transportation infrastructure project and a key
component of the Province’s Gateway Program. The Port Mann is a major crossing over the Fraser River forming part of
Highway 1 between Coquitlam and Surrey. The new 10-lane bridge, expanded high occupancy vehicle (HOV) network,
Page 5
transit priority facilities and a widened Highway 1 will help cut round-trip travel times in this corridor by up to 50 per
cent, and has allowed for public transit over the crossing for the first time in over 25 years.
The Gateway Program was established as part of a broader response by the Province of British Columbia to reduce
congestion, improve the movement of people and goods, and improve safety and reliability on key highway corridors.
The Gateway Program improvements will complement other regional road and transit improvements currently planned
or under construction.
The Port Mann/Highway 1 Improvement Project includes construction of the new Port Mann Bridge, widening the
highway, upgrading interchanges and improving access and safety on Highway 1. The project spans a distance of
approximately 37 kilometres from the McGill Street Interchange in Vancouver to 216th Street in Langley. Taken
together, these improvements will help create a comprehensive and effective transportation network for Greater
Vancouver, which will improve the movement of people and goods, facilitating economic growth, increased
transportation choices and improved connectivity to areas designated for population growth.
The goals of the Port Mann/Highway 1 Improvement Project are as follows:
? Reduce congestion and travel times
? Improve safety and accessibility
? Facilitate expanded public transit service
? Expand the transportation network to better accommodate high occupancy vehicles (HOV), cyclists and
pedestrians
As a result of this project, TransLink’s ExpressBus service over the Port Mann Bridge connects New Westminster at the
Braid SkyTrain Station to the newly constructed Carvolth Exchange in Langley in about 22 minutes, and current ridership
is approximately 50,000 riders per month.
Partners, Clients, Stakeholders
TI Corp’s key responsibilities are to pay for the Port Mann/Highway 1 Improvement Project within the prescribed time
period, and the ongoing management and oversight of the design-build contractor and their activities, ensuring that
construction proceeds on budget and on time with minimal disruption to road and bridge users.
Our key partners include:
• Ministry of Transportation and Infrastructure/BC Transportation Financing Authority
• Municipalities adjacent to the corridor
• Insurance Corporation of British Columbia
• TransLink
• Kiewit/Flatiron General Partnership
• Trans Canada Flow Tolling Inc. (TC Flow)
• Sanef ITS Inc.
• Mainroad Infrastructure Management Limited Partnership
Page 6
Key stakeholders and clients include tolling customers, businesses and industries that will benefit from the project
improvements and those providing advice and input:
• The travelling public, TI Corp’s customers
• RCMP and other first responders
• First Nations
• Businesses
• Commercial trucking, service companies and drivers
• Businesses and residents located adjacent to the project corridor
Additional information about the Gateway Program and TI Corp can be accessed at the following website links:
http://www.gatewayprogram.bc.ca
http://www.pmh1project.com
More information about open road tolling and TReO, TI Corp’s customer service brand, is available here:
http://www.treo.ca
TI CORP LOCATIONS
TI Corp operates TReO Customer Service Centres in Surrey and Coquitlam. These locations are conveniently located
close to the highway so drivers can pay their tolls or receive customer service before or after they travel.
TI Corp also operates a construction project office with project personnel in the field daily along the
37 kilometers of highway improvements.
Corporate Head Office:
Suite 210 – 1500 Woolridge Street, Coquitlam, B.C. V3K 0B9
Project Office:
Suite 200 – 145 Schoolhouse Street, Coquitlam, B.C. V3K 4X8
TReO Coquitlam Customer Service Centre:
2nd floor, 1500 Woolridge Street, Coquitlam, B.C. V3K 0B9
TReO Surrey Customer Service Centre:
16300 – 104 Avenue, Surrey, B.C. V4N 1Y5
Page 7
CORPORATE GOVERNANCE
By legislation, TI Corp is governed by a Board of Directors appointed by the Lieutenant Governor in Council. The Board of
Directors, through the Chair, reports to the Minister of Transportation and Infrastructure (designated as the Minister
Responsible for TI Corp) and is responsible for overseeing the conduct of business, directing management and ensuring
that all major issues affecting TI Corp’s affairs are given appropriate consideration.
The Board of Directors adheres to the following Corporate governance principles, which are set in accordance with Part
2 “Best Practices Guidelines: Governance” of the Province’s Governance and Disclosure Guidelines for Governing Boards
of British Columbia Public Sector Organization:
? Act in the best interests of the Corporation
? Develop, maintain and adhere to terms of reference for the Board, Chair, Directors and Committees
? Ensure there is a planning process, to become engaged in the process, and then review, question, validate and,
ultimately, endorse the Service Plan and monitor performance
? Follow the board-approved TI Corp Governance Guidelines
As a Crown agency, TI Corp operates under a Government Letter of Expectations that outlines both the corporation’s as
well as the shareholder’s responsibilities, and is jointly signed by the Minister of Transportation and Infrastructure and
the Chair of TI Corp.
TI Corp’s Board of Directors follows the governance practices contained in the Board Resourcing and Development
Office (BRDO) corporate governance guidelines. More information regarding TI Corp Board governance can be found at:
http://www.pmh1project.com/about-the-project/about-ti-corp/Pages/Financial-Reporting.aspx.
As a public Crown corporation and part of the Government of British Columbia’s Public Sector Employer’s Council (PSEC),
TI Corp operates under PSEC’s best practices for transparent and full disclosure of public sector executive compensation.
The Board of Directors currently consists of:
Chair - Grant Main
Member - Larry Blain
Member - Don Fairbairn
Committees
In November 2013 the Board established an Audit and Risk Committee to replace the existing Operations Committee.
This reflects TI Corp’s continuing shift away from construction operations and towards toll operations. Members are:
Don Fairbairn, Chair
Larry Blain, Member
Mike Proudfoot, Ex-officio Member
Officers
Mike Proudfoot, Chief Executive Officer
Garry Dawson, Vice President, Technical Services
Patricia Soanes, Vice President, Finance and Corporate Services
Mahrokh Arefi, Vice President, Tolling
Page 8
STRATEGIC CONTEXT
Operating Environment
With the opening of the new Port Mann Bridge in December 2012 and the opening of new Highway 1 lanes through
Coquitlam, Burnaby and Vancouver in December 2013, drivers are experiencing the time savings promised by the Port
Mann/Highway 1 Improvement Project.
For the first year after the bridge opened, the tolling framework provided a substantially reduced toll rate for drivers
who registered for a TReO tolling account, installed a windshield decal, and provided a payment mechanism for
automatic payment. This introductory toll rate recognized that drivers had begun to experience significant travel time
savings and that those time savings would increase when construction west of the bridge opened new lanes.
This tolling framework was established to promote the use of windshield decals, which are more reliable and accurate
than licence plate recognition, and to promote automatic payment, a much more efficient method of toll collection.
Immediately following the opening of new Highway lanes and the introduction of the full rate in January 2014, TI Corp
has seen a significant increase in travel time savings with drivers saving up to an hour a day. Those time savings are
highest during the rush hours, leading to significantly higher traffic during the morning and afternoon peak periods. The
biggest increase in traffic volumes has been in the westbound direction in the morning, which is up more than 10%
compared to 2013, indicating the significant time savings are attractive to drivers. Also, truck traffic using the Port Mann
Bridge has increased significantly since it opened. On average during the month of January 2014, 1100 more trucks
crossed the bridge than the same time in January 2012, an increase of 14%.
Significantly improved options for commuters have contributed to ongong traffic fluctuation on the corridor. The
ExpressBus from Langley over the Port Mann Bridge has a growing ridership of more than 50,000 passengers per month,
and drivers are also taking advantage of the newly connected Highway 1 HOV network. In addition to the opening of
new Highway 1 lanes west of the Port Mann Bridge, the completion of the new Highway 17 (South Fraser Perimeter
Road) provides connections to three untolled crossings over the Fraser River.
TI Corp will continue to monitor the use of alternate routes, but traffic fluctuation is expected to continue for several
months and is mirroring the experience seen in other jurisdictions where tolling is more prevalent.
The 2014/15–2016/17 service planning period will focus on two major accountabilities:
1. The continued delivery of the Port Mann/Highway 1 Improvement Project, the largest transportation
infrastructure project in B.C. history
2. Operation of a free-flow tolling system serving approximately 100,000 – 120,000 vehicles per day with
approximately 2 million unique customers on an annual basis
TI Corp’s objectives, detailed in the following pages, are reflective of these two primary accountabilities. Following its
first year of operations of the toll system, TI Corp continues to refine its benchmarks. The 2014/15 – 2016/17 Service
Plan contains objectives included in previous service plans, specific to construction of the PMH1 Project. The service plan
also continues the development of new goals to manage and measure the organization’s performance with respect to
the operation of the tolling system.
TI Corp’s priorities are to ensure the safe and reliable movement of traffic and goods along the Port Mann/Highway 1
corridor, the operation of a self-sustaining and financially stable organization, the provision of superior customer service
and engagement of a skilled and motivated workforce.
Page 9
The key strategic issues and risks for TI Corp are any factors that could affect traffic volumes and revenues, its role as a
self-sustaining financially stable organization, corridor reliability or safety, construction schedule and budget.
In addition, TI Corp is addressing the risk that road conditions or traffic incidents along the corridor will affect potential
travel time savings or anticipated safety benefits. To do so, an updated incident management procedure has been
implemented to ensure any motor vehicle incidents are dealt with quickly and efficiently, with full lane capacity
returned promptly. Also, to prevent travel lane or bridge closures associated with inclement weather, an updated
weather monitoring protocol has been implemented. In addition, measures to address ice build-up on the cables were
implemented in advance of winter 2013/14.
The above noted strategic issues and risks, including economic, demographic and market factors that could impact
performance in the service planning period are accounted for in TI Corp’s risk management planning.
Organizational Capacity
TI Corp has the required capacity to meet its key objectives for the 2014/15 fiscal year.
? Deliver the Port Mann/Highway 1 Improvement Project on time and on budget
? Ensure the safe and reliable movement of traffic and goods along the Port Mann/Highway 1 corridor
? Operate a self-sustaining and financially stable organization
? Provide superior customer service
? Engage a workforce that drives operational success
The design-build contractor is responsible for the on time and on budget delivery of the Port Mann/Highway 1
Improvement Project and its related benefits.
The tolling operator is responsible for the day-to-day tolling operations, including customer service, helping customers
set up accounts, answering questions about account options and programs, billing and accepting payments in person, by
phone and online.
TI Corp will be responsible for ensuring both the design-build contractor and the tolling operator meet prescribed
standards and timelines and its workforce provides the operational oversight that helps ensure the financial stability of
the organization.
Page 10
RISKS
Risk management is implicit in TI Corp’s management methodology. Key risk management principles include:
• Immediate communication of identified risks
• Proactive risk mitigation
• Continual review
• Appropriate allocation of risks to relevant parties
All risk identified in this table have an associated management strategy. Together with these strategies outlined below
and ongoing monitoring, no risk presents more than a low to moderate potential impact to TI Corp.
Key Strategic Issue Status and Potential Impacts Risk Mitigation
Project cost escalation:
? Debt borrowing costs
? Project schedule and
budget
TI Corp is maintaining a mix of
both long term and short term
debt in accordance with the
2009 debt financing strategy.
This mix enables the company to
conservatively take advantage
of short term interest rates to
reduce borrowing costs.
The Project is currently on
schedule and on budget. The
opening of Phase One
improvements and completion
of tolling components was
achieved on schedule in
December 2012. Phase Two
improvements opened to traffic
in December 2013. Final
finishing work will continue
through 2014. This work
primarily involves completion of
the final two lanes of the Port
Mann Bridge, which are
required for future capacity.
Regular cash flow monitoring, analysis and
reporting, inclusive of debt strategies, are
conducted on an ongoing basis. TI Corp
has locked in long term debt at a
favourable rate to minimize borrowing
costs as appropriate.
Risks associated with interest rate
fluctuations over the course of the project
are mitigated through the use of a long-
term hedging strategy.
TI Corp has entered into a design-build
agreement with the contractor that
requires the contractor to meet specific
costs and dates for the delivery of specific
elements of the project.
The design-build agreement places
responsibility for construction-related cost
overruns with the contractor for those
activities under its direct control.
Ongoing monthly monitoring of
construction progress is undertaken to
achieve schedule certainty and mitigate
cost pressures.
Page 11
Tolling:
? Public acceptance of
tolling operation
? Use of alternative
crossings
? Long-term traffic volume
fluctuations
Customer account registration
has exceeded forecasts. More
than one million vehicles have
registered with TReO and more
than 80-85% of regular users are
signed up, a measure which is
best-in-class for the tolling
industry internationally.
Risk of traffic diversion to other
parts of the region.
Risk that volumes will be
substantially lower than
forecasted would have financial
consequences.
The base toll rate was introduced in
January 2014 after a full year of a half-
price introductory toll rate for the
majority of users.
The framework is supported by a public
communication and engagement plan to
raise awareness of the expiry of the
introductory toll rate and the travel time
savings afforded by the project.
Time savings delivered by new, improved
highway lanes and the communications
plan described above encourage drivers to
use the new bridge and widened highway.
Efforts to promote travel time savings, and
enhance time savings with continued
highway improvement will continue to
mitigate diversion to alternate routes.
TI Corp is continually updating its traffic
forecasts to account for recent traffic
patterns, fuel prices and economic
conditions. These traffic projections have
been used to develop internal financial
modeling and forecasting.
Ongoing monitoring of traffic volumes and
usage patterns allows for updates to
financial forecasts and development of
mitigation plans as required.
Reliability and safety:
? Improved corridor
reliability and safety
Risk that road and weather
conditions or traffic incidents
along the corridor will affect
potential travel time savings or
anticipated safety benefits.
An incident management procedure is in
place to respond to any motor vehicle
incidents quickly and efficiently to restore
traffic flow.
To prevent traffic disruptions associated
with inclement weather, an updated
weather monitoring protocol has been
implemented. In addition, measures to
address ice build-up on the cables was
refined and implemented in advance of
winter 2013/14.
Page 12
GOALS, STRATEGIES, PERFORMANCE MEASURES AND TARGETS
As noted above, the 2014/15 – 2016/17 reporting period builds on the significant operational changes made by TI Corp
in the 2013/14 – 2015/16 service plan.
As the organization looks ahead to the completion of construction activities, TI Corp’s goals have shifted to better reflect
the continued operation of an open road tolling system, the provision of services and benefits based on best practices
used by similar tolled bridges and roadways, and the operation of a sustainable and financially stable organization.
As TI Corp moves further from construction to operations, this process will continue and organizational objectives will be
refined.
Goal 1: Deliver the Port Mann/Highway 1 Improvement Project on time and on budget
A key function of TI Corp is the ongoing management and oversight of the design-build contractor and its activities,
ensuring construction proceeds according to schedule and remains on budget.
Strategies
A design-build agreement has been signed between TI Corp and the Kiewit/Flatiron General Partnership. Under this
structure, the contractor is required to meet specific dates for the delivery of certain elements of the project.
To achieve these goals, TI Corp has set completion targets by fiscal year and measures progress against these targets.
The design-build agreement structure places responsibility for construction-related cost overruns with the contractor for
those activities under its direct control.
To achieve these goals, TI Corp has set specific financial targets and measures all streams of activity by fiscal year and
measures progress against these targets.
Performance Measures
1
The 97% completion figure recognizes an updated forecast total spend of $3,236 million in 2013/14 out of a total project budget of
$3,319 million.
2
This performance measure will no longer be relevant at the end of construction and will be superseded by new operations-based
targets.
Performance
Measures
2012/13
Actual
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Achieve percentage
of completion target
for total design &
build construction
91% 97%
1
100% N/A
2
N/A
Page 13
Performance Management
The design-build contractor reports regularly to TI Corp on project progress and the percentage of completion is derived
from an estimate of the progress of the particular segments of the project using verified progress billings.
The data used to measure financial performance is contained in TI Corp’s annual financial statements, which are subject
to annual independent audit. TI Corp has received an unqualified audit each year it has been in operation.
Goal 2: Ensure the safe and reliable movement of traffic and goods along the
Port Mann/Highway 1 corridor
Key goals of the Port Mann/Highway 1 Improvement Project are the reduction of congestion and travel times along the
project corridor, improved safety and accessibility, expanded transit service and an expanded transportation network to
better accommodate high occupancy vehicles (HOV), cyclists and pedestrians.
This was a new goal for 2013/14 and reflects TI Corp’s shift in roles from a construction focus to that of an operational
service provider to customers and stakeholders along the Port Mann/Highway 1 corridor.
Strategies
TI Corp’s strategies to implement these benefits along the new Port Mann/Highway 1 corridor will include:
? Managing corridor reliability and travel time predictability
? Ensuring corridor efficiency, and minimize disruptions to traffic flow
Performance Measures
Corridor Travel Time Savings
To benchmark this performance measure, sample routes, noted below, were driven in the 2012/13 reporting period
before Port Mann/Highway 1 improvements were opened to traffic. Travel times were measured in prevailing conditions
by an independent traffic engineering firm. Routes were traveled several times to estimate the average travel time.
Forecasts and targets for these routes will be analyzed after the opening of all new Highway 1 lanes to accurately
measure the travel time savings associated with the Port Mann/Highway 1 Improvement Project.
The target for the performance measure is a 30% travel time saving, as in the Gateway Program Definition Report,
published during the PMH1 Project planning phase. Travel time estimates generated since then have indicated that
3
The forecasted 2013/14 spend of $3,236 million is revised from an earlier forecast of $3,270 million.
4
This performance measure will no longer be relevant at the end of construction and will be superseded by new operations-based
targets.
Performance
Measures
($Millions)
2012/13
Actual
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Remain within the
approved $3,319
Capital Budget
$2,997 $3,236
3
$3,319 N/A
4
N/A
Page 14
travel time savings as high as 50% are possible with a new Port Mann Bridge and widened Highway 1. These updated
estimates have informed the development of this performance measure.
Corridor Incident Prevention
A key objective of the Port Mann/Highway 1 Improvement Project is to improve the safety and efficiency of the highway
corridor. Improved interchanges, new merging lanes, dedicated on and off-ramps and an overall reduction in congestion
will all contribute to a safe and efficient corridor.
During the 2013/14 service plan period, TI Corp developed new performance standards to measure the safety and
efficiency of the PMH1 corridor. To compare collision data from the improved Highway 1 to data from the original
corridor, information was gathered from the British Columbia Ministry of Transportation and Infrastructure’s Collision
Information System
9
. The data used to develop the baseline is from the five years prior to the commencement of PMH1
construction; 2004/05 to 2008/09.
Forecasts are a conservative value based on collision data from 2013/14 on the improved sections of Highway 1 through
Langley, Surrey and the Port Mann Bridge. It is anticipated that projections may change over time as TI Corp reviews
observed data on comparable corridors as well as the PMH1 improvements.
5
Round trip travel times are based on westbound AM and eastbound PM total travel times.
6
Route 1: 152 Street at 108 Avenue, Surrey to/from United Boulevard at Lougheed Highway, Coquitlam.
7
Route 2: 200 Street at 80 Avenue, Langley to/from Boundary Road at Grandview Highway, Vancouver.
8
Route 3: 176 Street at 96 Avenue, Surrey to/from Brunette Avenue at Lougheed Highway, Coquitlam.
9
The Collision Information System database is populated by collision information gathered by police incident reports on the
provincial roadways and received from ICBC.
Performance
Measures
Pre-construction
Roundtrip
5
Actual
(Benchmark)
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Route 1
6
152 Street
to/from
United Boulevard
0:23
30% - 40%
savings
40% - 50%
savings
50% savings 50% savings
Route 2
7
200 Street to/from
Grandview
Highway
1:47
30% - 40%
savings
40% - 50%
savings
50% savings 50% savings
Route 3
8
176 Street to/from
Brunette Avenue
0:52
30% - 40%
savings
40% - 50%
savings
50% savings 50% savings
Page 15
Goal 3: Operate a self-sustaining and financially stable organization
The Port Mann/Highway 1 Improvement Project is a self-funding project using all electronic, open road tolling
technology. The Concession Agreement between the Province and TI Corp requires the Corporation to repay the
Port Mann/Highway 1 Improvement Project debt by 2050 and meet the operations, maintenance and rehabilitation
needs as well as undertake any necessary future improvements.
As such, it is TI Corp’s responsibility to ensure a sustainable, long term source of revenue and demonstrate the
cost-effective management of operations. TI Corp will ensure it remains financially stable by implementing operational
efficiencies and controlling administrative costs, thereby keeping tolls low for customers.
During the long-term planning phase of the Port Mann/Highway 1 Improvement Project, several traffic forecasts were
developed, including those of private sector bidders during the project’s competitive selection process. Those forecasts
indicated that based on the expected growth of the Lower Mainland’s population, and the associated traffic growth, it
would take approximately 40 years to meet all of the financial obligations associated with the project. As a result a
tolling period expiring in 2050 was established.
TI Corp has established financial metrics that set out the requirements and objectives for the organization. A full
financial report is included in the Summary of Financial Outlook in this Service Plan, but this selection highlights annual
revenue targets laid out in the organization’s long term plan.
10
Traffic incidents tracked in this performance measure are on the PMH1 corridor from 216 Street in Langley to McGill Street in
Vancouver.
Performance
Measures
Preconstruction
Baseline
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Vehicle collisions on the
PMH1 corridor
10
680 collisions
20%
reduction
from
baseline
25%
reduction
from
baseline
25%
reduction
from
baseline
25%
reduction
from
baseline
Page 16
($ Millions)
11
2012/13
Actual
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Revenue
12
15 98 144 159 174
Administration Expenses
13
12 9 9 8 8
Operating Profit/(Loss)
(27) 49 104 120 135
Annual revenue targets have been set that show a year after year increase in revenues through careful financial
management, and that correspond with increasing traffic volumes on the Port Mann Bridge. At the same time,
administrative expenses have been capped to limit overhead growth.
TI Corp is on track to meet all financial obligations by 2050. To ensure it remains on track, traffic forecasts are reviewed
from time-to-time and compared against observed traffic volumes. TI Corp will continue to update forecasts for the Port
Mann Bridge and Highway 1 corridor.
The operation of a self-sustaining and financially stable organization was a new goal for 2013/14 and reflects TI Corp’s
shift in roles from a construction focus to that of an operational service provider to customers and stakeholders along
the Port Mann/Highway 1 corridor.
Strategies
TI Corp’s strategies to operate a self-sustaining and financially stable organization include:
? Repay the Port Mann/Highway 1 Improvement Project debt within the prescribed time period
? Implement operational efficiencies and control administrative costs to keep costs low for TI Corp and tolls low
for customers
Performance Measures
Operational Efficiency
A key measure of operational efficiency for an open road tolling system is the number of registered customers, and the
percentage of customers with registered accounts. Registered accounts with windshield decals and payment
mechanisms on file are most efficient and cost effective because they are more accurate and payment is fully
automated, meaning invoicing and reconciliation is not required.
11
All figures have been rounded to millions of dollars ($M) which results in rounding additions not always being consistent.
12
Revenue for 2012/13 represents four months of tolling operations commencing in December 2012.
13
Administration Expenses includes communications, salaries, facilities costs and other corporate overhead.
Page 17
TI Corp’s goal is to have 80-85% of regular users registered, which is consistent with best-in-class industry standard.
Goal 4: Provide superior customer service
Superior customer service has always been one of TI Corp’s key priorities. As construction winds down, TI Corp’s annual
customer satisfaction survey has transitioned to measure customer attitudes towards the toll system and TReO, TI
Corp’s consumer-facing brand. The toll operator, TC Flow Inc., was selected in part because of its demonstrated
experience and commitment to customer service.
In any given month, the TReO Customer Service Centres receive more than 46,000 phone calls, 3,600 walk-in customers
and respond to approximately 4,000 customer emails and letters. To ensure the toll operator maintains a satisfactory
level of service, its performance is measured on key indicators of customer service.
Strategies
TI Corp’s strategies to provide continued superior customer service include:
? Operate a toll system that is easy, electronic and efficient for customers
? Ensure customers receive superior service through meeting established performance measures
Performance Measures
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
Percentage of telephone calls
answered within 20 seconds
80% 80% 80% 80%
Number of customer service
complaints as a share of Port
Mann crossings
1/10,000 1/10,000 1/10,000 1/10,000
Overall level of satisfaction
with the toll system and
customer service
80-85% 85% 85% 85%
Overall level of satisfaction
with the Port Mann/Highway 1
improvements
80-85% 85% 85% 85%
Performance
Measures
2013/14
Target
2014/15
Target
2015/16
Target
2016/17
Target
% of regular users
with registered
accounts
80-85% 80-85% 80-85% 80-85%
Page 18
Performance Management
These performance measures are derived from the key performance indicators in the toll operator agreement. Annual
surveys of TReO customers are conducted by TI Corp to reflect its customer service responsibilities.
Goal 5: Engage a workforce that drives operational success
TI Corp requires a highly qualified, diverse and flexible workforce in order to provide reliable, customer-oriented service
for commuters and stakeholders that rely on the Port Mann/Highway 1 corridor.
Strategies
TI Corp’s strategies to engage its workforce and drive operational success include:
? Supporting and investing in its employees
? Fostering a culture of fiscal responsibility, teamwork and innovation
Performance Measures
TI Corp monitors success in leading an engaged workforce through its annual spring employee survey, which covers a
broad range of attributes including performance management and employee engagement. TI Corp’s forecast for success
in terms of employee satisfaction mirrors TI Corp’s own benchmarks for customer satisfaction, which are derived from
the key performance indicators in the toll operator agreement.
The target for 2014/15 has been set at “previous result +2%” to reflect both the previous result and the desired level of
continuous improvement to the score.
Performance Measures
2013/14
Forecast
2014/15
Target
2015/16
Target
2016/17
Target
Employee satisfaction with
TI Corp as an employer of choice
that invests in and supports its
employees.
85%
Previous
result +2%
TBD
TBD
Performance Management
Performance is measured using the organization’s annual employee engagement survey conducted each spring.
Page 19
GOVERNMENT’S LETTER OF EXPECTATIONS
The Government’s Letter of Expectations, between the shareholder (the Government of British Columbia) and TI Corp, is
an agreement on the respective roles and responsibilities of each, and serves as the basis of agreement between the
shareholder and the Corporation on corporate mandate including high-level performance expectations, public policy
issues and strategic priorities.
GLE Direction
Transportation Investment Corporation
Alignment
Manage and ensure the delivery and
implementation of the design build work on the
Port Mann/Highway 1 Improvement Project, all in
accordance with the terms of the design build
agreement dated as of March 17, 2009, signed
between Transportation Investment Corporation
(TI Corp) and Kiewit/Flatiron General Partnership,
the contractor.
TI Corp continues to manage and ensure the quality
of work done by the design-build contractor.
On December 1, 2012, Phase One of the Port
Mann/Highway 1 Improvement Project was
completed and opened on schedule. With the
opening of the new bridge and highway widening
between Langley and Coquitlam completed, drivers
began to experience significant travel time savings.
Phase Two of the project, which includes highway
widening and interchange improvements from
Coquitlam to Vancouver, opened to traffic in
December 2013.
Operate and manage a tolling system and toll
collections at the Port Mann Bridge, consistent with
the provisions of the Port Mann / Highway 1
Concession Agreement signed on March 10, 2010,
between the Province, BCTFA and TI Corp and any
future modifications to this agreement.
Trans-Canada Flow Tolling, the Port Mann/Highway
1 tolling operator, commenced operations during
the summer of 2012.
Registration for TReO tolling accounts exceeded
expectations with more than one million vehicles
registered by December 2013. TI Corp’s registration
drive has been recognized internationally as best-
in-class for a new open road tolling system.
Work with the Ministry of Transportation and
Infrastructure (the Ministry) to ensure financial
targets and reporting requirements, as identified in
the Ministry Budget Letter to TI Corp, are met.
Inform the Ministry in a timely manner of any
pressures in meeting these financial targets and the
related mitigation strategies.
TI Corp is committed to managing and meeting the
financial targets outlined in this Service Plan.
Regular dialogue and meetings between TI Corp
and the Ministry ensure communication regarding
financial reporting is frequent and timely.
TI Corp submits quarterly financial statements,
capital expenditures and debt forecasts.
Page 20
Fulfill any other obligations consistent with the
provisions of the Concession Agreement.
Transportation Investment Corporation continues
to fulfill its obligations under the Concession
Agreement.
In addition to the appropriate management of
revenue and expenses, TI Corp continues to look
for opportunities to ensure tolls are kept as low as
possible for families, commuters and businesses.
This includes an unlimited monthly pass for very
frequent users, a peak period 25% discount for high
occupancy vehicles and a 50% discount for large
trucks travelling between 9PM and 5 AM.
In addition to the direction contained in TI Corp’s Government Letter of Expectations, TI Corp and the PMH1
Improvement Project also play a role in the Province’s climate change goals, by reducing greenhouse gases associated
with congestion-induced idling and traffic delays, as well as by making public transit across the Port Mann Bridge
possible for the first time in more than 25 years.
Highway 1 ExpressBus service is providing transit service between the Carvolth Exchange in Langley and Braid SkyTrain
Station as fast as, or faster, than travelling by car. Popularity of the ExpressBus service is growing and 50,000 riders
currently use the service per month.
Page 21
SUMMARY OF FINANCIAL OUTLOOK
The Concession Agreement requires TI Corp to repay the Port Mann/Highway 1 Improvement Project debt by 2050. As
such, TI Corp has taken a prudent, long-term approach to financial management. In 2013/14, TI Corp engaged an
independent firm to assist with traffic forecast estimates to better reflect the long-term economic conditions of the
Metro Vancouver area and meet the obligations in the Concession Agreement.
($ Millions)
14
2012/13 2013/14 2014/15 2015/16 2016/17
Actual Target Target Target Target
Revenue
15
15 98 144 159 174
Operating Expenses
16
22 28 20 20 20
Highway Operations and
Maintenance
17
8 12 11 11 11
Administration Expenses
18
12 9 9 8 8
Operating Profit/(Loss) (27) 49 104 120 135
Interest Expense
19
25 107 131 148 158
Depreciation Expense 8 31 52 52 53
Net Income/(Loss) (60) (89) (79) (80) (76)
Total Balance Sheet Debt
20
2,794 3,452 3,608 3,615 3,616
Retained Earnings/(Deficit) (135) (224) (303) (383) (459)
PMH1 Project Expenditure
21
540 239 83 - -
14
All figures have been rounded to millions of dollars ($M) which results in rounding additions not always being consistent.
15
The main source of revenue is from tolling and 2012/13 represents four months of tolling operations commencing in December
2012.
16
Operating Expenses include toll operator and system operations, ongoing operating expenses including quality monitoring and
assurance programs as well as certain costs relating to the decommissioning of the old Port Mann Bridge.
17
Highway Operations and Maintenance costs include the third party service contractor Mainroad Infrastructure Maintenance LP,
and services provided by the Ministry of Transportation and Infrastructure.
18
Administration Expenses includes communications, salaries, facilities costs and other corporate overhead.
19
Depreciation and Interest expenses increase as various segments of the bridge and associated roadways are completed and made
available for use.
20
Total Balance Sheet Debt is comprised of short and long term debt.
21
As the project nears completion, capital expenditures will decrease significantly.
Page 22
CAPITAL PLAN
The capital budget for the Port Mann/Highway 1 Improvement Project is $3.319 billion. This includes the construction
cost of the design build contract with Kiewit/Flatiron General Partnership as well as interest charges, land rights
payments, tolling infrastructure development and project management costs. In addition to the PMH1 project above,
minor expenditures relating to road rehabilitation (post project completion) and technology upgrades of approximately
$1-2 million per annum are included in the capital plan.
Except for the injection of $150 million of Provincial equity, financing for all capital and operating expenditures will be by
way of the assumption of debt. All debt assumed as well as operating costs will be repaid over the term of the
Concession Agreement from tolls collected from users.
Page 23
CONTACT INFORMATION
For further information please contact:
Transportation Investment Corporation
Corporate Head Office:
Suite 210 – 1500 Woolridge Street
Coquitlam, B.C. V3K 0B9
Office: 778-783-1200
Website: www.pmh1project.com
doc_831972057.pdf