PROGRAM MANAGEMENT
PROGRAM MANAGEMENT OFFICE Contact: Tami Warren, PMO Manager • (714) 560-5590 The M2 PMO provides inter-divisional coordination for all M-related projects and programs. To ensure agencywide compliance, the PMO holds a bi-monthly committee meeting comprised of executive directors and key staff from each of the divisions, who meet to review significant issues and activities within the M2 programs. This quarter, the focus of the PMO has been on several major items, including the following.
Market Conditions Forecast and Risk Analysis In September 2017, the Board was presented with a Next 10 Delivery Plan Market Conditions Forecast and Risk Analysis Report conducted by Dr. Wallace Walrod and Dr. Marlon Boarnet. The consultant’s analysis identified a strong potential for OCTA to experience an increasing cost environment during the Next 10 delivery years. This, coupled with a reduction in revenue, could present the potential for significant challenges in the delivery of M2 and Next 10. Given this analysis, the Board directed staff to continue to work with the consultant to monitor and track key early warning indicators and provide the Board with updates in a timeline consistent with updates on the M2 sales tax revenue forecast. With a rapidly changing construction market, staff looked to our contracted local economists for insights to better anticipate cost implications to our freeway program delivery. The consultant team continues to analyze trends in material costs, labor costs, and general economic conditions to determine a range of potential cost impacts. This quarter, the consultant team worked presented to the Board on October 28, 2019. The results of the fall analysis concluded that OCTA may experience a cost increase of between two percent and six percent during the 2020 through 2022 time period of construction activity. To reduce the potential risk of cost pressure and project delivery slowdowns due to unanticipated cost increases, staff incorporated information from this analysis into the M2 cashflow for the 2019 updated Next 10 Delivery Plan.
Next 10 Delivery Plan On November 14, 2016, the Board adopted the Next 10 Delivery Plan (Next 10) providing staff guidance on the delivery of M2 projects and programs between 2017 and 2026. The PMO monitors the progress on the ten deliverables identified in the Plan and reports on them in this report. See pages 3-6 for the status on deliverables. Annually, OCTA reviews the M2 program assumptions and updates the cash flows and Next 10 assumptions as needed based on changes to the revenue forecast and project cost and schedule updates. The 2019 review incorporated an updated forecast of $13.4 billion (presented to the Board on October 28, 2019). The updated 2019 Next 10 Plan was presented to the Board at the November 11, 2019 meeting. The 2019 updated Next 10 identified five projects to be advanced through construction: I-605/ Katella Interchange (Project M), SR57 Northbound from Orangewood Avenue to Katella Avenue (Project G), I-5 between I-405 and Yale Avenue
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