Mexico City, Mexico A.5 Lessons learned from the Ecovía bus rapid transit project in

TABLE A.4 Lessons learned from the Metrobús bus rapid transit project in Mexico City, Mexico

BEST PRACTICES

• Institutional capacity—Metrobús has a specialized agency to manage, coordinate, supervise, and evaluate the system staffed with qualified and professional personnel. [operation risk] • The Mexico City government and the World Resources Institute supported the creation of a technical unit outside the government structure, the Sustainable Transport Center (a nongovernmental organization), to design and execute transportation services and promote integrated transportation in Mexico City. [operation risk] [design risk] • Proper technical studies were conducted prior to developing the project. [design risk] • Planning and demand estimates were realistic and adequate, resulting in on-time construction of infrastructure and commencement of operations. [design risk] [construction risk] • Conflicts among existing operators were minimized with the introduction of an engagement strategy that resulted in exhaustive negotiations with existing operators to ensure their participation in the proposed project. [operation risk] [planning risk] • The government incorporated incumbents in the planning and operations of new systems and benefited from including them as partners in the project in a special-purpose vehicle. [planning risk] [operation risk] • The Mexico City government gave a “scrapping bonus” to operators for each bus retired. [operation risk] • Metrobús was successfully integrated into the city’s transportation system. [operations risk] • The system was planned and structured in such a way that special-purpose vehicle shareholders were supposed to receive returns like those obtained in prior systems. [operations risk] • Demand has risen and has saturated the system.

Development and execution of expansion plans would help to manage this situation. [design risk] • It is best to establish procedures for extending concessions.

In this case, a concession kept operating after its license had expired. [political and social risk] • Cost-reflective tariffs that remain outside of political influence should be considered whenever possible. [political and social risk] [operation risk] • Operations were begun without appropriate control and information collection systems. [operation risk] [political and social risk] • Fixed payments per kilometer were not attached to performance. [operation risk] • Payment for the maintenance and operation of buses was delayed by three payments from the revenue collection account, which could have affected the quality of service. [operation risk] [maintenance risk] • Protesters damaged buses, but the contract did not include a mechanism for operators to seek compensation for such an event. [operation risk] [political and social risk] [revenue risk] • The project suffered from a low supply of clean fuels and would have benefited from the inclusion of a penalty for the fuel supplier in case of shortages. [operation risk] • Surplus revenues (if any) that Metrobús absorbs are saved and can be used for future system development or for cross-subsidization between system lines. [planning risk] • System revenues were supposed to cover the operating costs of Metrobús, but this has never been the case. [operations risk] • Metrobús included a reserve and contingency fund—after capital and operating expenditures—but in reality, revenue generation has not been sufficient to cover any of the system’s full costs (or operating expenditures, let alone capital). [funding risk]

Source: World Bank. AREAS FOR IMPROVEMENT

2005 and 2013, leaving it unable to determine the distance covered by each bus or evaluate bus performance against schedules, preventing the accurate calculation of payments to operators. Table A.4 presents the lessons learned from the project.

ECOVÍA (MONTERREY, MEXICO)

The Ecovía case describes the development of a BRT system with exclusive lanes using the “private finance of infrastructure” PPP structure (Mehndiratta 2014). Ecovía did not achieve the expected results and demonstrates the importance of integrating incumbent service providers into new projects and ensuring that new routes cover at least what the previous system covered.

For years, Monterrey has suffered from increasing congestion and transportation costs, with 42 percent of residents traveling by car. The state government of Nuevo León sought to develop a Metropolitan Integrated Transport System (SITME) to reduce costs and reliance on personal vehicles. In 2011 the state government began developing the BRT-Ecovía as part of this SITME, which already