United Nations Public Service Awards Case Studies

Alberta’s rapidly growing population has outstripped existing public infrastructure. Increasing school enrolments, combined with spiraling construction costs, created a critical need for the Government of Alberta (GoA) to devise a cost-effective and speedy method for building new schools in expanding communities. Using traditional methods (government grant-financed, private sector contracts for design-and-construction services), GoA could not possibly hope to “turn around” this urgent situation.

In 2007, Alberta Infrastructure (INFRA) ‘Ministry of Infrastructure’ developed an innovative two-part solution:

1. The “core school” initiative – core designs for schools that provide uniform high quality; enhance cost management; reduce timelines; and allow flexibility for schools to adapt to changing enrolments. They eliminate both reinventing the wheel and “leapfrogging” (incremental advances on a per-school basis) for each school design.
The Core School Designs were mandated by the GoA for all future schools in Alberta, creating designs adaptable for all school boards and most school sites within Alberta. The decision to use standard school designs for all future schools was based upon the real savings achieved by the GoA. The Core School Designs include a fixed and permanent Core Structure which incorporates functional areas such as the gymnasium, library, administration area, certain classrooms, gathering areas and project areas together with the provision of additional teaching areas through the use of Modular Classrooms to easily and economically allow for changing demographics.
The Core School Designs are the basis for the school designs for Alberta Schools Alternative Procurement (ASAP) initiatives. These designs were modified in consultation with the relevant School Boards and sites on which the schools were located were designed in consultation with the Municipalities.
2. The Alberta Schools Alternative Procurement (ASAP) initiatives – a public-private partnership (PPP) process based on a Design-Build-Finance-Maintain (DBFM) approach (a first for schools in North America). This process speeds up delivery of schools by years; creates major savings; and eliminates “deferred maintenance”.

The agreement assigned a private sector contractor the responsibility to complete the design, construct and partially finance the Project, and to maintain it for a term of 30 years following acceptance. Following availability the successful Proponent will receive monthly payments for the term of the agreement based on availability of the schools and compliance with the performance specifications.
So far GoA has initiated two projects under ASAP using the DBFM approach; in both cases ownership and education program delivery remained with the respective school boards.
By June 2010, the Government delivered a bundle of 18 schools in the Cities of Edmonton and Calgary under the ASAP I initiative. In the meantime GoA initiated another bundle to deliver 14 more schools under ASAP II of which 10 are being delivered under the PPP model; the schools are currently under construction and are expected to be completed by June 30, 2012.
The Alberta Government is presently contemplating a third bundle.

What is the initiative about? (the solution)
The GoA chose Public-Private Partnership over the conventional public sector approach for seven main reasons: cost certainty and enhanced economic value; an innovative, repeatable, transparent, accountable DBFM process; faster, guaranteed delivery; innovative risk allocation; infrastructure maintenance; across-the-board infrastructure equity regardless of school jurisdiction or location; and LEED™ (Leadership in Energy and Environmental Design) standards ensuring sustainability. Some measured benefits are as follows: • Value for Money analysis showed government saved $97 million for ASAP I and $105 million for ASAP II DBFM initiative and $28 million for ASAP II Design Build (DB) initiative; government is also anticipating savings of millions for the proposed ASAP III initiative by adopting DBFM approach as compared to traditional procurement approach. • Under ASAP I all 18 schedule were delivered 2 years earlier than they would have under a traditional approach and one month earlier than the contracted date under the public-private partnership agreement. Government is anticipating similar schedule efficiencies under ASAP II and ASAP III. • 18 ASAP I schools were delivered in 22 months; 10 DBFM and 4 DB ASAP II schools will be delivered by June 30, 2012. With the total 32 schools delivered over the period of 5 years and total capital investment around $700 million, this can be considered as a ground breaking initiative in North America. Key Benefits: The primary objective was to implement a fast, cost-effective solution for delivering new school infrastructure. Tied to this were supporting objectives: • Address specific educational programming and space requirements for each school board. • Create a flexible core/modular building design that would allow the stakeholder school boards to adapt their new schools to changing needs over time. • Build sustainable schools that meet LEED™ (Leadership in Energy and Environmental Design) silver standards. • Cost and schedule certainty for school delivery. • Ensure upkeep of schools so that the facilities have no deferred maintenance after 30 years. Community benefits: Schools are a foundation for the community, delivering substantial benefits particularly for growing communities. Several studies have shown that improved school facilities lead to higher academic performance and increased post-secondary participation – these benefits will apply to the approximately 24,750 students who entered the 32 new schools in September, 2010 and who will enter in 2012. Also, with many students no longer being bused or driven out of their community to attend school, the new ASAP I and ASAP II schools will reduce traffic and fuel consumption. For students, reduced travel will free time for leisure, study and family. The new schools will be a meeting place for the community, both in the daytime for parents, teachers and students, and in the evening for community groups. LEED™ standards ensure a reduced environmental footprint, and the 30-year operating period in the DBFM agreement ensures buildings remain functional with no deferred maintenance.

Who proposed the solution, who implemented it and who were the stakeholders?
Alberta Infrastructure led the initiative and proposed the solutions. Following are the key stakeholders with an overview of their key business requirements Alberta Infrastructure – Primary • Design and manage the process for the overall initiative. • Promote equity of school facilities for all students across Alberta. • Provide safe, effective learning environments for students. • Incorporate/respond to future program changes/delivery (wellness, technology etc). • Achieve cost effective and sustainable facility operations and maintenance. • Establish standards for the fair and equitable construction of new learning facilities that meet the needs of students, educators and other facility users. • Achieve environmentally sustainable facilities through the requirement for LEED Silver Certification. Alberta Education- Primary • Promote equity of school facilities for all students across Alberta. • Provide safe, effective learning environments for students. • Reduce overcrowding in schools. • Meet class size recommendations from the Alberta Commission on Learning. • Incorporate/respond to future program changes/delivery (wellness, technology etc). • Respond to changing student populations. • Improve high school completion rates. Alberta Treasury Board- Primary • Improve management of government operational and capital spending. • Develop opportunities to pursue alternative financing options, such as PPPs, and implement where cost effective and feasible. • Lead the development of PPP guidelines to provide consistent standards, policies and accountabilities across capital projects and ministries. School Boards -Primary • Provide safe, effective learning environments for students. • Reduce overcrowding in existing schools. • Reduce transportation costs within jurisdictions • Meet class size recommendations from the Alberta Commission on Learning. • Provide facilities that have the flexibility to adjust to evolving program needs (wellness, technology etc) and changing student populations. • Achieve sustainable operations and maintenance costs. • Provide input into school planning, design and construction. • Improve high school completion rates. School Users (parents, students and communities) – Secondary • Provide input in design development of schools during community consultation sessions. • Assist school boards in developing educational programs. • Coordinate community based initiatives with the school boards. Alberta and Canadian Design and Construction, Facility Management and Financing Industries – Secondary • Provide advice on design, constructability, financing opportunities and alternatives and process. • Communicate information to industry stakeholders and provide input to the government. • Participate in pursuit of the opportunity and if successful meet contractual obligations.

Describe how and when the initiative was implemented by answering these questions
a. What were the strategies used to implement the initiative? In no more than 500 words, provide a summary of the main objectives and strategies of the initiative, how they were established and by whom.
The ASAP initiative anticipated yielding a number of long term outcomes and objectives: • Providing schools in locations where students live; • Support for Alberta Education’s “Class Size Initiative”; • Cost certainty over the life cycle of the schools; • Reduction in delivery timeframe and dedicated public sector resources necessary for the provision of schools; • Effective 30-year ‘assets and maintenance warranty’ for school facilities; • Equity of school facilities within the province; • High quality, LEED™ certified sustainable buildings; and • Provision of an innovative, repeatable, transparent and accountable process for school facility project delivery. The Government of Alberta applied the following strategy to achieve its key objectives: • The consolidated approach to new school projects will be based on a Public-Private Partnership using a Design-Build Finance and Maintenance (DBFM) model. • Utilization of standard school designs with flexible student capacity. The flexible component of the student capacity would be delivered through the provision of high-performance modular classrooms that can be added to or subtracted from the core facilities as enrolments dictate over the life cycles of the schools. • Bundle the schools in one package, to make it big enough to be viable for Public-Private Partnership. Design, construction, financing, maintenance, and cyclical renewal of the facilities to be undertaken by a private consortium under contract to the provincial government over a 30 year period (plus the construction period), provided the DBFM delivery model is both feasible and provides value for money. In 2007 GoA initiated ASAP I, which was a pilot project focused on school locations in Edmonton and Calgary, where the number of schools required was large enough and in close enough proximity for a consolidated approach to be successful. School sites were determined in consultation with school boards in these cities. Using a Public-Private Partnership approach GoA awarded a Design-Build Finance and Maintenance contract to a private consortium. All 18 new schools were delivered by June 2010 under this pilot initiative. In 2009, based on the success of the pilot project ASAP II initiative was commenced to provide ten new schools in the suburbs of Edmonton and Calgary under one package using a DBFM approach. These schools are scheduled to be completed by June 2012. Another Four high schools are included in ASAP II under a Design Build approach. Each ASAP DBFM initiative was monitored by ‘Fairness Auditor’ to ensure transparency and integrity of the process. ASAP I was also audited by Auditor General of Alberta to check compliance with the processes, rules and regulations. Based on continuous success of earlier ASAP initiatives, GoA is contemplating to deliver more schools in the province under the ASAP program, building on the success and performance of the previous initiatives.

b. What were the key development and implementation steps and the chronology? No more than 500 words
Initially, the annual cross-government capital planning process is used to identify potential schools for PPP projects. Projects must be a priority as determined by the capital planning process. At the start of each of the ASAP initiatives, the project team conducted a market sounding. The main objective was to get feedback from the market and identify issues and market capacity in relation to the project. This feedback helped shaping the procurement process and the business structure for the projects. Stakeholders’ consultation is an imbedded part of this program, which is continuous throughout the procurement. Risk analysis forms an integral part of business case; When undertaking a PPP project it is critical to understand all factors or events that may jeopardize the government’s and proponents’ ability to achieve the anticipated benefits of the project, or that may increase the cost of the project. These factors or events are project risks. It is essential to assess the probability and impact of each category of risk, and to determine how each risk will be mitigated or managed. Once projects are selected, the PPP approach is evaluated, the principle for which is based upon Value for Money. Value for money must be determined through a net present value comparison of the comparable costs and risks of the proposed PPP project with the Traditional Procurement over the same life cycle, as demonstrated by a detailed Business Case. When the business case demonstrates that approved projects have PPP potential, the completed detailed business case and lifecycle cost assessment is submitted to an external advisory committee made up of private sector members. The Advisory Committee on Alternative Capital Financing reviews proposed PPP projects and provides recommendations to Treasury on the suitability of the project for PPP procurement. After Treasury Board approval, the procurement process includes the following stages: • Request for Qualifications (RFQ) which announces the start of the procurement process. The RFQ involves an open call for qualified teams to submit a response. The RFQ process generally results in the 3 most qualified respondent teams being short listed to participate in the Request for Proposals (RFP) stage of the procurement. • The RFP is limited to 3 proponents to allow each proponent team a reasonable chance of success in the procurement while ensuring there is sufficient competition to generate the best value for the GoA. • Commercial and Financial Close during which the project documents, including the Project Agreement, are executed and the Preferred Proponent meets all requirements to secure the private financing. After a successful procurement; the implementation phase commences and after construction completion and acceptance, the schools are handed over to the respective School Boards for educational program delivery.

c. What were the main obstacles encountered? How were they overcome? No more than 500 words
The Public-Public Partnership approached was untested in the social infrastructure sector in Alberta. The project team contacted several international jurisdictions, including the UK and Australia, to obtain feedback and lessons learned on their programs. The project team developed a program and business structure that was not only innovative and practical but suitable to the government, local design and construction market and other stakeholders. One of the key decisions was to develop a core team with diverse expertise. The team was established to coordinate technical, operational, financial, legal, procurement, risk management and other attributes for delivering the program. A cross ministry team was developed, working within one dedicated office, to coordinate and manage program planning and development in an effective and efficient manner. Recognizing that stakeholder input would be critical to the program’s success, the ASAP team set up Liaison Committees to involve stakeholders thoroughly in program development. All school boards and municipalities provided input through these committees. These Liaison Committee members provided information on the existing process for operating and maintenance under their individual boards. AI coordinated and documented the information. With this collaboration a common maintenance and operational plan of work requirements was developed so that the responsibilities and processes were consistent with all the new schools to be built under the contract. A program of such nature requires cross-ministry inputs and integration. There were two governance committees; referred to as the ‘Assistant Deputy Minister Technical Review Committee’ and ‘Deputy Minister Project Steering Committee’ which provided oversight and guidance on all aspects of the program. The ASAP program also introduced an innovative “core school” approach to designing new schools. By basing all schools on “core” designs, the ASAP model ensures all buildings conform to LEED and provincial standards and modified for programming requirements while also allowing flexibility of use. Adding modular classrooms to the “core” building enables the school boards to accommodate changing enrollment requirements. Building LEED standards into the core school and modular designs was another groundbreaking measure that will enhance the environmental performance of all new schools. To ensure its practical value for ongoing use, the ASAP team built the process template with extensive user consultation, resulting in a high level of stakeholder buy-in. With this support, the government was able to roll out the new strategy and start building immediately. And with the template now in place, the province will be able to initiate new projects more quickly and efficiently, without having to go back to basics. Both ASAP I and ASAP II initiatives faced extremely tight deadlines. In both cases the ASAP project team had an extremely tight schedule to capture all the technical requirements and documents, legal structure, legislative review, program requirements, business structure design and transaction documents and procurement. Based upon established schedules, the project team met all project milestones. In case of ASAP I all 18 schools were delivered one month earlier than the target date; similarly ASAP II is on schedule.

d. What resources were used for the initiative and what were its key benefits? In no more than 500 words, specify what were the financial, technical and human resources’ costs associated with this initiative. Describe how resources were mobilized
A cross-ministry core team with diverse expertise was established to coordinate technical, operational, financial, legal, procurement, risk management, communications and other requirements of the project. This core group also had access to technical and professional resources from the Department and other ministries. The team also retained outside consultants and advisors for financial, transaction, capital markets, cost modeling and design development services. All the consultants and advisors were retained through open and competitive process following formal Request for Proposal (RFP) processes. A program office was created where all the core team worked within one dedicated office space to coordinate and manage project planning and development in an effective and efficient manner. There were two committees; an Assistant Deputy Minister level committee, referred to as the ‘Technical Review Committee’ and Deputy Minister level committee ‘Project Steering Committee’ to provide oversight, guidance and decisions to the ASAP team on all aspects of the initiatives. Stakeholder input was critical to the program success, the ASAP team set up a School Board Liaison Committee to involve stakeholders thoroughly in process development. All school boards provided input through this committee. Team also coordinated with the respective municipalities and cities to coordinate zoning and permitting process and established one point of contact to streamline the permitting issues for the initiatives. A Fairness Auditor was used to help ensure the fairness of the procurement process. ASAP I and II initiatives under the program were approved by the Treasury Board under its Capital Plan and so were the associated budgets. Funds were allocated for planning, development and procurement of ASAP initiatives. The cost of 32 new schools under ASAP I and ASAP II initiatives is $984 million (NPV at the time of bid) including design, construction, partial financing and maintenance and renewal for thirty years.. For ASAP I initiative, the total planning and procurement cost, including the cost of consultancy and advisory services, was $ 2.2 million out of a $ 2.5 million budget. For ASAP II these costs were $2.0 million, which were within $8,000 of the budget.

Is the initiative sustainable and transferable?
Transferability: The Standard Core School Designs were mandated by GoA for all future schools to be built in Alberta, with a view to creating streamlined designs applicable for all schools and all school sites within Alberta. The decision to use a standard core school design for all future schools was based upon the real savings achieved by the GoA in utilizing a single design for various grade and capacity configurations province wide. The Standard Core School Designs include a permanent Core Structure which incorporates key functional areas such as the gymnasium, library, administration area, certain classrooms, gathering areas and project areas together with the provision of additional teaching areas through the use of high efficiency modular classrooms to easily and economically allow for changing enrolments. This provides equity across the province and eliminates designing on a per-school basis with standard designs used effectively and efficiently on multiple schools. Process Sustainability: Main feature of ASAP program was Public-Private Partnership approach which was based on a Design-Build-Finance-Maintain (DBFM) model. This model was first used on ASAP I as a pilot initiative. However, after successful implementation and validation of this approach, DBFM model usage was repeated for ASAP II initiative. ASAP II initiative also introduced an innovative Design-Build approach used for the delivery of four high schools. GoA is contemplating use of these approaches not only for future schools but also for other social infrastructure projects like water treatment facilities, hospitals, IT data centres, courthouses and senior’s housing. Environmental Sustainability: All new schools are designed and built to Leadership in Energy and Environmental Design (LEED) Silver standards by Canada Green Building Council (CaGBC) which ensures adoption of sustainable green building and development practices. New buildings are approximately 45 per cent more energy efficient than those built to National Energy Code for Buildings base-level. ASAP I initiative has created 12,000 student spaces and ASAP II will create another 12,750. Many of these students will no longer be bused or driven out of their community to attend school. This reduces traffic congestion and environmental impacts. Financial Sustainability: So far ASAP program has shown remarkable cost savings of $230 million in delivering 32 schools as compared to traditional project delivery methodologies. This provides the government with an economically viable and sustainable model to meet its infrastructure needs. Payments to the private partners are performance based and in case of non-compliance of the terms of agreement the payments are adjusted and deductions are made from their due payments. Regulatory and Institutional Sustainability: The initiatives under ASAP program complied with Alberta Building Codes and also complied with all the permitting requirements of respective municipalities and regulatory requirements of federal and provincial authorities. Social Sustainability: For students, reduced travel will free time for leisure, study and family. The new schools will be a meeting place for the community, both in the daytime for parents and students, and in the evening for community groups making these facilities socially sustainable.

What are the impact of your initiative and the lessons learned?
According to the 2006 Canada census, Alberta led the way in population growth between 2001 and 2006. The 10.6% increase was twice the national average of 5.4 This rapid increase in population has put increased pressure on social infrastructure and particularly the need for schools in the newer city subdivisions. ASAP program was initiated in 2007 to meet these demands; in the span of only three years it was able to deliver 18 schools and with the total of 32 schools by 2012. This is a remarkable achievement and one of its kind in North America. Schools are a foundation for the community, delivering substantial benefits particularly for growing communities. Studies have shown that improved school facilities lead to higher academic performance and increased post-secondary participation – these benefits will apply to the approximately 12,000 students who entered the 18 new schools in September 2010 under ASAP I and another 12,750 by September 2012 under ASAP II initiative. Similar results can be expected from future ASAP initiatives. Over five years, the ASAP process will deliver 32 new schools more quickly and at lower cost. The agreement minimizes the impact of escalating costs with a fixed price and construction schedule. Faster delivery is a major benefit in a rapidly growing province. Through the PPP process, the first 18 schools will be completed two years quicker than by traditional methods. As Alberta’s population grows and construction costs continue to escalate, the ability to deliver new projects quickly will help ensure project costs remain manageable. Another advantage is the maintenance strategy, whereby the vendor maintains the buildings for the first 30 years. This operates like a built-in warranty against defects, reducing government risk. The ASAP template will continue to deliver value for future projects. The government has adopted aspects of the maintenance portion of the model for use on all GoA building maintenance contracts. Requiring the LEED environmental standards was another groundbreaking measure that enhanced the environmental performance of all new schools built using the core and modular approach. To ensure its practical value for ongoing use, the ASAP project team built the processes to have high level of input from stakeholders that included GoA ministries, municipalities, school boards, industry and general public. With this support, the government was able to roll out this new ASAP strategy and start initiatives almost immediately. And with the template now in place, the government will be able to initiate new projects more quickly and efficiently. Other public sector organizations are already investigating ways to use this GoA “best practice” to their own benefit. Inquiries and follow-up discussions have come from the Government of Saskatchewan, Dade County, Florida, Australia and the United Kingdom. The success and contributions of this program have been recognized with several provincial, national and international awards.


Institution Name:		Alberta Infrastructure
Institution Type:		Government Department
Contact Person:		John Gibson
Title:		Director- ASAP Program
Telephone/ Fax:		780-644-8593
Institution's / Project's Website:		780-644-8402
E-mail:		john.gibson@gov.ab.ca
Address:		Infrastructure Building. 6950-113 Street
Postal Code:		T6H5V7
City:		Edmonton
State/Province:		Alberta
Country:		Canada

The Problem

Solution and Key Benefits

Actors and Stakeholders

(a) Strategies

(b) Implementation

(c) Overcoming Obstacles

(d) Use of Resources

Sustainability and Transferability

Lessons Learned

Contact Information