Ukraine Public Transport Framework: Project Due Diligence

Programme Description:

The European Bank for Reconstruction and Development (the “EBRD” or the “Bank”) has approved the Ukraine Public Transport Framework (the “Programme”) to support investments in public transport renewal in Ukrainian cities. The Programme will finance a number of smaller sub-projects. The ultimate goal of the Programme is to support development of reliable passenger transportation service.

It is expected that the Programme will finance the following investments:

• Acquisition of new trams, trolleybuses and buses;
• Rehabilitation and modernisation of tram and trolleybus electrical infrastructure;
• Renovation of depot and acquisition of new maintenance equipment; and
• Implementation of Automated Fare Collection (“AFC”) and vehicle location systems.

Having inherited a diverse set of public transport networks a generation ago, with a typical Ukrainian city having established networks for trams, trolleybuses and buses, today Ukrainian municipalities, with a few exceptions, struggle to even maintain the existing service level, let alone finance their modernisation or expansion. Severe lack of investment since the 1990s has resulted in partial closure of the networks with fleets today in a typical Ukrainian municipality operating less than half the number of trams and trolleybuses compared with the peak level in the late 1980s. Additionally, municipal public transport fleets are typically aged in absence of fleet renewal.

A typical public transport operator finds itself in financially and operationally challenging situation: while tariffs are set at low levels, public transport operators are obligated by social policy to transport several categories of concessionary passengers (pensioners, veterans, etc.). The existence of private minibus operators has led to the bifurcation of public transport between subsidised municipal “social” transport and non-subsidised private transport. Another major issue is the lack of coherent route planning and the non-competitive award of routes to private minibuses. This has resulted in an inefficient overlap between municipal and private fleet on the most heavily used corridors. A combination of rising car ownership, poor traffic management, including parking management, and inadequate public transport provision has led to traffic congestion, the decrease in the operational speed of public transport, associated economic losses and negative environmental effects as well as growing road safety concerns.

The EBRD needs a comprehensive analysis of the proposed investments under the Programme. The objective of this assignment is to provide the Bank with an assessment of the sub-projects under the Programme from a legal, technical, economic and financial perspective. The reports on each sub-project should also meet local requirements for feasibility studies.

Framework Agreements for the Programme

The Bank intends to enter into Framework Agreements with up to three consultants (the “Framework Consultant(s)”) to enable the Bank to call upon a shortlist of pre-qualified firms from which it can quickly and efficiently obtain reliable services. The Framework Agreement will establish, in advance, fee rates for experts, contract terms and agreements, and procedures that will govern individual assignments (Assignments or Call-offs) to be required to implement the Programme. Under these Framework Agreements, the Bank will have the option, but not the obligation, to place individual Assignments with the selected Framework Consultants.

Framework Consultants will be selected for individual Assignments in accordance with EBRD’s Procurement Policies and Rules (PP&R). The Bank may send to the Framework Consultant(s) specific Terms of Reference for the Assignment (Specific ToR). The Specific ToR will include a description of the tasks to be performed, time-schedules and reporting instructions. The Framework Consultant(s) should respond by sending to the Bank a technical and financial proposal for the Assignment together with details of the Expert(s) proposed to carry out the work. The Bank will then assess the response(s) and – subject to successful negotiations - issue a call-off notice (Call-Off Notice) for the individual Assignment to the selected Framework Consultant.

Description of individual Assignments (Call-offs)

Consultancy services for individual Assignments are expected to include the following:

1. Analysis of urban transport system and regulatory framework

1. Overview of regulatory framework and institutional set up;
2. Main parameters of services, including number of routes for different modes;
3. Number of passengers carried and their structure in terms of eligibility to social discounts;
4. Number of operators and description of their fleets in terms of type, size and age,
5. Annual turnover in the sector
6. Suburban service scale.

2. Analysis of the Municipal or Private Transport Operator

1. Scope of services provided;
2. Market position and share;
3. Organisational structure and number of staff;
4. Management;
5. Size and structure of the fleet;
6. Revenue structure;
7. Cost structure and trends.

3. Scope, technical specification and justification of the proposed investment

4. Inputs for Financial Model and Economic IRR

5. Business Plan with a Financial Model and Project Justification

6. Drafting scope of work for further technical cooperation

Status of Selection Process: Interested firms or groups of firms are hereby invited to submit expressions of interest.

Programme Start Date and Duration: The Programme is expected to start in Q3 2016. The selected Framework Consultants will be engaged via Framework Agreements with a validity period of up to three years, renewable for one further year only.

Cost Estimate for the Programme and Assignments: EUR 2,000,000 (exclusive of VAT). The cost estimate for individual Assignments will vary depending on their specific scope, but individual budgets are expected to be in the region of EUR 200,000 (exclusive of VAT).

The Consultant must determine whether any VAT would be chargeable on the services and the basis for that determination, without taking into consideration the special status of the Bank as an IFI and state this to the Bank in their response to the Invitation for Expressions of Interest. To the extent that a Consultant incurs input VAT on goods and services purchased in connection with the provision of services (e.g. VAT on airline ticket) which is not otherwise recoverable by the consultant from the local tax authority, the gross cost to the consultant of such expenses shall be treated as a reimbursable expense.

Funding Source: This Programme is expected to be funded by donor funds. Please note that selection and contracting will be subject to the availability of funding.

Eligibility: There are no eligibility restrictions.

Framework Consultant Profile: Corporate services are required. The Consultant will be a firm or a group of firms preferably with previous project experience related to:

1. Urban transport planning, operations and equipment;
2. Transport Economics;
3. Financial expertise;
4. Relevant engineer depending on the project (tram, trolleybus, bus or AFC);
5. Ukrainian transport law

The Consultant’s expert team is expected to include key experts as follows:

Key Expert No 1 (Team Leader) with preferably 15 years’ experience in urban transport planning operations;

Key Expert No 2 (Transport Economist) with preferably 10 years’ experience in transport economics;.

Key Expert No 3 (Financial expert) with preferably 10 years’ experience in finance and economics;

Key Expert No 4 (Engineer) with preferably 10 years’ experience in urban transport; and

Key Expert No 5 (Legal expert) with preferably 7 years’ experience in Ukrainian transport law.

Submission Requirements: In order to determine the capability and experience of Consultants seeking to be shortlisted for the Programme, the information submitted should include the following:

1. Company/group of firms’ profile, organisation and staffing (max. 2-4 pages).

2. Details of previous project experience or similar assignments particularly undertaken in the previous five years, including information on contract value, contracting entity/client, project location/country, duration (mm/yy to mm/yy), expert months provided (if different from duration) , main activities, objectives.

3. CVs of key experts who could carry out the Assignments detailing qualifications, experience in similar assignments, particularly assignments undertaken in the previous five years, including information on contracting entity/client, project location/country, duration (mm/yy to mm/yy), expert months provided, assignment budget, main activities, objectives.

4. Completed Consultant Declaration Form and Contact Sheet, the template for which is available from the following web-link:

http://www.ebrd.com/pages/workingwithus/procurement/notices/csu/contact_sheet.doc.

The above information should not exceed 15 pages excluding CVs and contact sheet.

Expressions of Interest should be submitted in English electronically through e-Selection, to reach the Bank not later than the closing date. The complete expression of interest (including cover letter, CV, declaration and contact sheet etc.) shall be one file (pdf) to be uploaded to eSelection. The EBRD reserves the right to reject applications of experts submitting more than one file. Only if the permissible file size (4 MB) is exceeded, the Consultant may split the expression of interest into further files.

Bank Contact Person:

Georgia Vasiliadis

Technical Co-operation

European Bank for Reconstruction and Development

One Exchange Square

London EC2A 2JN

Tel: + 44 20 7338 7750

e-mail: vasiliag@ebrd.com (submissions should be sent through eSelection and NOT to this email address)

Notes:

1. Following this invitation for expressions of interest, a shortlist of qualified firms will be formally invited to submit proposals. Consultant selection and contracting will be subject to availability of funding.

2. The shortlist criteria are:

(a) Firm’s experience in similar assignments in the urban transport sector (35%)

(b) Firm’s experience in similar assignments in the urban transport sector in Ukraine (30%)

(c) CVs of key experts (35%)