Abdel Aziz, A M (2007) A survey of the payment mechanisms for transportation DBFO projects in British columbia. Construction Management and Economics, 25(5), pp. 529-543. ISSN 1466433X
Abstract
In traditional project delivery systems, payment mechanisms provide compensation for the work performed using construction capital payments. In the alternative public-private partnership (PPP) systems, payment mechanisms follow the selected PPP system. For example, the build-operate-transfer system provides compensation based on project demand using real-tolls usage payments; the design-build-finance-operate (DBFO) system provides shadow-tolls usage payments; and the performance-based DBFO system provides compensation based on contractor's performance using service availability payments. Designing the payment structure is an important task where several factors have to be considered. This paper analyses the implementation of payment mechanisms in a number of DBFO transportation projects in BC, Canada, in terms of payment structure, payment types and characteristics, determination and funding. The analysis provides insights for the design of payment mechanisms. The analysis shows that more payment types are being used and that the mechanisms are designed to achieve specific government objectives. The analysis refers to a new 'hybrid' payment mechanism with elements derived from the traditional and the PPP systems. The hybrid system may have potential to minimize the overall project cost; however, agencies have to be flexible in the delivery concepts as combinations of payments for inputs, usage and services might have to be used.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | contracting; dbfo; infrastructure; payment mechanism; project delivery |
| Index terms: | agency, design-build-finance-operate, performance-based, transportation project, project cost, survey, toll, hybrid system, payment type, implementation, compensation, project delivery, payment mechanism, funding, build-operate-transfer, partnership, Canada |
| Subjects: | economic analysis, project delivery, contractual arrangements, dispute resolution, data collection methods, systems and processes, transportation engineering, infrastructure and transport systems, sociology, partnership management, Geography, economics, performance measurement |
| Topics: | Procurement, Stakeholder Management, Geographical Context, Research Practice, Engineering Principles, Business Strategy, Cost Management, Quality Management, Legal Issues |
| Descriptive scope: | 4 PCTE |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here