2. TNIDB Processes and Relevant Procurement Legislations ...

TAMIL NADU INFRASTRUCTURE DEVELOPMENT BOARD

TNIDB Processes and Relevant Procurement TNIDB Processes and Relevant Procurement

Legislations in TN

29th April, 2014

DisclaimerDisclaimerThe Tamil Nadu Infrastructure Development Board (TNIDB) and its consultants have prepared thisdocument to be used as training material for Government Agencies and their Officials, who mayhave to interface with TNIDB for different reasons. It provides an overview of TNIDB’s processesand relevant procurement legislations in Tamil Nadu. However, this document should not berelied upon for its accuracy or exhaustiveness, as it is of a general reference nature only and isnot intended to address the specific circumstances of any particular project, GovernmentAgencies and their Officials. TNIDB and its consultants shall not assume any liability on theinformation provided herein in this document as it may not necessarily be comprehensive,complete, accurate or up to date. The information contained herein should not be construed asprofessional or legal advice. TNIDB and its consultants assume no responsibility or liability in thecase where a loss/damage is caused any person or entity that has relied on the informationcontained herein.

2

Contents

1 Relevant Acts, Rules and Regulations in Tamil Nadu

2 Applicability of the TNID Act, 2012

3 Sectors Covered

4 Relevant Processes

5 Implementation and Monitoring

3

Relevant Acts, Rules and Regulations in

Tamil NaduTamil Nadu

Tamil Nadu

Infrastructure

Development Act,

2012

Tamil Nadu

Infrastructure

Development Rules,

Relevant Acts, Rules and Regulations (1/2)

�Provides the institutional framework for identification,

prioritization and implementation of infrastructure projects

�Provides an enabling and facilitating environment for

financing, design, construction, maintenance and operation of

such projects

�Lays down the procedures for determination of State support

and management of funds created under the TNID Act

�Specifies the classes of project where TNIDB may be the Development Rules,

2012

Tamil Nadu

Infrastructure

Development Board

Regulations, 2013

�Specifies the classes of project where TNIDB may be the

procuring entity

�Lays down the procedure for publishing of project details

�Lays down the manner in which the Board shall operate

�Provides for the form and manner of preparation and

approval of project documents

�Provides the framework for Value for Money Assessment

�Provides the factors in determining the mode of

implementation

�Provides the framework for implementation and monitoring

of projects

© Tamil Nadu Infrastructure Development Board5

Tamil Nadu

Transparency in

Tenders Act, 1998

Tamil Nadu

Transparency in

Tenders Rules, 2000

Relevant Acts, Rules and Regulations (2/2)

� Provides transparency in public procurement

� Regulates the procedure in inviting and accepting

tenders

� Provides the procedures for all types of procurement

except for procurement under PPP mode

� Provides for framework for tendering process, evaluation Tenders Rules, 2000

The Tamil Nadu

Transparency in

Tenders (Public

Private Partnership

Procurement) Rules,

2012

� Provides for framework for tendering process, evaluation

and award (except for procurement under PPP mode)

� Applies to all procurement for PPP projects of a value

more than Rs. 25 lakh

� Provides for procedures to be adopted in procurement

planning

� Provides the details of tender documents

� Provides the procedures in selection of concessionaire

� Provides the scope of work for Independent Engineer

and Independent Auditor


Applicability of the TNID Act, 2012Applicability of the TNID Act, 2012

Inclusions Exclusions

All projects of a value

exceeding Rs. 500 crore

Any project undertaken by

the Central Government or

a public sector undertaking

TNID Act: Inclusions and Exclusions

All Public Private Partnership

projects of a value in excess of

Rs. 10 crore

a public sector undertaking

of the Central

Government, either

independently or as a joint

venture with the State

Government

[TNID Act, 2012 Section 1(3)]


© Tamil Nadu Infrastructure Development Board


8

Sectors CoveredSectors Covered

Agriculture

Infrastructure

including Marketing

and Post Harvest

Development of

Minor Minerals

Drinking and

Industrial Water

Supply Systems,

Sectors Covered (1/4)

and Post Harvest

Infrastructure

Minor Minerals Supply Systems,

Desalination Plants

Education related

Infrastructure Fisheries Gas and Gas Works


10

Health Infrastructure

Housing including

Slum Development

and Development of

Industrial Estates

including Industrial

Parks and Special


and Development of

Satellite Towns

Parks and Special

Economic Zones

Information and

Communication

Technology

Inland Waterways

other than National

Waterways

Irrigation including

Dams, Irrigation,

Structures, Canals


Land Reclamation

Projects

Ports (other than

major ports) and

Harbour thereof

Power Generation,

Transmission and

Distribution Systems


Harbour thereof Distribution Systems

Roads, bridges

Including Rail over and

under Bridges and By-

passes

Solid Waste

Management

Sports & Recreation

Infrastructure


Tourism and

Urban transportation

System, Bus Terminals, Waste Water,

Sewerage Treatment


Tourism and

Hospitality

System, Bus Terminals,

Multi Level Parking

Facilities

Sewerage Treatment

Systems


Relevant ProcessesRelevant Processes

Project Conception and Planning (1/2)

Step 1 Project Scoping – Need Assessment

Stage I

Step 2Option Analysis – Evaluation of Various Asset

Lean Options

Use a non-asset

solution

Improve existing

asset

Create new

asset


Step 3 Undertaking Pre-feasibility Study (Optional)

Technical Financial

Project Conception and Planning (2/2)Stage I

Step 4Preparation & Submission of a Project

Concept Note

Project Concept Note Form –

Refer to Appendix I of TNIDB

Regulations, 2013, Pg. 74


(Regulation 7 of TNIDB Regulations, 2013)

Step 1Approval of Project

Concept Note (PCN)

NY

The approving

authority of the

Project Concept

Note is the

Project Development (1/3)Stage II

(If the Department has submitted

only PCN)

Directive to

undertake

Feasibility Study�Projects outside

the ambit of

TNIDB

Note is the

Chief Executive

Officer, TNIDB

�Information

provided in PCN

is inadequate


(Section 14(4) of TNID Act)

(Regulation 7(3) of TNIDB

Regulations, 2013)

(Regulation 7(3) & (4) of TNIDB

Regulations, 2013)

Step 2 Application to PPF

The Project Preparation Fund (PPF) could also be

availed for:

Approval

for PPF

Authority

Up to Rs. 5

lakh

CEO

Rs. 5 lakh

– Rs. 50

Sub-

Committee � Any technical study required to finalize the technical,

Project Development: Support from Board to

Engage Consultants and Application to PPF (2/3)Stage II

– Rs. 50

lakh

Committee

of the EC

Rs. 50 lakh

– Rs.5

crore

Executive

Committee

Above Rs.

5 crore

Board

� Any technical study required to finalize the technical,

legal or financial parameters of a project including

legal reviews and commercial assessment studies;

� Preparation of Impact Assessment Studies including

Environmental Impact Assessment Studies;

� Preparation of tender documents including standard

tender documents;

� Preparation of other essential project documentation

prior to signing concession agreement;

� Training and

� Conduct of outreach events including seminars and

conferences


Source: Delegation of Powers to Executive

Committee/Sub-committee/Chief Executive

Officer

Step 3 Selection of Consultants [OPTIONAL]

The Empanelled

Consultants have

been pre-qualified

Technical /

Engineering Experts

Project Development: Support from Board to

Engage Consultants and Application to PPF (3/3)Stage II

Empanelled been pre-qualified

by TNIDB. Hence,

the procuring

agency needs to

select a

consultant based

only on the lowest

financial quote.

Feasibility and Market

Study Experts,

Financial Advisors

Transaction Advisors

Legal Advisors

Empanelled

Consultants

http://tnidb.tn.gov.in/ListofEmpanelledof_Consultants.php © Tamil Nadu Infrastructure Development Board19

Part A

Feasibility

Assessment

Value for Money

(VfM) assessment is

mandatory and an

integral part of the

feasibility study and

the evaluation to

Part B

Structuring

Project Development – Preparation of Feasibility

Study [Mandatory]Stage III

the evaluation to

determine whether

to execute the

project through the

conventional

procurement

options or through

the PPP framework.

Decision to go / no go

Mode of Implementation

Project Structuring

Extent of Financial Support and Modalities

thereof

Appropriate Concession Mechanism



Value for Money Assessment – Determination of

most appropriate delivery modeStage III

Stages for undertaking VfM Assessment

1. Computation of Public Sector

Comparator

2. Estimation of the cost of delivering

project through PPP mode

� Specify clear outputs

� Account for competitive neutrality

� Costing of transferable risks and

retained risks

� Risk adjusted lifecycle cost of

public sector mode and PPP mode

Steps


1 2 3

Appraisal and approval

stage

Evaluation of the tenders

stage before final award

After the awarding of the

tender to the successful

tenderer

Stages for undertaking VfM Assessment

Continuous UpdationIndicative in nature and should

include qualitative factors also


21

Step 1Submission of

Application to TNIDF

(Submission to be made along

with the financial model)

Approval

for

Approving

Authority

Release of

TNIDF

Board:

Full

Powers

EC: Up to

Rs. 10

crore

Application to TNIDF (1/2)Stage IV

Subsidy or capital grant during construction phase

Operational grants during the operation period or crore

Advance

Release of

TNIDF

CEO,

TNIDB

Operational grants during the operation period or

part thereof

Annuity payments for a specified period in the life of

the project

Equity investment in the entity implementing the

project including a special purpose vehicle (SPV)

Loans to entity implementing the project including a

SPV

Any other form Government may notify from time to

time

Use

s o

f T

NID

F


22



Officer

(Rule 10, TNID Rules 2012)

Application to TNIDF (2/2)Stage IV

Limits on TNIDF

�The total financial support from TNIDF including annuity payments, shall not

exceed 20 per cent of the total project cost,

�Provided for projects where the Board is the procuring entity the financial

support from TNIDF excluding annuities shall not exceed 40 per cent of the

total project cost

Limits on State Support

(Rule 10(3) of TNID Rules, 2012)

Limits on State Support

�State support for a project in the form of subsidy, capital grant, and equity

participation during the period of construction of the project shall not in

the aggregate exceed 20 per cent of the total project cost – excluding

annuities

�Total public financial support for a project in the form of subsidy, capital

grant, equity participation, net present value of operational grants, loans

and the net present value of quantifiable tax incentives shall not exceed 40

per cent of the total project cost – excluding annuities

© Tamil Nadu Infrastructure Development Board23(Rule 11 of TNID Rules, 2012)

Step 1Approval of Feasibility

Study and PCN

Step 2Determination of Mode

Approval

for

Approving

Authority

Approval

of

Feasibility

Study and

Board: Full

powers

EC :

Exceeding

Recommendations of the Board on Feasibility Study,

Project Concept Note and Mode of ImplementationStage V

[Section 14(4), TNID Act 2012]

Step 2Determination of Mode

of ImplementationStudy and

Project

Concept

Note

Exceeding

Rs. 50 crore

and up to Rs.

500 crore

SC : up to Rs.

50 crore

Step 3Recommendation to the

Government




Officer



A B Implementation under

Public Sector Mode

Implementation under

PPP Mode

� Determination of adequacy of

information (regarding the

technical, economic, social or

financial parameters of the project)

� Determination of adequacy of

information (regarding the

technical, economic, social or

financial parameters of the project)

Mode of Implementation (1/3)Stage VI

� Direction to the public agency to

commence implementation of the

project

� Direction to public project details

� Direction to the public agency to

commence implementation of the

project

� Direction to publish project details

� Direction to issue notice inviting

suggestions and objections


[Section 15, TNID Act 2012]

[Section 16, TNID Act 2012]


Forms of PPPs allowed under TNIDB

Investment or Financing

related

Operation and Maintenance

related

Build-Operate and Transfer (BOT) Management Agreement

[Schedule II, TNID Act, 2012]

Build-Own-Operate (BOO)

Build-Own-Operate-Transfer (BOOT)

Build-Transfer-and-Operate (BTO)

Design-Build-Finance-Operate-

Transfer (DBFOT)

Lease Management Agreement

Build-Lease-and-Transfer (BLT)

Rehabilitate-Operate-and-Transfer

(ROT)

Rehabilitate-Own-and-Operate

(ROO)


Approval for Approving Authority

Designate the Public Agency for implementing

all the Projects implemented through Public

Sector mode

EC: Full powers

However, in case of difference

of opinion in ‘EC’, the Board

may decide.


Approval of Mode of Implementation through

PPP Mode

CEO: Full powers

Decision to Publish or not publish the details

of projects on the website.

EC: Full powers


(Source: Delegation of Powers to Executive Committee/Sub-committee/Chief Executive Officer)

Step 2Finalization of Scope and

Structure

Step 3 Finalization of Financial

Step 1Submission of Report on

Objections and Suggestions

to Board within 30 days

Project Structuring and Final Approval for Public

Private Partnership ProjectsStage VII

(Regulation 13, TNIDB Regulations 2013)


Step 3 Finalization of Financial

Support

Approval for Approving Authority

Project Scope and Structure EC: For Projects exceeding Rs. 1000 crore

SC: For Projects exceeding Rs. 100 crore

up to Rs. 1000 crore

CEO: For Projects up to Rs. 100 crore

Financial Support from TNIDF EC: For Project value up to Rs. 100 crore

Board: Full Powers

State TNIDF Centre

© Tamil Nadu Infrastructure Development Board 28


Process Flow Chart (1/2)

Project Identification(10 days)

PCN and Application to

PPF (20 days)

Feasibility Study(110 days)

TNIDB/EC to decide

Public/PPP and PFS

1

2

3

4

Detailed Project Study (175 days)

Public/PPP and PFS(140 days)

Public Mode

PPP Mode

Notice on Public Interest

& Report on Objections and

Suggestions (200 days)

TNIDB/EC to Finalise Scope, Structure and

Public Financial Support(230 days)

4

5

5

6

29

Approval from Government

(170 Days)

7

Process Flow Chart (2/2)

Preparation and Submission of

Tender Documents (230 days)

8

Approval of Tender Documents,

TNIDB/EC Approval (260 days)

9

Request of Expression

of Interest (REOI)

Can be

done 3

Request for Qualification (RFQ)(320 days)

Bid Finalisation and Signing of

Concession Agreement(425 days)

10

11

12

30

Request for Technical

Proposal (RFTP)

(320 days)Request for proposal (RFP)

(380 days)

of Interest (REOI)

(320 days)

done

sequential

to

3

Optional

Stage I: Project Conception and Planning

Stage II: Project Development

Stage III: Project Development – Preparation of

Feasibility Study

Stage IV: Application to TNIDF

10

0

20

110

Summing Up

140Stage IV: Application to TNIDF

Stage V: Recommendations of the Board on Feasibility

Study, Project Concept Note and Mode of

Implementation

Stage VI: Mode of Implementation

Stage VII: Project Structuring and Final Approval for

Public Private Partnership Projects

170 for Public

Sector Mode

200 for PPP

Mode

Cumulative Duration

(In Days)

230


140

Implementation and MonitoringImplementation and Monitoring

32

Appointment of Project Managers/ Project

Management FacilityStep 1

Project Management

Facility

Large and Complex

Projects

Implementation and Monitoring (1/3)

Facility Projects

Project Managers Less Complex Projects

Duration of PMF/PM: Completion of project and the

project asset is transferred to public agency or Government

or until such time as determined by the Government


Preparation of Project

Management PlanStep 2 The Project

Management

Plan should be

prepared at a

stage no later

� The Contract or Concession Agreement and

its schedules;

� All financing agreements as well as financial

models, where applicable;


stage no later

than the signing

of the Contract or

the Concession

Agreement

models, where applicable;

� The names, roles and contact details of key

individuals of both parties;

� Implementation plan during development,

construction, operations and exit phases;

� Performance management plan;

� Risk management plan;

� Financial and contract administration plan;

� Relationship management and Contingency

plan; and

� Contract Termination and Handover plan


Project MonitoringStep 3


�Submission of Achievement and

Exception Report on a quarterly

basis within 30 days of the end

of each quarter

�Periodic reports during

construction phase

� Periodic status reports during

operational phase – Key

Exit Strategy for

Continued Service

Delivery after ExitStep 4

operational phase – Key

Performance Indicators and

other indicators

�Review of options to ensure

service continuity

� Testing and valuation of assets

� Resource allocation for

implementing exit strategy

� Obligation of the parties in

relation to the exit strategy


Q&AQ&A

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