CP4 CAPRICE – PMB PILOT- PROJECT CONTRACT FOR PUBLIC TRANSPORT SERVICES TO BE CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND PTS OPERATOR

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Municipality of Bucharest Bucharest Transport Authority - regulation, planning, certification, procurement, monitoring, penalties Public Transport Department – insufficient staff Operating subsidies and subsidies for special passenger categories Lack of service performance indicators Poor control over performance of operation There is no integrated transport plan (with the metro) available RATB Autonomous Regie directly reporting to the Municipality No contract for public services available Global record keeping for all operations (there is no separate accounting of transport operations that are publicly- subsidised) Provides local and regional public transport services

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Legal mandatory conditions for concluding the contract for public services between RATB and PMB (Municipality of Bucharest) Conversion of RATB in commercial company Delegation of administration through direct award (upon procuring the first contract concluded post-restructuring with the commercial companies emerged as a result of restructuring the regias) Adoption of documents preceding the delegation of administration of contract for public transport services (local public transport programme, Bucharest public transport services regulations, book of specifications, standard form of contract, etc) The infrastructure remains part of the communitys public asset base Public transport services shall be carried out using only leased or owned vehicles (use of rented vehicles is prohibited) in accordance with legal mandatory traffic safety and environment requirements (at least Euro 3- compliant), regular technical inspection, etc. The Operator has exclusivity on the assigned routes.

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Service Planning (legal) Responsibility of the Municipality Public Transport Plan approved by Resolution of the Local Council, highlighting main and secondary lines RATB may request amendments Current Situation No Transport Plan has been approved yet Planning is carried out by RATB No studies are available to optimise the networks

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Tariff Plan (legal) Approval of fare setting, adjustment, fare change - PMB Basis for fare setting – eligible expenses elements Legal fare change or adjustment algorithm – in accordance with a rise in consumption price ratio as against the current level on the date of the previous adjustment Approval of passenger categories that are entitled to concession fares - PMB Basis for fare setting, proposal for adjusting or changing fares - RATB Current Situation Basis for fare setting based on expenditures that are not accurately recorded (there is no separate accounting of transport operations)

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Collection of incomes generated by ticket sale (legal) RATB or the Operator Current Situation RATB, in kiosks Adding value to magnetic cards – RATB only – payment to Metrorex- total trips made Concessioning of Infrastructure ( legal) The royalty may be paid by the Operator Operator carries out maintenance Current Situation RATB does not pay the royalty Operator carries out maintenance

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Term of Contract related to the average depreciation term of all transport assets owned by the Operator related with the necessary depreciation of investments term - Operators responsibility Printing, dissemination and validation of farecards (legal) Printing – PMB Dissemination – RATB or PMB Compulsoriness of fare integration by implementing a single type of farecard for all public transport modes Current Situation Printing and dissemination - RATB Farecard validation – ticketing sistem using 2 types of validators (paper and magnetic tickets) – can not record the number, type of trips by line, period etc.

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Investment Subsidies In infrastructure – PMB, administration and implementation – either PMB or RATB In rolling stock - RATB Passenger Information PMB and RATB Not correlated with the other transport modes that are not operated by RATB Record keeping of revenues and expenditures (legal) RATB, separate recording of subsidised public transport operations Current Situation Global accounting records, costs are not identified by transport mode, line, etc. Public transport–related activities

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Monitoring of RATB Operations ARR and AFER, inspections checking for safety, compliance with both environment and legal regulations PMB has an official delegate in the RATB Board of Directors Reports prepared by RATB Subsidies Related to operation, transport or fare obligation Operating subsidies - Concession fare subsidies: for special passenger categories – using local budget – (for example: pensioners are entitled to free transport upon producing proof of pension slip Penalties may apply (currently there are no penalties)

Quality and Performance Indicators In order to monitor performance of the first 5 indicators and to ensure contract performance supervision, there is a need to implement a GPS system on all transport modes. Without a GPS system in place, performance of the above-mentioned indicators can only be measured by RATB using surveys. The value of accepted levels for each indicator shall be negotiated until Contract signing. They are due to be set based on last year indicators recorded by RATB. CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB

Objectives that must be taken into consideration upon preparing the Contract Draft Implementation of contract performance monitoring instruments Development of Public Transport Department or procurement of contract management by a specialised company Full implementation of traffic management system Restructuring of ticketing system to enable quantification and monitoring at all times of trips by type, mode of transport, line, date etc. Separate recording of expenditures and revenues to determine an accurate level of subsidy Implementation of additional indicators, penalties and bonuses The Contract shall foster RATB growth in order to enable the latter to participate in tenders after Contract termination

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Proposal Regarding Time-Phasing of Pilot Project- terms December 15, PMB – submission of materials – standard forms of contracts, documentations December 1, partners – submission of materials – standard forms of contracts, documentations May 1, PMB - translation and proposal of a RATB-PMB Contract in order to discuss it with the work group, dissemination to partners May (2 days) first work group meeting, proposals of amending the Contract, constraints in implementation of models ( Bucharest) September 1, PMB – review of Contract as a result of the first meeting conclusions, dissemination to partners September 2010 (3 days) - second work group meeting, completion of contract applicable to RATB, identification of risks in contract monitoring, setting of parametres due to be monitored using the supervision software programme (partner) November 1, IT equipment, laptop included, implementation of supervision software that monitors indicators December 2010 (2 days) - last work group meeting – system testing, evaluation of pilot project results (Bucharest)

CONTRACT FOR PUBLIC TRANSPORT SERVICES CONCLUDED BETWEEN MUNICIPALITY OF BUCHAREST AND RATB Structure of work team for the pilot project Bucharest Ion Dedu – PMB Melania Mih ă escu – PMB Filip Atanasiu- PMB Marian Gabriel Bors-PMB Marian Bratu – RATB Geanina Suditu – Metroul SA (consultant) Dan Gheorghiade - Metroul SA (consultant) Constantin Ballo – Metroul SA (consultant)