Toll Road Update
Recent developments in the toll road and infrastructure industries are summarized below. These developments are based on research we conducted in January and February. If you would like any additional information regarding this research or if we can be of any assistance to you, please let us know.
RFQ Released for Doyle Drive: The California Department of Transportation and the San Francisco County Transportation Authority issued a Request for Qualifications (RFQ) on February 2, 2010 for a PPP to (i) replace portions of the existing Doyle Drive on Route 101 which serves as the southern approach to the Golden Gate Bridge with a six-lane roadway and (ii) operate and maintain the entire Doyle Drive. The RFQ is available at http://www.publicinfrastructure.ca.gov/. Responses are due on March 1, 2010 and the shortlisted bidders are expected to be announced on March 31, 2010.
RFQ Released for LA Parking Garage PPP: The City of Los Angeles issued an RFQ on February 5, 2010 for a possible concession of publicly-owned parking garages. The concession, which would be between 20 and 50 years, would include at least 10 parking structures that contain 8,398 parking spaces. Two additional parking structures that are currently under development may also be included and would add 801 parking spaces to the total. The city anticipates shortlisting bidders in mid-March 2010, releasing the bid documents in May 2010 and closing the concession in July 2010. The RFQ is available at http://www.ci.la.ca.us/cao/index.htm.
RFQ for Gerald Desmond Bridge Could Come Soon: Infra-Americas reports that an RFQ for the replacement of the 4-lane Gerald Desmond Bridge with a 6-lane bridge could be released soon. The project is estimated at $1.1 billion and, along with Doyle Drive, has been identified by the state as being the most ready for procurement among the possible PPP projects the state is currently evaluating.
RFQ Released for Pittsburgh Parking PPP: The Public Parking Authority of Pittsburgh (PPAP) issued an RFQ on February 12, 2010 for a possible concession of over 17,000 parking spaces located in the city. Responses are due on March 19, 2010 and PPAP anticipates reaching financial close in November 2010. Pittsburgh is seeking $200-$300 million from the possible lease in order to fund the city's pension.
Pittsburgh’s Airport Evaluates Parking Privatization: Other parking assets in Pittsburgh, operated by the Pittsburgh International Airport, are also being considered for privatization. In December 2009, the Allegheny County Airport Authority hired Walker Parking Consultants to appraise the value of the airport’s parking garages and surface lots, which amount to 13,200 parking spaces. While no commitment on privatization has been made, the Airport Authority is seeking ways to reduce its long-term debt which is currently estimated at $479 million. The airport’s parking facilities generate $22 million in revenue annually for the Airport Authority.
Interest Sought for Detroit River International Crossing Bridge: On January 27, 2010, the Michigan Department of Transportation (MDOT) and Transport Canada (TC) issued a Request for Proposals of Interest (RFPI) for PPP opportunities in connection with the development and financing of the Detroit River International Crossing, a proposed multi-billion dollar bridge across the Detroit River to connect the city of Detroit with Windsor, Ontario. The RFPI can be found at http://www.partnershipborderstudy.com/. Responses are due by March 17, 2010.
The RFPI contains a schedule that includes “key milestones” for the project’s development. MDOT and TC will seek the necessary project approvals in Summer 2010 and, if obtained, will release an RFQ in Winter 2010/11. A Request for Proposals (RFP) would follow in Summer 2011 with bids due in Winter 2011/2012.
Indianapolis Seeks Partners for Parking PPPs: The City of Indianapolis released an RFQ on February 10, 2010 for a possible concession of approximately 3,500 parking meters and potential management agreements for approximately 20,000 parking spaces in city-owned parking garages and surface lots. On the same day, the city released an RFI for a potential lease of the parking facilities at the Indianapolis International Airport, which includes approximately 18,000 parking spaces. Responses to the RFQ are due on March 15, 2010 and responses to the RFI are due on March 26, 2010. The RFQ and RFI can be found at http://www.indy.gov/eGov/City/Controller/Purch/Bids/Pages/BiddingOpportunities.aspx.
Congressmen Promote Illiana Expressway: State congressmen introduced legislation in January 2010 that would authorize developing the Illiana Expressway as a public-private partnership. The proposed project is a 25-mile east-west toll road that would connect Interstate 65 in Indiana with Interstate 57 in Illinois. Indiana Governor Mitch Daniels has long supported developing the estimated $1 billion expressway as a PPP, however Illinois Governor Pat Quinn’s stance on a PPP is not known, although he generally has voiced support for the expressway.
RFI Released for Hartford Parking PPP: The City of Hartford and the Hartford Parking Authority (HPA) issued a Request for Information (RFI) on January 27, 2010 to gauge the private sector's interest in a possible concession of the city's parking assets. The possible concession would include on-street parking spaces, parking garages and surface lots for a total of 6,396 parking spaces. Parties interested in possibly bidding for the concession must respond to the RFI by March 22, 2010.
Puerto Rico Passes First Step to Privatize Luís Muñoz Airport: On December 22, 2009, the Federal Aviation Administration (FAA) accepted the Puerto Rico Ports Authority’s preliminary application for the Luís Muñoz Marín International Airport (LMM) to participate in the FAA’s airport privatization program. The Ports Authority may now seek a private partner to negotiate a concession agreement before submitting a final application to the FAA. LMM had over 4.6 million passenger boardings in 2008, and the airport’s reported net income for its fiscal year ending June 30, 2008 was over $37.8 million. David Alvarez, Executive Director of Puerto Rico’s Public-Private Partnerships Authority, has stated that a PPP for LMM tops the list of his agency’s “high priority” projects.
Puerto Rico Eyes PPPs for High Priority Roadways: Along with LMM, PPPs for three of Puerto Rico’s toll roads, PR-22, PR-66 and PR-52, were also classified as “high priority” projects by Puerto Rico’s Public-Private Partnerships Authority in December 2009. The Authority’s David Alvarez noted that the development of these three projects along with a few others, such as for power production and school renovations, are being targeted for “immediate” development.
PR-22, a 52-mile toll-road in northern Puerto Rico, is the most traveled highway on the island. Puerto Rico’s Highway and Transportation Authority (HTA) has discussed combining brownfield and greenfield components in a procurement for PR-22, which could include a proposed 27.8 mile extension to the city of Aguadilla, home of the growing Rafael Hernández Airport. HTA has also discussed brownfield and greenfield components for PR-66, the island’s only expressway to the eastern coast. The greenfield component would be a $223 million, 3.8 mile extension which would include a new toll plaza. PR-52 is Puerto Rico’s longest toll road, spanning 67 miles from San Juan (Puerto Rico’s largest city) to Ponce (Puerto’s second largest city). Mainly brownfield components, such as capital improvements and the further optimization of new technologies and congestion relief measures, have been discussed for PR-52.
New Deadline Set for Plan to Privatize Midway Airport: The City of Chicago was given a new deadline of April 30, 2010 to notify the FAA of its plans for Chicago Midway International Airport (MDW), which currently holds a spot in the FAA’s airport privatization program. The initial deadline was February 1, 2010, but the city requested, and was granted, an extension from the FAA. After the original deal to lease MDW stalled in 2009, Chicago Mayor Richard Daley indicated he will revive the privatization when financial conditions improve. The city has not decided whether it would re-start negotiations with the previous winning consortium, negotiate with the other consortia that had been pre-qualified or solicit new bids from potential concessionaires. In 2008, MDW was the 29th busiest airport in the United States, measured by number of passenger boardings.
Georgia Introduces PPP Program: The Georgia Department of Transportation (GDOT) held an industry workshop on December 3, 2009 to unveil its new PPP program and introduce a number of its proposed PPPs. The first project that may be pursued is the addition of approximately 26 miles of reversible managed lanes along Interstate 75 and Interstate 575. GDOT has estimated the project at over $1 billion. GDOT’s timetable for the project includes issuing an RFQ in February 2010, issuing a RFP in August 2010, selecting the preferred bidder in March 2011 and reaching financial close in June 2011. The project’s procurement may be bundled with a pre-development agreement to examine the feasibility and possibly develop the I-285W/I-20W project, which is proposed as an addition of approximately 16 miles of managed lanes along Interstate 285 West and Interstate 20 West.
Other projects that have been identified as “priority projects” include:
- SR 400: 21.8 miles of managed lanes to complement existing general purpose lanes along State Route 400 from Interstate 285 North to State Route 141/Peachtree Parkway. GDOT currently estimates issuing an RFQ for the approximately $1 billion project in the second half of 2010.
- Gwinnett Connector: a 13.36 mile, four-lane limited access toll road that would connect State Route 316 to Peachtree Industrial Boulevard. GDOT currently estimates issuing an RFQ for the approximately $444.6 million project in late 2011.
- I-285 Top End: 13.14 miles of additional managed lanes to complement existing general purpose lanes along Interstate 285 between Interstate 75 North and Interstate 85 North. GDOT currently estimates issuing an RFQ for the approximately $976 million project in early 2011.
- Atlanta North-South Tunnel: an estimated $3.7 billion project that would connect Interstate 675 with State Route 400 via a new roadway that would transition to a tunnel. The new facility would be tolled. GDOT has not yet announced a procurement timetable.
- Jimmy Deloach Connector: a new 3.1 mile, four-lane limited access roadway that will connect State Route 307 and the Jimmy Deloach Parkway. GDOT has not yet announced a procurement timetable for the estimated $113 million project, which is planned to ease an increase in future truck traffic due to the proposed expansion of the Port of Savannah.
- I-75 South: 29.5 miles of additional managed lanes to complement existing general purpose lanes along Interstate 75 from Interstate 285 to Locust Grove Road. GDOT has not yet announced a procurement timetable for the approximately $1.7 billion project.
Las Vegas Issues RFP for Parking PPP: The City of Las Vegas and the Las Vegas Redevelopment Agency issued a Request for Proposals on January 4, 2010 to examine the possibilities of establishing a PPP in connection with certain of the city’s parking assets. The city’s press release states that the city has invited firms “to identify and analyze opportunities that may exist for maximizing revenues, reducing expenses, operating more efficiently and retiring or restructuring debt, among other recommendations.” The city has also stated that it is open to receiving submissions that either evaluate potential PPPs or that propose actual partnerships. The Mercury News has reported that an option for the city includes contracting with a private company to manage the parking assets, which consist of over 6,500 spaces. The city made $2.8 million in 2009 from its parking assets.
Responses are due on March 12, 2010 and the RFP can be found at http://www.lasvegasnevada.gov/Business/5990.htm?ID.
Possible PPP Toll Road in Baton Rouge: Public meetings were held in January 2010 in connection with the planning for a proposed $4 billion toll road that would loop around Baton Rouge, the capital and second-largest city in Louisiana. It was reported in 2009 that a public body organized to pursue the project was expected to decide in 2010 on how the 80-mile loop would be financed, and a PPP for the loop was an option.
State Evaluates PPPs for Infrastructure: Delaware state congressmen held a hearing in January 2010 to discuss the viability of using PPPs to fund the state’s much-needed transportation projects. One congressmen noted the state did not have the tax dollars to fund the projects but that union pension plans would be an ideal candidate to finance PPPs given the current lack of confidence in the financial markets and the unions’ own desires to create employment for their members.
Florida Gets High-Speed Rail Funds: It was announced in January 2010 that Florida will receive $1.25 billion of the $8 billion in high-speed rail stimulus funds the Obama administration will allocate. Florida is planning a high-speed rail line between Tampa and Orlando, with the possibility of extending the line to Miami in the future. State transportation officials have expressed their desire to use PPPs to develop the high-speed rail lines. Infra-Americas previously reported that the Florida Department of Transportation and the Florida High Speed Rail Authority indicated an intent to issue an RFQ in April 2010 for PPP opportunities if the state’s request for high-speed rail stimulus funds was accepted. The U.S. High Speed Rail Association will be holding a conference in Orlando March 4-5, 2010. More information on the conference is available at http://www.ushsr.com/.
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