Infra Insight Blog

On April 7, 2010, the California Transportation Commission (CTC) authorized the first two regional design-build projects under the state's innovative contracting authority under Senate Bill 4, SBX2 4. 

• The ExpressLane Project is a joint state/local project of the Los Angeles County Metropolitan Transportation Authority (LA Metro) and the Department of Transportation (Caltrans), which will be implemented by Caltrans.  The project will convert existing carpool lanes on Interstates 10 and 110 to high-occupancy toll (HOT) lanes, or ExpressLanes.
  

   

• The Riverside County ...

State and local strategies to bridge the gap between traditional funding and current needs – which has been referred to as alternative finance – are now becoming mainstream. 

Consider Los Angeles Mayor Antonio Villaraigosa’s plan to speed up the development of LA’s transit infrastructure, which the LA Times reports would include financing from ‘a combination of private financing and bonds, such as Build America Bonds, established in the economic recovery bill to cut interest costs for local and state infrastructure projects.’ 

In fact, this model has already been ...

A week after the Project Finance Awards honored the Florida deals, the Infrastructure Journal Awards honored the Texas DOT’s North Tarrant Express project as its 2009 Global Transport Deal of the Year. The Florida DOT’s I-595 Project was nominated along with one other project for the honor.

The North Tarrant Express was nominated with two other projects for the IJ’s 2009 Global Deal of the Year – which selects from projects in all sectors, including: power, renewables, oil and gas, PPPs, and transport.

Nossaman was nominated along with two other law firms for the 2009 ...

The White House’s Council on Environmental Quality has issued two draft guidance memos regarding important NEPA compliance issues that may add another regulatory layer to infrastructure project development.

The draft guidelines on greenhouse gas (GHG) emissions, issued on February 18, 2010, require that environmental impact evaluations by federal agencies address GHG.  Among other things, federal agencies are required to quantify and describe expected direct and indirect GHG emissions, to discuss measures to reduce GHG emissions, and to qualitatively discuss the link ...

The Port of Miami Tunnel Improvement Project was named the 2009 Global Deal of the Year and the 2009 North American PPP Deal of the Year by Project Finance Magazine

The I-595 Corridor Roadway Improvements Project was named the 2009 North American Transport Deal of the Year

Project Finance Magazine, a leading global infrastructure industry trade publication, announced the honors at its awards ceremony in New York on March 4th and profiles both the Port of Miami Tunnel and I-595 projects in its current issue. Nossaman is honored to have had the opportunity to work on both of ...

USDOT Announces $1.5 Billion in TIGER Grants – $60M in TIFIA Allocations

On February 17, the one year anniversary of the landmark American Recovery and Reinvestment Act, USDOT announced the final list of TIGER grant recipients. Grants range in size from $3.15M for a roadway rehabilitation/reconstruction in Burlington, VT to a $105M grant for construction of two new intermodal facilities in Memphis, TN and Birmingham, AL to support freight rail service from the Gulf Coast to the Mid-Atlantic.

When combined with state and private funds, the TIGER funds will support ...

On February 11, 2010, the Georgia Department of Transportation (GDOT) posted a Notice of Intent to Issue a Request for Qualifications for the West by Northwest Project.  The notice of intent marks the initiation of GDOT's first P3 project under its new P3 program.  The notice of intent, is available on online at http://ssl.doas.state.ga.us/PRSapp/PublicBidNotice?bid_op=1048400NOI-484-050310P3.  GDOT intends to award a concession to design, construct, finance, operate and maintain a 29-mile segment  of managed lanes along I-75  and I-575, as well as enter into a ...

Yesterday the California Department of Transportation, in cooperation with the San Francisco County Transportation Authority, issued a Request for Qualifications for a public-private partnership for the Presidio Parkway project (also known as the Doyle Drive replacement project) in San Francisco.  The RFQ is available at: http://www.bidsync.com/DPX?ac=view&auc=610389

This is the first procurement initiated under the new public-private partnership law in California, SB4, codified at Section 143 of the Streets and Highways Code.

Under Section 143, the project must be ...

It was the best of times, it was the worst of times…  Dickens could have been describing 2009, as the P3 market continued to look strong, notwithstanding the economic downturn. Last year three significant P3 deals reached financial close in the United States: in March the I-595 in Florida, in October the Port of Miami Tunnel also in Florida, and mid-December the North Tarrant Express in Texas. All were remarkable in their own right, and cumulatively earned Nossaman the top spot in Infrastructure Journal’s league tables in the North American Transport P3 legal advisor category.

We take a look back at what made the deals remarkable and what 2010 might bring…

For the 89^th year, January brings new ideas in transportation. The 89^th Transportation Research Board Annual Meeting will be held in Washington D.C., January 10-14. 

Reflecting the theme of Investing in Our Transportation Future – BOLD Ideas to Meet BIG Challenges, Nossaman Partner Geoffrey Yarema will give a presentation titled "P3 Successes and Lessons Learned" on January 10. Nossaman Partner Nancy Smith will give a presentation titled "Public-Private Partnership Update" on January 11. 

We look forward to discussing and learning with others.

Ahead of schedule, NTE Mobility Partners has announced that the Texas Department of Transportation’s North Tarrant Express Managed Lanes project has reached financial close. Under the PPP deal, NTE Mobility - a Cintra-led consortium - will build, finance, maintain and operate a 13-mile corridor in the congested Dallas-Fort Worth area. The $2.02 billion project includes funding from $400 million worth of private activity bonds (PABs), $650 million in TIFIA credits, $573 million in investment from TxDOT, and $427 million in equity from NTE Mobility. The project reached ...

The Utah Department of Transportation has announced its selection of the Provo River Constructors team to deliver the Utah County I-15 Corridor Expansion (I-15 CORE). Provo River Constructors is comprised of Flour Enterprises, Inc., Ames Construction, Inc., Ralph L. Wadsworth Construction Company, Inc. and Wadsworth Brothers Construction Company, Inc. The group will expand the I-15 freeway by two lanes in both directions from Lehi Main Street to Spanish Fork Main, extend the express lane from University Parkway in Orem to Spanish Fork, rebuild and reconfigure 10 freeway ...

USDOT has published new program guidance for the TIFIA Program which clarifies project selection criteria and processes. The new guidance is the product of long deliberation at USDOT, which withdrew an earlier proposal last spring. [See USDOT Withdraws Proposed Changes to the TIFIA Program.]

The notice:

• Announces a change in TIFIA selection criteria and processes going forward – rather than the current first come, first served basis for project submission, the new process would pool all letters of interest and apply weighting criteria to choose the best projects.

• Requests ...

The closing of the Port of Miami Tunnel Project deal was just short of miraculous, given the tight financial markets and the political ups and downs of the project procurement. Novel risk allocations helped ensure the success of the deal. The current issue of Public Works Finance includes an excerpted discussion of the risks and the way the Florida Department of Transportation chose to address them. The full text of Port of Miami Tunnel: Digging Through Novel Risks is available on Infra Insight.

The Obama Administration recently outlined its proposal for enhanced federal safety oversight of subways, light-rail and municipal bus systems. USDOT Secretary Ray LaHood said, Now, would we prefer that states regulate their own systems? You bet. But some states simply lack the resources to do that. And, in a pinch, some state will cut safety items from their budgets. For transit passengers those cuts are too dear.

The proposed Public Transportation Safety Program Act of 2009 would authorize the Secretary, through the Federal Transit Administration (FTA), to set and enforce minimum federal transit safety standards and ensure that transit safety efforts grow in tandem with increased ridership.

USDOT is currently prohibited from establishing federal transit safety standards, and instead relies on 27 State Safety Oversight Agencies (SSAs) to monitor transit safety as provided in 49 CFR Part 659.   Following several transit incidents earlier this year, FTA Administrator Peter Rogoff announced the Administration’s intent to enhance federal oversight.  [See FTA Considering New Safety Oversight for Rail Transit.]  Funding, independence, and enforcement powers are critical concerns for SSAs, which average less than one staff person per transit agency and in some cases rely on transit revenues from the systems they oversee.

Under the proposed program, FTA would be authorized to promulgate minimum national standards for rail transit safety, applicable to all fixed rail systems not currently under Federal Railroad Administration jurisdiction. (The legislation would also authorize bus safety regulatory authority but DOT expects its initial focus to be on rail transit safety.)

States could choose to continue transit safety oversight on behalf of FTA, but only when FTA finds that the SSA has:

•          an adequate number of fully-trained staff to enforce federal regulations;
•          been granted sufficient authority by its governor and state legislature to compel compliance by the transit systems it oversees; and
•          sufficient financial independence from any transit systems under its purview.

A recent court case upholds the concepts of innovative design and quality performance utilized by alternative delivery methods that have become necessary due to shrinking public agency budgets and the need to accelerate critical projects. The case concerned the U.S. Army Corps of Engineers’ (Corps) use of an Indefinite Delivery/Indefinite Quantity (IDIQ) Contract through a two phased proposal process for a $301 million construction project to build a series of military facilities to be performed under a series of future task orders.

An IDIQ Contract allows the procuring ...

A client recently asked our firm about delivery methodologies commonly used for mega-projects.  A recent ENR article highlights this trend towards use of alternative delivery methods, including design-build, contractor at risk and PPPs.

According to the article, the US Army Corps of Engineers is using design-build and construction management at risk (which the Army Corps calls Early Contractor Involvement (ECI)) on many projects to speed up delivery of the Hurricane and Storm Damage Risk Reduction System, including the Gulf Intracoastal Waterway West Closure Complex ...

On October 8, 2009, FHWA issued electronic toll collection rules in response to a 2005 SAFTEA-LU law, which in all respects reiterate the status quo for the tolling industry and provide no guidance or standards with respect to SAFTEA-LU’s goal of progressing towards a nationwide interoperable electronic toll collection system.

With regard to interoperability, Section 950.7 of the rules require the tolling agency to identify: (i) the projected users of the facility; (ii) the predominant electronic toll collection systems likely utilized by users of the facility; and (iii) the ...

Senators Boxer and Inhofe are preparing to hotline a six-month extension of the federal surface transportation programs, which would provide funding at gross FY2009 levels, with an additional $8.7 billion in contract authority to replace the funds rescinded on September 30.

The bill would also extend funding for projects of national and regional significance (SAFETEA-LU 1301) and national corridor infrastructure (SAFETEA-LU 1302) according to 2009 receipts. House Transportation and Infrastructure chairman Jim Oberstar’s 3-month extension, which recently passed in ...

The Denver Regional Transportation District (RTD) has released a Lessons Learned Report which gives a realistic and sober review of what’s gone well and what should be done differently to implement the FasTracks program. The FasTracks is the RTD’s voter-approved, multi-billion dollar program to build 122 miles of rail transit, including six new commuter rail and light rail lines and extensions of three existing lines, build 18 miles of bus rapid transit service, add 21,000 new parking spaces, redevelop Denver Union Station and redirect bus service to better connect the ...

California will soon have a new authority that can authorize California transportation agencies to toll transportation facilities, eliminating the need for legislative approval for each tolling project. 

AB 798, a bill sponsored by state treasurer Bill Lockyer and recently signed by Governor Schwarzenegger, creates a new state level agency, the California Transportation Finance Authority, with the limited purpose of issuing revenue bonds for new capacity or improvements to the state transportation system at the request of a public sector project sponsor. Project sponsors ...

California is now ready to assess P3 candidate projects. At its October 14^th meeting, the California Transportation Commission approved policy guidance addressing the Commission’s role in selecting proposed P3 projects. The CTC developed the guidelines to assist Caltrans and regional transportation agencies (RTAs) as they move to develop P3 transportation projects, taking advantage of the new authority granted to them under Senate Bill X2 4, enacted in February of this year.

The enabling legislation requires the CTC to select projects nominated by Caltrans or an RTA ...

The Florida Department of Transportation (FDOT), announced at a press conference in Miami today that it has reached financial close on the Port of Miami Tunnel Project. 

FDOT, in partnership with Miami-Dade County and the City of Miami, entered into an agreement with MAT Concessionaire, LLC (MAT) which includes Meridiam Infrastructure Finance, S.a.r.l. and Bouygues Travaux Publics as equity members. The $900 million public-private partnership (PPP) deal uses an availability payment structure that provides for payment to MAT over 30 years after completion of construction ...

With the delay of the federal transportation re-authorization and federal transportation funding in limbo, state transportation agencies across the nation are trying to cope any way they can. In California this week, 19 self help local transportation financing agencies - that collectively generate more than $4 billion a year for transportation - drew a large crowd of transportation public agency officials, elected officials, contractors and consultants to the 20^th Annual Focus on the Future Conference in Los Angeles to explore their options. Conference speakers discussed current developments in transportation funding, environmental compliance and project delivery. The news on project delivery and innovation was positive, the environmental compliance news mixed, and the funding news pretty discouraging.

Interspersed with the grim chronicling of the current state and federal funding landscapes, the conference highlighted some bright spots, including federal ARRA funds, Measure R funding in Los Angeles, and innovative project delivery, PPPs and congestion pricing.

In the last week, much has been written about the submission of more than $50 billion in Track 2 high-speed and intercity passenger rail (HSIPR) funding applications to the Federal Railroad Administration (FRA).  But the resolution of FY 2010 transportation appropriations may be just as important in determining the direction of HSIPR and freight rail projects.

The OneRail Coalition, a coalition of passenger and freight rail stakeholders promoting investment in rail infrastructure, has written to House and Senate appropriators urging the highest possible support for HSIPR in the ...

Texas Department of Transportation (TxDOT) officials executed a comprehensive development agreement (CDA) Tuesday October 6 with NorthGate Constructors, J.V., led by Kiewit Texas Construction L.P. (Fort Worth), and Zachry Construction Corporation (San Antonio).  NorthGate Constructors, J.V. will develop, design and construct 8.4 miles of the SH 114/121 corridor known as the DFW Connector. Construction on the $1.02 billion design/build project is expected to begin by 2010 and the project is scheduled to open to traffic in 2014.
 

Included in New Jersey’s Economic Stimulus Act of 2009  are provisions to allow the use of PPPs to design, build, finance, operate and maintain higher education facilities.  Is this the start of a trend for developing social infrastructure in the US?

Social infrastructure includes housing, educational, recreational and law and order facilities that support the community's need for social interaction.  As reflected by several projects in Canada, this is not a new concept for North America.  Along with the recent use of a PPP for development of the Long Beach Courthouse, New Jersey’s ...

Two potential public-private partnership transit projects appear closer to leaving the station, after several delays. Denver Regional Transportation District (RTD) recently held a public hearing on the Eagle P3 project and is poised to issue a request for proposals to three prequalified/shortlisted teams on September 30th with proposals anticipated in March 2010. Bay Area Rapid Transit (BART) is on an accelerated schedule for its stimulus-revamped Oakland Airport Connector project, with proposals due in late September and contract award slated for December.

The Federal ...

USDOT is weighing 1400 TIGER grant applications (11 of which requested TIFIA funding) totaling $57 billion in funding requests. The TIGER (Grants for Transportation Investment Generating Economic Recovery) program provides for $1.5 billion in discretionary grants to high impact transportation projects, and could fund up to $200 million in TIFIA assistance.

Applications were due on September 15. Secretary LaHood has assembled a team to expedite application review, and plans to announce grants in January 2010 – a month ahead of the statutory deadline.

The program gives ...

The Florida Department of Transportation’s I-595 project and its public and private partners won several awards at this year’s American Road & Transportation Builders Association (ARTBA) P3 conference. It’s pretty much a Florida sweep, declared Pamela Bailey-Campbell, ARTBA Public Private Ventures Division president, as she announced the recipients of the Project, Public Sector Entrepreneur, and Private Sector Entrepreneur of 2009.

Bailey-Campbell announced three awards at the September 25 award luncheon in Washington D.C. The I-595 project in Fort Lauderdale ...

The House has passed a new bill (H.R. 3617) which extends federal highway and transit programs set to lapse at the end of September, when SAFETEA-LU expires, through the end of the calendar year.

Yesterday, House Transportation and Infrastructure Chairman Jim Oberstar introduced the bill under an expedited process which waives committee approval and prevents amendment.  The bill does not address the $8.7 billion rescission required under SAFETEA-LU, which will force FHWA to cancel program funding apportioned under SAFETEA-LU (as amended by the EISA) on September 30.

The ...

TRB’s National Cooperative Highway Research Program (NCHRP) division has weighed in on road user fees based on vehicle miles traveled or VMT. Their latest report Implementable Strategies for Shifting to Direct Usage-Based Charges for Transportation Funding responds to VMT’s critics who say the transportation funding method would be too challenging and require a lengthy implementation period. The report outlines strategies for shifting to direct user-based charges for transportation funding, focusing on incremental VMT mechanisms which can be fully implemented in the ...

The Government Accountability Office (GAO) has endorsed USDOT’s policy of allocating Highway Trust Fund (HTF) apportionments based on total lane miles in each state – including miles of highway built, operated or maintained through public private partnerships (PPPs).

Each state’s share of the nation’s highway system (quantified as lane miles) has factored in federal aid allocations since 1976, though initially this measure excluded tolled facilities. In 1998, Congress greatly expanded the use of the lane mile funding formula with TEA-21, and eliminated the ...

Texas Department of Transportation (TxDOT) officials executed a comprehensive development agreement (CDA) with the LBJ Infrastructure Group to design, construct, finance, operate and maintain the 13-mile LBJ-635 corridor in Dallas County. Following the North Tarrant Express (June 2009), the LBJ-635 is TxDOT’s second toll concession to reach commercial close this year.

Construction is expected to begin by mid-2011 and open to traffic in late 2016. Motorists will have a choice of either using the managed toll lanes or remaining on the improved and rebuilt free main ...

In addition to the recent passage of comprehensive P3 legislation in Arizona and California, the newly created Massachusetts Department of Transportation (MassDOT) has also been authorized to utilize public private partnerships for transportation projects. Provisions for design-build-operate-maintain (DBOM) and design-build-finance-operate-maintain (DBFOM) procurements are included in Senate Bill 2087, commonly known as the "Transportation Reform Act," under which MassDOT was formed. Under the Act, P3’s may be used for a new or existing highway, road ...

The Mississippi Transportation Commission has suspended the procurement for the Airport Parkway P3 project, citing the ongoing credit crisis and resulting pressures on revenue projections and senior debt credit ratings.

The Airport Parkway project, the first public-private partnership and first toll road project advanced in Mississippi, includes the development of a new 12-mile toll road and several bridges in the Jackson metropolitan area.  In August 2008, Mississippi DOT shortlisted three teams vying for the 50-year concession: ACS/Dragados, Cintra/Ferrovial, and ...

It isn’t often that infrastructure makes the Arts pages of the Los Angeles Times.  So the recent publication of glamorous renderings of transit projects that transcend typical configurations of concrete and steel may herald a new golden age for rail and transit.

HOK's award-winning design for Orange County Transportation Authority’s Anaheim Regional Transportation Intermodal Center radically transforms the traditional concept of art in transit into transit as art; the designers employ a train station and transit hub as the medium to create an iconic visual ...

Arizona has passed comprehensive P3 legislation on the heels of the passage of similar legislation in California.  Last month, Governor Jan Brewer signed House Bill 2396 which both updates Arizona’s existing toll road development and operations laws and gives the Arizona Department of Transportation (ADOT) broad authority to develop and operate a range of transportation projects through a variety of delivery methods.

Under House Bill 2396  ADOT is authorized to use virtually  any innovative delivery method, including P3s.  Facilities eligible in the bill include: new or ...

Arlington County is seeking to delay (or possibly derail) a project designed to ease congestion and add new lanes to Northern Virginia’s clogged 95/395 corridor.  Arlington has challenged the Categorical Exclusion (CE) granted by the Federal Highway Administration (FHWA), which allowed the project to move forward without a full environmental analysis.

Arlington is concerned that the new lanes will increase congestion throughout the corridor, and lengthen travel times, especially for transit.  Buses, carpools (HOV-3), motorcycles and emergency vehicles will have free ...

New subway safety standards may be coming soon to a city near you.  The Federal Transit Administration (FTA) has assembled a team of transportation safety experts to explore rail transit (subway, light rail, and commuter rail) safety reforms, which may extend to bus operations.

FTA is currently prohibited by law from establishing national safety standards, requiring Federal inspections, or requiring specific operating practices, but that may soon change.  In testimony before the Senate Banking Committee, FTA Administrator Peter Rogoff condemned several recent ...

California is serious about using its new legislative authority to deliver some of the state’s much-needed transportation projects through public-private partnerships (P3s). On August 12, 2009, the California Transportation Commission issued draft guidelines addressing the Commission’s role in approving the P3 delivery method for specific projects.

The draft guidelines follow the California legislature’s momentous enactment of Senate Bill 4, referred to as SBX2 4.  That bill authorizes Caltrans and regional transportation agencies to enter into P3s for ...

A recent survey conducted by KPMG International confirms what many in the infrastructure industry already knew: current infrastructure investment is insufficient to support economic growth and politics frequently influences infrastructure development in the United States.  In this global survey, KPMG surveyed 455 infrastructure executives, including 118 from the United States.

While much of the recent industry press has focused on the lack of available financing as the primary challenge to delivering infrastructure, a vast majority of the respondents indicated that ...

At the June 2009 meeting of the Texas Transportation Commission, TxDOT Assistant Director Phil Russell provided a first look at a proposed Rail Division for TxDOT, focusing on both passenger and freight rail planning for the future.  If created, the new  Rail Division would have a Rail Division Director, with  four departments under that to-be-named person's purview including Operations, Railroad Crossings, Safety and Project Development.

Commissioners indicated that it would be a wise move to create a Rail Division.  Commissioner Bill Meadows voiced that "the Commission needs ...

Dallas Area Rapid Transit (DART) and the Fort Worth Transportation Authority (The T) are in the early phases of procuring a firm to enter into a Public Private Partnership to design, construct, operate, maintain and finance a cross regional passenger rail service known as the Cotton Belt Rail Line starting on or about 2013.

The Cotton Belt Rail Line PPP project is intended to provide regional rail connectivity for communities along the project corridor to Fort Worth, Dallas-Fort Worth (DFW) Airport, the DART transit network, and major activity centers along the corridor.  This ...