- Posts by Fredric W. KesslerPartner
In over 41 years with the Firm, Fred Kessler has gained national recognition as a guiding force for public agencies in the field of transportation public-private partnerships (P3s). Clients benefit from his vast experience with ...
In his Infra Insight Blog post on April 9, Frank Liu reported on the uncertain status of the long awaited federal infrastructure bill. As the federal deficit balloons and election season intensifies, the likelihood of prompt Congressional action on a major infrastructure bill is diminishing. All indications are that it will be sidelined as Congress works on a “Phase 4” coronavirus relief bill to ameliorate the unprecedented loss of jobs throughout the nation and provide further direct assistance to the business community. The Phase 4 bill also should include ample stop gap ...
The job responsibilities will include:
- Managing and facilitating evaluation of unsolicited proposals submitted to the OEI
- Managing OEI’s P3 advisors
- Managing pre-procurement activities for P3 projects such as project screenings, qualitative and quantitative assessment and value for money analyses ...
Public agencies with toll-setting authority should take note of a recent federal court decision relating to the uses of user fees and toll revenue, as well as the stated goals of the plaintiff in that case.
The U.S. District Court for the Southern District of New York recently clarified the constitutional uses of toll revenue in American Trucking Associations v. New York State Thruway Authority, 13 Civ. 8123 (CM) (S.D.N.Y. Aug. 10, 2016). In this case, commercial trucking companies and the American Trucking Associations (ATA) claimed that the New York State Thruway Authority ...
Public entities have recently been looking for new ways to harness right of way (ROW) for broadband public-private partnership (P3) projects. Last year, the city of Santa Cruz made history by entering into a roughly $50 million P3 with local Internet service provider Cruzio to deliver 1-gigabit broadband access to every property in the city’s jurisdiction. Construction began this month. San Francisco is now considering pursuit of a similar P3. On the other side of the country, the Pennsylvania Turnpike Commission (PTC) recently released requests for proposals for legal and ...
A crucial highway improvement for the growing Phoenix region reached an important milestone November 2 when the Arizona Department of Transportation received proposals from all three short-listed teams vying to develop the Loop 202 South Mountain Freeway Project. The three multidiscipline teams are identified in our March 2015 blog.
This $1.9 billion megaproject includes the design, construction and 30-year maintenance of the last section of the Loop 202 Freeway – a route which will stretch 22 miles from the Maricopa Freeway segment of I-10 to the Papago Freeway segment of I-10 ...
Los Angeles County Metropolitan Transportation Authority (LA Metro) is pursuing new public-private partnership (P3) legislation, Assembly bill ABX 1-12 (Bill 12). Bill 12, introduced and read for the first time on August 26, 2015 at the California extraordinary session on transportation, would give LA Metro greater flexibility and autonomy to procure and finance transportation infrastructure in the LA Metro region.
LA Metro currently has authority under Section 143 of the Streets & Highway Code (Section 143) to deliver transportation projects using a P3 model with the use of ...
The Arizona Department of Transportation (ADOT) announced today it has shortlisted three developer teams vying for the $1.9 billion design-build-maintain contract for the Loop 202 South Mountain Freeway Project. The three multidiscipline teams, in alphabetical order, are:
- Connect 202 Partners
- Fluor Enterprises Inc.
- Granite Construction Co.
- Ames Construction Inc.
- Parsons Brinckerhoff Inc.
- DBi Services LLC
- AZTEC Engineering Group, Inc.
- Stanley Consultants
- Kleinfelder Group, Inc.
- AMEC Environmental & Infrasstructure, Inc.
- The Transtec Group
- Gunn Communications, Inc.
In the modern U.S. history of public-private partnerships, the prevailing project delivery models have been the toll concession and the availability payment contract. In both cases, the private party raises equity and debt financing and takes responsibility and risk for completing design, constructing and providing long-term operations and maintenance. The major difference between the two is that in the toll concession the private party takes the revenue risk and secures its debt with project toll revenues, while the public owner takes the project revenue risk under an ...
The Arizona Department of Transportation received on December 10 statements of qualifications from five teams vying for a design-build-maintain contract for the $1.9 billion Loop 202 South Mountain Freeway Project. The submitting teams are:
1. Connect 202 Partners
- Fluor Entreprises Inc.
- Granite Construction Co.
- Ames Construction Inc.
- Parsons Brinckerhoff Inc.
- DBi Services LLC
2. South Mountain Mobility Group
- Dragados USA, Inc.
- Flatiron Constructors, Inc.
- Pulice Construction Inc.
- AECOM Infrastructure Inc.
- AECOM Technical Services
- ACS Infrastructure Development, Inc.
The Arizona Department of Transportation announced today its decision to deliver the $1.9 billion South Mountain Freeway Project under a single design-build-maintain public-private partnership. While there will be a long-term maintenance component, ADOT, in collaboration with the Maricopa Association of Governments and the Arizona Division of the Federal Highway Administration, has decided to use available public funds together with public financing to pay for the project.
ADOT received an unsolicited proposal for the project more than a year ago. Under its P3 ...
In our prior posts we noted the important changes in federal tolling law under MAP-21 and some of the issues raised by those changes. MAP-21 modestly loosened the federal reins on tolling the nation’s Interstates and federal-aid highways. The Obama Administration just released its federal surface transportation reauthorization legislation, the Grow America Act. In section 1405, the Administration proposes further constructive steps to expand tolling rights, but reintroduces some constraints that MAP-21 relaxed.
Probably the most important proposal is to create the right ...
Yesterday the Arizona Department of Transportation issued to the P3 and design-build industry a Request for Information for the South Mountain Freeway project. ADOT is seeking perspective and feedback from lead developers, design-build contractors, maintenance contractors, and equity investors on a list of questions, and is providing an opportunity for industry input on the overall procurement process for the project.
Responses are requested by February 25. ADOT will convene and open industry forum on the project at the ADOT auditorium on February 27, and the industry has ...
We are now a short distance away from expiration of MAP-21, with no solution in sight for sources of funding to sustain the federal highway program. There is no stomach in Congress to increase federal gas taxes or to make real progress toward replacing gas taxes with mileage-based user fees.
As for tolls, Rep. Bill Shuster, Chair of the House Transportation and Infrastructure Committee, said in a speech last week that they might be even more difficult to do than some of the user fees." Tolling of interstates that have been free for decades would not be kindly received by voters, according to ...
On September 10, 2013, the California Department of Transportation (Caltrans) in cooperation with the Los Angeles County Metropolitan Transportation Authority (Metro), announced the shortlist for the Accelerated Regional Transportation Improvements (ARTI) Project.
The Project, located in Los Angeles County, includes the development of one high-occupancy toll lane in each direction along Interstate 5 (I-5) North from the SR 14 freeway to Parker Road; the design, reconstruction, rehabilitation and maintenance of the pavement of all lanes of the same segment of I-5 North; ...
The California Department of Transportation (Caltrans), in cooperation with the Los Angeles County Metropolitan Transportation Authority (Metro), issued on May 31, 2013 a Request for Qualifications (RFQ) for teams interested in submitting Statement of Qualifications (SOQs) to design, build, finance, operate and maintain the Accelerated Regional Transportation Improvements Project (the "ARTI" Project) through a public-private partnership (P3) agreement with Caltrans.
The ARTI Project consists of six elements, all of which are located in Los Angeles County, including ...
On May 1, the Los Angeles County Metropolitan Transportation Authority (Metro) will hold an industry forum to present initial concepts for several multimodal P3 projects that are being considered for the Sepulveda Pass Corridor in Los Angeles County. The forum will be held from 9:00 a.m. to 12:00 p.m. in the Ticket Room at Los Angeles Union Station. Los Angeles Mayor Antonio Villaraigosa, Los Angeles County Supervisor Don Knabe, and Art Leahy, Metro's CEO, are expected to address the forum attendees.
The projects under consideration include a high-capacity rail system and a tolled ...
As part of its effort to meet MAP-21’s legislative requirement to develop standard public-private partnership transaction model contracts for the most popular types of public-private partnerships, the Federal Highway Administration held a listening session with representatives from the transportation industry at the U.S. Department of Transportation in Washington D.C. on January 16. Representatives from state departments of transportation, general contractors, trade associations, legal advisors and others were in attendance, and solicited to provide FHWA with the ...
The Texas Department of Transportation (TxDOT) has reached a tentative, $1.6 billion deal with a private developer to expand Interstate 35W in north Fort Worth. According to a report released by TxDOT in late August, the stretch of I-35W in northern Tarrant County that is the subject of the agreement is the most congested roadway in the state - causing motorists to collectively waste more than 2 million hours. The deal between TxDOT and the developer, an affiliate of the entity that is currently developing the $2.5 billion North Tarrant Express project in northeast Tarrant County, will ...
The Federal Highway Administration (FHWA) recently issued guidance for implementing various aspects of the Moving Ahead for Progress in the 21st Century Act (MAP-21), including: Infrastructure; Environment, Planning and Realty; Safety; Operations; and Innovative Program Delivery. The guidance became effective October 1, 2012.
The interim guidance on Innovative Program Delivery includes provisions for implementing the new public-private partnership (P3) assessment requirement for Major Project Finance Plans under MAP-21. The new P3 assessment requirement is, in our ...
On September 24 the Federal Highway Administration issued policy guidance on various aspects of MAP-21, including a memorandum to its Division Administrators on the tolling provisions in MAP-21 and questions and answers on federal tolling laws.
The tolling guidance addresses (1) the complete replacement of the prior statutory language of 23 U.S.C. 129(a), (2) the application of the existing HOV/HOT lane provisions in 23 U.SC 166, and (3) the status of the four existing toll pilot programs. It is a must-read for anyone concerned with federal tolling law and policy.
Sections 129 and ...
Last night the Knik Arm Bridge and Toll Authority, responsible for development of the $750 million Knik Arm Crossing project in the Anchorage, Alaska region, filed a letter of interest with the USDOT for TIFIA credit assistance. It is one of the first, if not the first, letters of interest filed under the USDOT’s July 27 Notice of Funding Availability implementing the MAP-21 amendments to TIFIA.
KABATA filed a letter of interest in November 2011 for a $308 million TIFIA loan. With the changes in MAP-21 authorizing TIFIA credit assistance up to 49% of eligible project costs and ...
The Moving Ahead for Progress in the 21st Century Act (MAP-21) contains meaningful reforms that collectively represent a significant improvement in federal surface transportation law. For the most part, federal law directly on the subject of public-private partnerships saw little change of significance. Other federal laws, though not directly addressing PPPs, also affect the viability as a project financing mechanism. Changes to the TIFIA program and to federal tolling law that will markedly improve project finance via public-private partnerships were addressed in our ...
Congress recently passed MAP-21 and under prior law, with few exceptions, tolling was prohibited on Interstate highways and many other federal-aid highways. The bill expands the exceptions, in recognition of the fact that federal fuel tax revenues are stagnant and new revenue sources are imperative to meet the growing funding gap in surface transportation.
On June 29, 2012 Congress passed the Moving Ahead for Progress in the 21st Century Act (MAP-21), a compromise measure to reauthorize transportation funding through the end of 2014. A bipartisan and bicameral measure, MAP-21 contains meaningful reforms that, although marred by some missed opportunities, collectively represent a significant improvement in federal surface transportation law.
We foresee continued heavy demand for TIFIA credit assistance, particularly given the more attractive features of the reenacted TIFIA program. We have some concern that the combination ...
The Arizona Legislature sent to Gov. Jan Brewer on April 4, 2012 the landmark bill HB 2491, creating state-of-the-art toll collection and enforcement authority for the Arizona Department of Transportation (ADOT).
The bill follows on the heels of the state’s enactment of its public-private partnership (P3) law two years ago. While that law authorizes tolling, it lacked the enforcement mechanisms needed for effective open road electronic tolling, essential to modern toll road financing and operations.
HB 2491 includes a three-notice system, increasing charges for ...
On Nov. 3, 2011 the TIFIA Joint Program Office announced availability of limited funding for TIFIA credit assistance for fiscal year 2012 and invited submission of letters of interest (LOIs) by Dec. 30, 2011. While we are aware of no official announcement, sources inform us that the TIFIA JPO received LOIs from 26 project sponsors seeking over $13 billion in credit assistance to finance almost $36 billion in new infrastructure investment.
Moving Ahead for Progress in the 21st Century (MAP-21), the draft reauthorization bill unanimously voted out of the Senate Environment and Public Works Committee, contains major improvements to the TIFIA program that many, including those of us at Nossaman, have been advocating. These changes, if enacted, will greatly expand availability and eliminate much of the uncertainty over whether a project will be selected.
- The bill eliminates virtually ALL of the selection criteria, converting availability from a discretionary competitive selection process to a simple objective ...
Yesterday, the Knik Arm Bridge and Toll Authority (KABATA) announced its decision to shortlist three of six teams that submitted statements of qualifications for the Knik Arm Crossing project. KABATA is procuring an availability payment public-private partnership for the $750 million project. Nossaman acts as KABATA's legal advisor for the procurement.
Michael Foster, KABATA's Board Chairman, said, "The process becomes very competitive from here on out. We expect to see some top notch proposals."
The shortlisted teams are:
Alaska Infrastructure Access Partners
Yesterday the clock struck 4 p.m. in Anchorage, Alaska, the deadline for the P3 industry to submit statements of qualifications for the Knik Arm Crossing project. The public sponsor, Knik Arm Bridge and Toll Authority (KABATA), found on its desk statements from six experienced teams. This level of interest in a U.S. P3 project has few parallels.
Here are the six teams:
Knik Bridge Partners
Bechtel Enterprises Holdings
CSEC Holding Company, Inc.
China State Construction International Holdings, Ltd
Bechtel Infrastructure Corporation
CCA Civil, Inc.
Finley Civil ...
We are pleased to report that AB 294--the bill that was the subject of our blog yesterday--is no longer in play.
A last-minute amendment to California Assembly Bill 294, if passed, would wreak havoc on Caltrans and local agency plans to use design-build for state highway projects (Public Contract Code section 6800 et seq.) and to enter into public-private partnerships (P3s) for highway projects (Streets and Highways Code section 143).
The language added to the bill would preclude local agencies from hiring consultants to work on the projects, stating that all work must be done through Caltrans employees or consultants under contract with Caltrans. Project consultants are often hired well ...
The Pennsylvania Transportation Funding Advisory Commission just issued its final report on a strategy to improve the commonwealth's transportation funding. Aside from a list of recommendations for streamlining operations, the Commission made the following key recommendations for solving the commonwealth's transportation revenue and funding problems:
- Expand program management and outsourcing, including bundling "individual projects into programs—such as rehabilitating 100 to 300 bridges at one time—and engag[ing] experienced private sector program managers ...
If you want to know what a mature, effective federal and state P3 policy can look like, we need not look very far beyond our U.S. borders. Two Canadian provinces, Ontario and British Columbia, provide us a road map for building successful, sustainable P3 programs and policies.
At the International Bridge Conference in Pittsburgh last month, panelists for a workshop on P3s, including Len Kozachuk with Infrastructure Ontario (IO), described the essential features of this agency and its alternative financing and procurement program. The contrast with how our federal and state policy ...
The federal fiscal 2011 budget compromise authorized a third round of stimulus spending on transportation capital projects, dubbed TIGER III, under the Transportation Investment Generating Economic Recovery program. $527 million will become available from the U.S. Department of Transportation for selected projects.
Of this amount, up to $150 million will be slated for direct loans and other credit assistance on terms similar to the TIFIA program. This more than doubles up on the $122 million TIFIA budget authority for the 2011 fiscal year.
What we are interested in seeing is ...
The just ended InfraAmericas P3 conference in New York City brought together virtually every active participant, public and private, in the U.S. transportation P3 industry. A number of public agencies showcased their plans and projects, and there was a palpable sense that opportunities to bring U.S. projects forward are growing significantly.
Perhaps the project producing the most buzz at the conference is the Knik Arm Bridge and Toll Authority’s Knik Arm Crossing project in Alaska. KABATA came to the conference loaded for bear (a not infrequent pastime in this bountiful ...
The fiscally conservative House majority continues to pursue reductions in federal spending, and federal transportation spending is part of the mix. Further use of the general fund to supplement the Highway Trust Fund motor fuel taxes, as well as increases in fuel taxes, are opposed by the House majority. Cuts could come in several forms, including cuts in Title 23 programs overall or cuts to specific programs.
Given the diminishing role of the Highway Trust Fund in funding future transportation investment, federal credit assistance under the TIFIA program needs to grow in ...
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 ...
Nossaman LLP’s 30-plus infrastructure attorneys offer clients, colleagues, strategic partners, and industry media a wealth of practical experience, insider insight, and thoughtful analysis here on Infra Insight. We blog about what we know best, from industry-leading procurements to local and national policy developments that affect the market and our clients.
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