On August 3, 2014, the Florida Department of Transportation (FDOT) and the Port of Miami achieved an important milestone when the est. $1 billion Port of Miami Tunnel opened for traffic. The project consists of twin tunnels under Biscayne Bay linking Port facilities on Dodge Island with a widened MacArthur Causeway and I-395. One of the first public-private partnerships in the United States to use an availability payment contracting structure, the tunnel improves access for freight trucks and cruise passengers, reducing traffic congestion in downtown Miami and improving air quality.
Under the concession agreement, FDOT made milestone payments to the concessionaire during the construction period, upon the achievement of contractual milestones. With the operating period now underway, FDOT will make availability payments to the concessionaire, contingent upon lane availability and service quality. The project was awarded to a Concessionaire headed by Meridiam (approx. 90% equity) and Bouygues Construction (approximately 10% equity) and reached financial close in October, 2009, at the height of the recession following the collapse of Lehman Brothers.
In March, President Obama toured the construction site for the new tunnel while promoting a new initiative intended to encourage more projects like the Port of Miami Tunnel. The president emphasized the important role of partnerships between public and private sectors as a part of the solution to the critical need to rebuild and upgrade the nation’s roads, bridges and ports.
Financed with the combination of bank loans and a TIFIA loan, the project has received numerous awards, including The Bond Buyer’s 2010 Nontraditional Financing Deal of the Year, Global Deal of the Year and P3 Deal of the Year from Project Finance Magazine in 2009, Project Finance International’s 2009 North American P3 Deal of the Year and the 2007 Project of the Year by the American Road and Transportation Builders Association.
Patrick Harder, chair of Nossaman's Infrastructure Group, is widely known for leadership in the field of public-private partnerships (P3s) and other innovative project delivery methods such as design-build and construction ...
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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