By DAVID BORAKS
A partnership led by Cintra Infraestructures, a Spain-based transportation construction firm that specializes in toll lanes, is the apparent winning bidder on the N.C. Department of Transportation’s I-77 widening project north of Charlotte.
Cintra estimates it will cost $665 million to add lanes, including so-called high-occupancy toll lanes, or HOT lanes, to 26 miles of the traffic-clogged road from the Brookshire Freeway/I-277 north to Exit 36 in Mooresville. That’s higher than the $500 million to $550 million that officials previously estimated.
The NCDOT still must review Cintra’s proposal, but officials said Friday they hope to sign a contract in June, and construction could start as early as December. The project could be done in 2018, the DOT said.
A DOT spokeswoman said details of Cintra’s proposal, including potential toll rates, weren’t available Friday. Another spokesman said the company’s bid proposal is not a public record, though a final contract would be. (See the DOT’s bid documents at the link below.)
Cintra is leading a joint venture that includes F.A. Southeast, W.C. English, and the lead design firm of The Louis Berger Group. The partnership was chosen from among several bidders. NCDOT has told local officials in Lake Norman that four companies have been involved, but the department has not said how many submitted final bids.
When signed, the agreement would be one of North Carolina’s first public-private partnerships, which officials refer to as a P3, for a major road project. The deal calls for the Cintra-led group to finance most of the cost of the project itself, recovering its investment through toll revenue over the next 50 years.
By incorporating tolls (referred to as “managed lanes”) and working with a private partner, the project was able to qualify for additional federal funds not available for other road projects. Officials say that helped moved the I-77 north project up on the state’s priority list, where the number of projects that can be built is limited because of scarce state and federal funding.
The NCDOT said it would contribute $88 million for the project, about half the $170 million it originally projected.
“We are excited to take this significant step forward and address a critical need,” NCDOT Chief Engineer Mike Holder said in a press release. “Innovative funding solutions like this one are vital to keep up with growth and infrastructure needed to strengthen the economy despite declining transportation revenue from traditional sources.”
Local officials welcomed the news.
“This is a significant announcement, and it starts the clock on whether this is actually going to come true,” said Bill Thunberg, executive director of the Lake Norman Regional Transportation Commission.
The towns of Mooresville, Davidson, Cornelius and Huntersville formed the commission in 2008 to coordinate planning and lobby for transportation improvements in the region. Thunberg said Friday that widening I-77 has been one of the LNTC’s main goals.
“With the level of congestion that we have along the I-77 corridor, if somebody taps on their brakes in Rock Hill, it ends up being a 20-minute delay at Exit 28,” he said. “It’s a vital transportation corridor for this region.”
The widening project “will help improve the attractiveness of this area to industry as well, to know that we have a plan in place to cope with congestion,” Thunberg added.
Davidson Mayor John Woods said the I-77 widening would have “a long-lasting effect on our region.” He said the use of a public-partnership has been critical.
“Although we haven’t got all the details before us, this announcement certainly proves locally that P3s are a viable method to structure and pay for large projects,” he said. “In addition, this announcement confirms the viability of our I-77 widening project and certainly greatly accelerates the project completion, which is so badly needed in our region.”
Cornelius Mayor Chuck Travis said: “This is great news that we have a P3 concessionaire that’s been successful.” He also applauded the proposal for requiring a smaller state contribution than originally expected, which means those dollars can be spent elsewhere.
“I think we’re at a critical point in our region where we have to do something to I-77,” Travis said. “We’re actually at the point now where we’re seeing the reverse commute stopping traffic. We’re just seeing a complete shutdown of the system.” Failing to act now could have negative affects on economic development in the Lake Norman area, he said.
The project has not been without its critics. A group called Widen I-77 over the past couple of years has lobbied against the DOT’s plan, criticizing its use of toll lanes and the P3 financing model. That group has called on state officials to divert money from other transportation projects to pay for I-77 north of Charlotte.
Critics also have objected to the possibility of a foreign company leading the project. But Thunberg said Friday that major projects of this type are inevitably global in scope these days.
“Foreign companies, when it comes to this type of project, they have the expertise, because they have had 40 or 50 years of experience with this type of project,” Thunberg said. “The U.S. companies don’t have that level of experience.”
He noted that the partnership is a mix of U.S. and foreign companies.
News reports have said recently that project had been significantly delayed, with completion pushed back a year. Thunberg said that’s not accurate. While the project completion date has been pushed from 2017 into 2018, the difference is only a few months, not a full year, he said.
HOW MANAGED LANES WORK
The project calls for two high occupancy toll lanes in each direction from the Brookshire Freeway/I-277 in Charlotte to Exit 28/Catawba Avenue in Cornelius. One HOT lane in each direction would be built from Exit 28 to Exit 36/NC 150 in Mooresville. Officials say two extra lanes aren’t possible on the northern section because of the narrow causeways over Lake Norman in Cornelius and Davidson.
Tolls would be charged using electronic radio transmitters in commuters’ cars. The tolls would not be mandatory – drivers could opt to stay in general purpose lanes and continue to ride for free. And tolls would be waived for cars with multiple occupants.
Tolls would vary through what’s called “dynamic pricing,” rising or falling as congestion increased and demand for a reliable ride to or from Charlotte increased.
RELATED COVERAGE AND LINKS
See the DOT’s proposed contract and other bid solicitation documents at NCDOT.gov
See past coverage of the I-77 widening project and other NCDOT news under the “HOT lanes” tag on DavidsonNews.net.
NC DOT ANNOUNCEMENT
Here’s the text of the April 11, 2014 announcement from the NCDOT.
NCDOT Announces Public-Private Partnership Project to Improve I-77 Traffic Flow in Charlotte Area
RALEIGH – The N.C. Department of Transportation announces the apparent successful bidder for its first Public-Private-Partnership (P3) contract to improve the traffic flow along 26 miles of I-77 in the Charlotte area, one of the most congested roadways in the state.
P3 contracts are an innovative way of leveraging new funding sources to lessen the financial impact to the state and help complete projects sooner through investments by a private firm. Following a required bidding process, and pending final review, it appears Cintra Infraestructures, S.A. will construct the I-77 project through a joint venture with F.A. Southeast, W.C. English, and the lead design firm of The Louis Berger Group.
Cintra, a world-wide leader in managed lanes projects, estimates the total project cost at $655 million. Cintra will invest the majority of that in return for toll revenue generated from the managed lanes. NCDOT will contribute $88 million for the project, which is significantly less than the $170 million it had projected.
The agreement is expected to be signed in June, with construction beginning as early as this December. The project is expected to be complete in 2018.
“We are excited to take this significant step forward and address a critical need,” said NCDOT Chief Engineer Mike Holder. “Innovative funding solutions like this one are vital to keep up with growth and infrastructure needed to strengthen the economy despite declining transportation revenue from traditional sources.”
About Managed Lanes
Managed lanes give drivers a choice to pay a toll to avoid waiting in traffic, while helping ease congestion on the free, general-purpose lanes for other drivers. The proposed I-77 project includes converting the current High-Occupancy-Vehicle (HOV) lanes, which already exist along I-77, and adding capacity to the roadway. The existing HOV lanes and new lanes will be High-Occupancy managed lanes that allow free use for eligible carpoolers (three passengers or greater), buses, and motorcyclists, while allowing other drivers to pay a toll to use those lanes. Tolls will vary to control the number of vehicles in the High-Occupancy lanes and help ensure free-flowing traffic even during morning and evening rush hours. The price would be higher during peak periods when demand is greater, and lower during less congested periods. Drivers can still use free, general-purpose lanes to avoid paying a toll. This project will not remove or add any general-purpose lanes. A number of other states including Virginia, Florida, Texas, Colorado and California are already using managed lanes.
The project will add capacity to I-77 between Brookshire Freeway (Exit 11) in Charlotte and N.C. 150 (Exit 36) in Iredell County. This portion of the I-77 corridor already experiences significant congestion and projections show a 2-to-3 percent increase in traffic volume is expected every year through 2030.
Improvements will also include a flyover bridge to provide the managed lanes direct access from I-77 to I-277, and the widening of southbound I-77 lanes in some areas. The added lanes will increase capacity through the corridor, improve travel time reliability, improve air quality and better manage traffic flow along I-77.
Cintra has more than four decades of experience as a private developer of transportation projects around the world. Its current projects include locations in Texas, Indiana and Illinois, as well as in Canada, Spain, The United Kingdom, Portugal, Ireland and Australia.