Massachusetts Department of Transportation
Transportation Industry PPP Update
Project Mobility
Project Span
& Project Rest Stops
Since 1895. Member SIPC and FINRA.
The Portsmouth Bypass became the first PPP for the State of Ohio
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The Project is a 16-mile, four-lane highway
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Project cost is approximately $430, funded by:
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$230 million in Private Activity Bonds
$208 million TIFIA loan
$49 million in sponsor equity, and
$44 million in milestone payments
Project debt and equity will be paid from State Payments
PPP Agreement encompasses design, construction, finance, operations and
maintenance
2
Award of SH-288 Express Toll Lanes
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The SH-288 Project is very similar to the Route 3 South Project
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Adding toll lanes next to free lanes on an urban arterial
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This project is two dedicated toll lanes in each direction, but has a similar construction
cost
SH-288
Route 3 South
180,000 daily traffic
162,000 daily traffic
3
SH-288 (Texas) Initiated the Commercial Process after the Environmental Review and prior
to Final Design
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Procurement process took approximately 20 months
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Less right of way issues than Route 3 South
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Selected Proposer made a number of scope modifications, including:
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Eliminated flyover at one interchange
Removed one egress/ingress point
Realigned ramps at one interchange to reduce ROW from 40 feet to 15 feet
Private Developer responsible for ROW acquisition and construction permits
Price was 76% of the selection criteria
4
Apparent Differences between SH-288 and Route 3 South
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Travel time savings in the initial year appear to be similar
 SH-288 corridor population is projected to grow by over 38% (2010-2035)
 Pilgrim County population is projected to grow by 4% (2000-2030)
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Wealth levels and related Value of Time are likely to be greater in the Route 3 South
corridor
While the SH-288 Project is more ambitious in size (40 lane miles vs. 32 lane miles), the
age of the Route 3 South Project mandates numerous bridge reconstructions
While our Industry Day Interviews evidenced a preference for State-funded Availability
Payments, the SH-288 Project had three conforming bids for a revenue risk deal
5
Recent Market Activity: The Indiana Toll Road was sold out of bankruptcy for $5.725 Billion
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The 156 mile Indiana Toll Road was put up for concession bid by the State in 2006
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Winning bid of $3.8 billion
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Bank loans went into default
 Too much debt for the asset
 Revenues performed poorly during economic recession
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Final bids earlier this month
 A bid advanced by two Indiana counties funded entirely with municipal debt may have
driven private bids higher
Demonstrates appetite of pension funds for infrastructure investments
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What Does Recent ITR Sale mean to the PPP Market?
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The winning bid has a more conservative debt funding than the original private sale
(less debt, no accretion), but also invested $3.3 billion in equity
Distressed debt investors who purchase ITR debt at $.60 last year will receive $.95
While this demonstrates the massive amount of equity available for infrastructure
concessions, this transaction was driven by the need to invest billions of $
 IFM is an Australian Asset Manager of Australian and US pension funds
 IFM may have faced returning funds to their investors if they didn’t find an asset to invest in
 Greenfield toll road projects do not appeal to pension funds
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IFM investors include California State Teachers’ Retirement System, New York City Employees’
Retirement System, State Board of Administration of Florida, the Arizona State Retirement
System and the Illinois Board of Investment
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The I-77 (No. Carolina) Managed Lanes Project is the other Urban Arterial toll lane Project in
Development
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Project involves converting existing HOV lanes and building additional lanes to have
two toll lanes in each direction
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Four Development Teams Shortlisted in 2012
 Only One of the competing developers submitted a bid
 Bid was based upon lowest required subsidy
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Award was made to Cintra a year ago, with a required financial close by January, 2015
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Project has met with local opposition
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Project is still moving forward
 Cintra and NCDOT recently amended their
plan of funding to reduce the TIFIA loan
request by increasing NCDOT contribution
and private funding, and have been invited to
apply for TIFIA.
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Other States are also advancing in the PPP Industry
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New Mexico has passed PPP-enabling statute
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Colorado released an RFQ for the reconstruction of I-70 through Denver
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Kentucky is seeking tolling authority to support a PPP for the Brent Spence Bridge
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Maryland has short-listed four development teams for the $2.5 billion Purple Line
transit project
Virginia is preparing an RFQ for Express Toll Lanes on I-66
Florida closed on the I-4 Ultimate Project, a $2.3 billion Express Toll Lanes project
through Orlando and backed by Availability Payments
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Texas closed on an $847 million Express Toll Lanes project for SH-183 through Dallas
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Detroit issued an RFP for the M-1 Streetcar Project
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Managed Lanes have been increasingly adopted as a solution for congested urban roads
I-35 – 2009 & I-394
Express – 2005
SR-167 HOT
Lanes – 2008
I-15 Express
Lanes - 2001
Capital Beltway
(I-495) Express 2012
I-95 Express
Toll Lanes –
2014 (MD)
I-680 Express
Lanes - 2010
US Route 36 Exp. 2016
237 Express
Lanes – 2012
I-25 Express
Lanes – 2006
I-95/395 –
Exp. 2016
SR-91 Express
Lanes -1995
I-15 Fastrak –
1998
I-77 Express
Lanes – Exp.
2018
I-75 Express
Lanes – Exp.
2017
LBJ Express
Lanes – Exp.
2016
North Tarrant
Express Lanes – Exp.
2017
I-85 Express Lanes –
2011
SH -288 Toll
Lanes – Exp.
2018
Katy Managed
Lanes (I-10) 2008
I-595 Express Lanes
– 2014
I-75 Express Lanes –
Exp. 2019
Tampa Hillsborough
Express Way – 2006
95 Express Lanes –
2010
Publicly Funded
Revenue Concession
Availability Payment Concession
10
Recent Activity in the U.S. Toll Bridge/Tunnel Sector
Midtown Tunnel P3
$2.1 billion
Toll Revenue
TIFIA/PABs
March 2012
East End Crossing P3
$763 million
Availability/Milestone Payments
PABs
March 2013
Port of Miami Tunnel P3
$860 million
Availability/Milestone Payments TIFIA/Bank
Debt
October 2009
Goethals Bridge Replacement P3
$1.5 billion
Availability/Milestone Payments
TIFIA/PABs
November 2013
Mid-Currituck Bridge P3
$549 million (est.)
Toll Revenue/NCDOT Support
Funding Structure TBD
On Hold for NCDOT Prioritization
Pennsylvania Bridges P3
Project Overview
Winning Team Selected
Pennsylvania DOT is procuring the replacement and
ongoing maintenance of 560 structurally deficient
bridges around the state as a DBFM
Private sector partners will be responsible for
rebuilding, inspecting and maintaining the
geographically diverse bridges over the life of the
concession
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42-month construction period
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Construction expected to start in 2015
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25-year maintenance responsibility
Project will be funded by availability and milestone
payments from State
Plenary Walsh Keystone Partnerships priced $721
million PABs last week – largest PABs issue ever – to
help fund the project
Accelerated Schedule
February 2013 – P3 option raised
October 2013 – Industry forum
December 2013 – RFQ released (5 responses)
March 2014 – Four teams shortlisted
July 2014 – PABs allocation announced
August 2014 – RFP responses received
October 2014 – Plenary/Walsh team selected
February 2015 – PABs priced
March 2015 – Financial close expected
1Q15 – Bridge construction commences
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Activities to Date: Project Mobility
Project Mobility – Milestones Achieved
Milestone
Projected Timeframe
Introductory meeting w/ FHWA District
Q3 2014
Initiate Legislative Outreach
Q3 2014
Industry Day
Q3 2014
Refined Scope for Braintree Split
Q4 2014
Initial Traffic Forecast
Q4 2014
Meeting with FHWA HQ
Q1 2015
Sketch Plan of Finance
Q1 2015
Initiate Public Outreach
Q1 2015
Request Inclusion in LRTP
Q1 2015
Activities to Date: Project Span
Project Span – Milestones Achieved
Milestone
Projected Timeframe
Introductory meeting w/ FHWA District
Q3 2014
Initiate Legislative Outreach
Q3 2014
Industry Day
Q3 2014
Initial Traffic Forecast
Q4 2014
Meeting with FHWA HQ
Q1 2015
Initiate Public Outreach
Q1 2015