Articles Posted in Infrastructure

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A joint venture of AECOM, its Tishman Construction unit and STV was awarded a $19 million contract to provide construction management and other services for the Moynihan Station project which will expand Penn Station New York. Phase one of the project is estimated at $267 million and will create passenger access points in the historic post office across the street from the current Penn Station. Seven contractors have been pre-qualified for the construction contract. Tutor Perini continues its assault on the New York stalwarts.

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Virginia Gov. Bob McDonnell wants to increase the percentage of any year-end surplus and sales tax that is spent on transportation projects. According to this article, the specific proposals include:

* Increasing transportation’s share of year-end surpluses to 75 percent.

* Authorizing the Commonwealth Transportation Board to implement a version of tax-increment financing so that when the state funds new transportation infrastructure a portion of the growth in state tax revenues that result from economic development surrounding the project will go to transportation.

* Increasing the amount of existing sales tax sent to transportation from .5 percent to .75 percent over the next 8 years.

* Proposing that the first 1 percent in revenue growth over five percent each year be dedicated to transportation
* Allow the state to match local money dollar-for-dollar on capital improvements as well as maintenance within a locality.

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Virginia announced a $940 million dollar P3 agreement with Flour-Transurban. The agreement calls for the construction of a 29 mile hot lane to ease the Virginia’s traffic congestion, especially during rush hour.

The agreement calls for Fluor-Transurban to pay $843 million and Virginia to $97 million. Most of the current lanes will be toll free, as will be HOV-3 vehicles. Other vehicles will pay a toll that will vary in amount depending on the volume of traffic.

The Agreement’s Key aspects include:

  • Fluor-Transurban will design and build the facility; manage and fund all operations and maintenance for a period of 73 years following construction. It will also share revenue with the Commonwealth.

  • Maintain free access for High Occupancy Vehicles (HOV) meeting state eligibility requirements and buses.

  • Develop and operate a dynamic tolling system. Tolls will vary based on demand to provide fast, reliable travel times.

  • All tolls will be paid with an E-ZPass and there will be no toll booths.

  • Electronic signs will alert travelers to current toll rates so they can make an informed choice whether or not to use the HOT Lanes.

  • Return the asset to the Commonwealth in good working order at the end of the agreement

Link to news release

The agreement is the latest in Virginia’s foray into the P3 delivery method to meet a public need by partnering with the private sector.

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A funny thing happened at a recent ENRNewYork infrastructure conference titled Where’s the Money? — they found some. During a panel discussion concerning infrastructure financing, both Robert Dove, Managing Director, The Carlyle Group and Christophe Petit, President, Star America Infrastructure Partners, told the large audience that they had “money to spend” on infrastructure projects. Indeed, both men suggested that they were eager to find an infrastructure project in which to invest.

Interestingly, both men were looking for very different project profiles. Mr. Dove stated a desire to invest in brown field projects only, whereas Mr. Petit wants green field projects. Given the amount of money these two men represent, there is a very attractive opportunity for the promoter of the right project.

In light of this and the money Presidents Obama and Clinton have pledged to raise for infrastructure projects (see Michael McNamara’s 11/5/11 entry), perhaps some should be saying Show me the Project!!.

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If you build it, they will come. But what if someone else built it first? We just might find out the answer to that question if Guatemala goes forward with its new president’s plan to build a canal connecting the Atlantic and the Pacific Oceans. You can read about it here.

Presumably Guatemala is aware of the fact that Panama is currently building a third set of locks that will significantly expand its capacity. You can read about that here.

So Guatemala won’t just compete with the Panama Canal we all know and love; it will compete with a new and improved Panama Canal.

Perhaps it’s no surprise that Guatemala’s president proposes to build its new canal as a Public Private Partnership. That likely means that it won’t get done unless the marketplace determines that the canal would generate enough income to pay for its construction.