NCDOT: Ripple effect of I-77 toll-lanes bill costly, damaging

Source: Erik Spanberg, Charlotte Business Journal, June 13, 2016

Expanding Interstate 77 and canceling the private contract to build toll lanes would cost $800 million — including a $300 million cancellation fee, according to figures disclosed in a letter from the state transportation department to lawmakers. The figure, if accurate, is higher than the $650 million budget to build the 26-mile toll lanes project by private contractor I-77 Mobility Partners. Nick Tennyson, N.C. transportation secretary, sent a letter late last week to the chairs of the state Senate’s transportation committee as part of a campaign to stop a bill that would end the toll lane construction contract with I-77 Mobility Partners. The N.C. House passed the bill by a vote of 81-27 this month. That sent the measure on to the Senate, where two committees — transportation and finance — would have to approve the bill going to the floor for a final vote. … Opponents of the project argue Cintra won’t be able to complete the 50-year contract or repay all of the debt, citing similar toll-lane expansions that wound up in bankruptcy in Indiana and Texas. The state says the Cintra contract provides protection to prevent taxpayers assuming construction debt, an assertion critics say in inaccurate. In addition, opponents argue the toll lanes will do little to relieve congestion and are poorly designed. Backers point to state and regional representatives approving public-private partnerships and toll lanes as a transportation strategy for years leading up to the agreement reached between Cintra and the state in 2014. …

Related:

House Approves Bill To Kill I-77 Tolls
Source: David Boraks, WFAE, June 2, 2016

The state House of Representatives on Thursday approved a bill calling on NCDOT to cancel the I-77 widening project north of Charlotte. The bill now goes to the Senate, where Senate leaders have said they don’t see a need to cancel the project. Gov. Pat McCrory and the DOT have said they’re committed to the $650 million contract with I-77 Mobility Partners, a subsidiary of Spain-based Cintra. The company started grading and other work last November. Bill co-sponsor Charles Jeter of Huntersville says the state has the right to cancel the contract because Cintra failed to disclose lawsuits over similar projects elsewhere.   House Bill 954 passed 81-27. It also would prohibit the state from partnering with a private company on any future toll-lane projects in Mecklenburg and Iredell counties. …

North Carolina Lawmakers Want to Ax State’s First P3
Source: Shelly Sigo, Bond Buyer, May 4, 2016

North Carolina’s first tollway pact with a private developer closed financially a year ago, yet remains so controversial that some want it terminated no matter the cost. Two state lawmakers have filed bills to end the public-private partnership with I-77 Mobility Partners, a move that a state analysis said could cost $300 million or more. North Carolina’s attorney general has opened an inquiry into the P3, whose main backer is Cintra Infraestructuras SA. … Though the deal was inked a year ago, the fate of the $648 million project to add tolled managed lanes to Interstate 77 is shaky despite studies concluding that express lanes would improve severe congestion in the fast-growing Charlotte region. … Under House Bill 950, sponsored by Rep. Tricia Cotham, D-Matthews, the state Department of Transportation would be required to terminate the P3 agreement, and pay damages or monetary penalties from unobligated funds in the agency’s budget. … HB 954, filed by Rep. Charles Jeter, R-Huntersville, also seeks to cancel the agreement. Jeter’s bill appropriates $25,000 from the highway fund to pay legal fees to determine the amount of damages, although it does not designate a funding source to pay any penalty.

NCDOT taking steps to ‘reassess’ Cintra contract after TX road bankruptcy
Source: Nick Ochsner, WSMV, March 2, 2016

The North Carolina Department of Transportation said it is reassessing its contract with the company contracted to build toll lanes along I-77 after another road the company operates declared bankruptcy. A subsidiary of Cintra, the Spanish-owned company that holds the I-77 contract, declared bankruptcy today on a road it operates in Texas. … This is the second road operated by a Cintra subsidiary to declare bankruptcy in the past 18 months. In a short press release announcing McCrory’s decision, NCDOT underscored Cintra’s business model, which lawmakers in other states have warned against. …

Public-private partnership in N.C. to add toll lanes to fastest growing area in U.S.
Source: Peter J. Gallanis, Transportation and Infrastructure Daily, July 20, 2015

I-77 Mobility Partners achieved financial closure for the construction and operations of the North Carolina I-77 Express Lanes project that represents a significant milestone in the redevelopment and expansion of a critical business corridor in the Charlotte region. The $648 million project will extend 26 miles from the I-77 connection with I-277 in Charlotte to just north of Exit 36 in Mooresville. The express lanes are dedicated travel lanes that will run adjacent to the existing general-purpose lanes on I-77. Two express lanes will run on I-77 in each direction between Charlotte and Exit 28 in Cornelius. One express lane in either direction will run from Exit 28 to Exit 36. Motorists will have a choice to use the express lanes, the general-purpose lanes or a combination of both to allow for a more efficient drive. The “pay to use” concept, and the public-private partnership being used by North Carolina for this project is becoming popular as states attempt to make up for a lack of funding from the Highway Trust Fund, due to expire at the end of July…One-hundred eighty-nine million for the project comes from a Federal Transportation Infrastructure Finance and Innovation Act (TIFIA) loan; $100 million in Private Activity Bonds (PABS); $248 million in private equity from investment partners; and $95 million in public funds from the North Carolina DOT.