Industry News

Proposed Six-Year Transportation Improvement Program Released

April 23, 2012

Public input sought on draft plan, meetings to be held across the state.

RICHMOND – The Commonwealth Transportation Board (CTB) released today the state’s working draft of the Fiscal Years 2013-2018 Six-Year Improvement Program. The program allocates $10.6 billion in funding to transportation improvements over the next six fiscal years beginning July 1, 2012. Funding goes toward highway, road and bridge projects as well as rail, transit, bicycle, pedestrian and other transportation improvements across the state.

The proposed six-year program is dependent on the General Assembly approving a two-year budget that does not include major earmarks.

Each year the six-year program is updated to reflect the latest projected revenues and transportation priorities. The overall size of the draft program is the same as the program approved last year.  Allocations are based on the following priorities:

• Complete projects under construction
• Complete preliminary engineering or right of way phases of other projects
• Maximize federal funding
• Address safety issues by funding deficient bridges and pavements
• Support transportation projects procured under the Public Private Transportation Act and the Governor’s ongoing transportation priorities

Further details will be known once public meetings are held over the next month and the board has reviewed the comments.  The final six-year program will be released in June 2012.

Draft six-year program funding breakdown:

Roads, highways and bridges - $8.3 billion

Rail, transit and other improvements - $2.3 billion
Total - $10.6 billion

Public meetings:

The draft six-year program is online at  www.syip.virginiadot.org/Pages/allProjects.aspx.  Other sources are www.VirginiaDOT.org and www.DRPT.Virginia.gov. The program can also be reviewed at Virginia Department of Transportation’s district and residency offices and the Virginia Department of Rail and Public Transportation’s Richmond office.

The public may comment about essential rail, public transportation, commuter service, bicycle, pedestrian and highway projects (except local/secondary roads) at the hearings. Public comments will be considered before the board adopts a final program in June. The FY 20013-18 program will go into effect July 1, 2012.

Public meeting schedule:

Citizens can send their comments to:

Public Information Office
Virginia Department of Rail and Public Transportation
600 East Main Street, Suite 2102, Richmond, VA 23219
drptpr@drpt.virginia.gov

Programming Director
Virginia Department of Transportation
1401 East Broad St., Richmond, VA 23219
Six-YearProgram@VDOT.Virginia.gov

Comments must be received by May 18, 2012.

VDOT and Reach Financial Close on Midtown Tunnel

April 16, 2012

Governor Bob McDonnell announced Monday that the Virginia Department of Transportation (VDOT) and Elizabeth River Crossings (ERC) reached financial close to begin construction on a new Midtown Tunnel. Financial close releases all funding needed to build the $2.1 billion project, which also includes extending the Martin Luther King (MLK) Boulevard and rehabilitating the existing Midtown and Downtown tunnels, providing a network of transportation improvements and congestion relief to motorists in the Hampton Roads region. Construction will begin in Fall 2012.

Toll collection, originally scheduled to begin in late summer, may be delayed until January 2014 pending action by the Commonwealth Transportation Board (CTB) to allocate funding. The governor is requesting the CTB allocate funds for this purpose. The project will be financed through tolls, initially ranging from $1.59 to $1.84 per car for the tunnels and $.50 for the MLK Extension for tunnel users and $1 for non-tunnel users. This is approximately 40 percent lower than the $2.89 toll rate estimated under the interim agreement signed in January 2010 before the McDonnell administration took office.

“I am requesting the Commonwealth Transportation Board (CTB) allocate up to $100 million to cover the costs of delaying tolls until January 2014. This is in addition to the significant funding VDOT has already contributed to the project to the lower tolls,“ said Governor McDonnell. “VDOT has also implemented a second toll relief measure. The parties have agreed to limit toll charges for High Street ramps to be built on the new MLK Extension. Vehicles entering or exiting the new extension from the High Street or London Boulevard ramps and taking a local trip in Portsmouth will not be required to pay tolls.”
Anticipated funding for the toll delay will largely come from funds set aside for the state’s contribution at financial close that were not needed due to current low interest rates. VDOT will present the governor’s request to the CTB at its April 18 board meeting in Richmond.

Under the Public-Private Transportation Act (PPTA), VDOT continues ownership of the infrastructure and oversees ERC’s activities. ERC will finance, build, operate and maintain the facilities for a 58-year concession period. ERC also assumes risk of delivering the project on a performance-based, fixed-price, fixed-date contract, protecting users and taxpayers from cost overruns and delays. In addition, ERC will be responsible for long-term routine and life-cycle maintenance of the project for the term of the concession.

“Financial close marks a significant step forward for transportation improvements in Hampton Roads,” added the governor. “We would like to thank the U.S. Department of Transportation for approving a $422 million TIFIA loan to help pay for construction, making financial close possible and lowering the projected tolls. Once this project is completed, motorists will save about a half-hour round trip everyday plus benefit from a much improved transportation network that will better connect the region, stimulate the local economy and create jobs.”

Because of the low interest rates and flexible repayment terms, demand for loans made under the Transportation Infrastructure Finance Innovation Act (TIFIA) is strong among states across the country. Due to the importance of the project and the firm commitment of the public and private partners, ERC was granted $422 million to build the Midtown project. ERC will pay off the TIFIA loan through toll collection.

“The Midtown Tunnel project is ranked as the number one transportation priority by the region’s leaders and is the largest project to get under way in the region in almost 30 years,” said Transportation Secretary Sean T. Connaughton. “Procurement as a public private partnership is the only feasible way to fund a project of this magnitude, and that depends on tolls.”

“VDOT and ERC are ready to begin this project now,” said VDOT Commissioner Greg Whirley. “The existing Midtown Tunnel is a half-century old and in dire need of expanded capacity for the sake of safety, reduced congestion, better travel times and improved connectivity. The project not only involves building a tunnel, but improving the transportation network in the region.”

Background information

The key components of the project include:

• Listed as the region’s top priority by the Hampton Roads Transportation Planning Organization and local elected leaders
• Doubling the capacity of the Midtown Tunnel by building an additional two-lane tunnel near the existing one under the Elizabeth River
• Reduce congestion that now causes back-ups stretching over two miles at the tunnels during peak periods – will lower fuel consumption and emissions
• Commuters to save an average of 30 minutes per day
• Reduce traffic (including heavy truck traffic) on Portsmouth city streets
• Increasing transit service between Portsmouth and Norfolk
• Rehabilitating the existing Midtown Tunnel and both of the Downtown Tunnels
• Extending the Martin Luther King Boulevard from London Boulevard to I-264, with an interchange at High Street
• Modifying the interchange at Brambleton Avenue/Hampton Boulevard in Norfolk
• Financed through tolls, initially ranging from $1.59 to $1.84 per car for the tunnels and $.50 for the MLK Extension for tunnel users and $1 for non-tunnel users. This is significantly lower than the $2.89 toll rate estimated under the interim agreement signed in January 2010 before the McDonnell administration took office
• Tolls will be collected electronically using E-ZPass, eliminating the need for toll booths
• More than 500 jobs will support construction activities and another 1,000 jobs in other sectors of the local economy. ERC plans to spend over $550 million on construction materials and supplies as well as provide subcontracting opportunities to disadvantaged business enterprises and small, women-owned, and minority businesses.
• When completed in 2018, the project is expected to cut round-trip travel time by a half-hour a day. Results will be improved safety, reliability and connectivity to the region’s transportation network.

Financing:

• The comprehensive agreement was signed last December for a value of $2.1 billion. This includes total project costs such as financing, designing, building, maintaining and operating the tunnels and the MLK extension
• Project and its financing mechanism were endorsed by the Hampton Roads Transportation Planning Organization and local elected leaders in January 2012
• VDOT’s contribution is more than $300 million specifically designated to lower the tolls by 40 percent compared to initial rates under the interim agreement signed in January 2010. Funds provided are from the Governor’s 2011 Transportation Funding Package.
• VDOT’s contribution is reduced from $362 million because it was able to secure a lower interest rate at financial close. Money saved will go back into toll relief
• The U.S. Department of Transportation provided a $422 million low interest TIFIA loan. This loan enabled the toll rates to be reduced to current levels.
• The comprehensive agreement requires ERC to take full responsibility to design, finance, build, operate and maintain the project. ERC is investing a significant amount of their own equity and is borrowing another $1.1 billion at their risk to build the project. ERC is solely responsible for obtaining and repaying all project debt.
• Toll escalation limited to the greater of 3.5 percent or changes to CPI. This is comparable to annual increase in VDOTs operations and maintenance costs.
• The comprehensive agreement does not guarantee a profit to ERC and the agreement has controls in place so ERC’s return stays at a reasonable rate. Revenues from toll collection must first be used to pay operations and maintenance expenses, debt, taxes and reserve accounts before any possible return would be realized by ERC’s equity investors.
• Should gross toll revenues reach a certain level, a percentage of the revenues would go to VDOT, which would be used for transportation improvements in and around Portsmouth and Norfolk.

Online resources:

Comprehensive Agreement:
www.midtowntunnel.org/comprehensive_agreement.asp

Amendment #1 to Comprehensive Agreement that provides VDOT with option lower tolls:
www.midtowntunnel.org/documents/CA_Amendment_No._1_web.pdf

Amendment #2 to Comprehensive Agreement that limits tolls on MLK Extension:
www.midtowntunnel.org/documents/dtmtmlk_CA_Amendment_No_2_web.pdf

Project website:
www.midtowntunnel.org

Road Construction May Stop Due to Budget Impasse

April 13, 2012

The Virginia Department of Transportation (VDOT) began notifying its contractors Friday that they must prepare to suspend work should the state budget impasse continue.  The suspension could impact 473 construction and maintenance projects valued at $2.7 billion across the state.  These are interstate, primary, urban and secondary road and bridge improvement projects.

VDOT is providing contractors with a two-month notice to wind-down their operations on a site. Since the current state budget will expire June 30, 2012, the two month wind-down period will begin May 1, 2012. VDOT has to begin the work suspension process in advance of the June 30th deadline so contractors have adequate time to stop work and get paid. It takes weeks to shut down construction projects because of extensive coordination involving VDOT and contractors regarding materials, heavy equipment, crews, work zones and several other factors. 

The wind down period would be suspended and/or projects would resume once a state budget is in place for the next fiscal year beginning in July 2012. Should the state budget be approved Tuesday all projects will continue uninterrupted.

ARTBA Fly-In May 30-31

April 09, 2012

“Make Transportation Job #1”

Meaningful reauthorization of federal transportation legislation remains elusive.  Inaction on the part of America’s transportation construction industry is not an option.  Yes, that means you, personally.

Join your industry colleagues and come to Washington to tell your elected officials there is no one piece of legislation now before Congress that could do more to immediately create jobs and boost U.S. competitiveness than the transportation bill.

May 30-31 are the dates for the Transportation Construction Coalition’s 2012 Legislative Fly-In.  The theme is “Make Transportation Job #1.”

For more information and to register, visit www.artba.org/news-events/artba-events/federal-issues-program-tcc-fly-in/

Make your room reservations directly with the Marriott Metro Center by calling 1-877-212-5752. Ask for the ARTBA Federal Issues Program rate of $274 per night which is guaranteed through April 30th.

VTCA members planning to attend are asked to let VTCA’s Jan Morehead know. She will coordinate the Virginia contingent.

Court Sides with ARTBA, Declines Expansion of “Navigable”

March 08, 2012

On February 22 all nine justices on the U.S. Supreme Court agreed with the American Road & Transportation Builders Association and refused to widen the scope of the federal Clean Water Act. In PPL Montana, LLC v. Montana, the Court unanimously declined to expand the definition of what is considered “navigable” under federal law. The ruling removes a road block that could have needlessly delayed transportation improvements.

ARTBA, the only transportation construction association involved in the case, joined with eight other industry associations in filing a brief, urging the Court to overturn a lower court holding that the entire span of three rivers in Montana was “navigable” because certain remote sections are used for recreational purposes.
For purposes of transportation development, once something is considered “navigable” it is under federal control, and subject to the permitting authority of the U.S. Environmental Protection Agency (EPA) and the Army Corps of Engineers (Corps). An expanded definition of “navigability” could have resulted in a scenario where the EPA and Corps would have the option of exerting jurisdiction over roadside ditches, potentially adding years to already expansive review and approval process for transportation infrastructure projects that are needed for increased mobility and improved safety.
The full text of the association’s brief can be found in the “current advocacy efforts” section of www.artba.org.

Governor McDonnell Announces Additional Components of 2012 Transportation Plan

January 20, 2012

Following on the heels of the Governor Bob McDonnell’s 2011 transportation funding plan which set the framework for investing nearly $4 billion over the next three years, the governor’s 2012 General Assembly session transportation plan will provide additional funding for maintaining Virginia’s infrastructure and will continue the administration’s efforts to ensure greater accountability and transparency in Virginia’s transportation entities while delivering transportation projects more quickly and cost effectively.

“Last year, working across party lines, we took a significant step forward in addressing Virginia’s long-neglected transportation system by implementing reforms to transportation agencies and by accelerating projects and bond funding that had languished in bureaucracy. Collectively, we put the most new funding into transportation in a generation,” said Governor McDonnell. “This session, we must take the necessary steps to build off of last year’s historic efforts, provide additional new funding for maintenance and construction, and continue reforming our transportation agencies to deliver projects and services more efficiently. Virginia simply cannot remain a leader in economic development and job creation if we do not continue to address our transportation challenges. That is why this year’s transportation package will dedicate additional funding to transportation and will help spur our economic recovery through job creation, forward-thinking investments and promoting our transportation assets.”

At the 2011 Governor’s Transportation Conference in Norfolk in December, Governor McDonnell called for changes in laws governing the allocation of future surpluses to transportation, dedicating portions of revenue growth attributable to transportation infrastructure projects to transportation, phasing in an additional dedication of .25 percent of the sales tax to transportation over the next eight years, establishing an Interstate 85 Connector Economic Development and Promotion Zone to encourage businesses to invest in Virginia and ship through Virginia ports, and advancing Virginia’s commercial space flight programs.

Today the governor added to those 2012 proposals by putting forward new initiatives to:

• Authorize the creation of the Virginia Toll Road Authority to construct, maintain and operate toll road facilities throughout the Commonwealth. Toll facilities currently operated by VDOT could be transferred to the authority, and the authority will provide another option for constructing major infrastructure projects without ceding complete control to a non-state partner.
• Authorize the Commonwealth Transportation Board (CTB) to sell naming rights for the Commonwealth’s transportation infrastructure. Private entities would be able to place their name on highways, interchanges, bridges and other infrastructure for an annual fee, which would go to the Highway Maintenance and Operating Fund to support maintenance. The CTB will establish rules, fees, and revenue projections for this program at a later date.
• Enhance the Barge and Rail Use, International Trade Facility, and Port Volume Increase Tax Credits adopted during the 2011 General Assembly to make Virginia’s port more competitive versus its competitors.
• Reform the Virginia Port Authority board of commissioners to ensure that the most experienced and qualified Virginians can serve on the board. Increase Virginia’s representation on the Metropolitan Washington Airports Authority board of directors to bring conformity with recently enacted federal legislation and ensure that Virginia taxpayers are fairly represented on the board.
• Codify Virginia’s seat on the Washington Metropolitan Area Transit Authority’s board of directors and implement qualifications-based requirements on appointees to the board to ensure effective governance and safety of the WMATA transit system. The qualifications-based requirements are the recommendation of the Governance Work Group comprised of governors McDonnell and O’Malley and Mayor Gray.

“Without an adequate transportation system, almost every aspect of our daily lives and government are negatively impacted,” said Governor McDonnell. “Therefore, we must get serious and start treating transportation like a core function of government. That is why I am proposing to increase transportation’s share of the sales and use tax revenues from 0.5 percent to 0.75 percent over the next eight years. My budget begins the process by dedicating an additional $110 million — only one-eighth of one percent of the total budget — to transportation over the course of the biennium. I am also proposing to increase transportation’s share of general fund surpluses to 75 percent and dedicate 1 percent of revenue growth above 5 percent to transportation. We will also expand the revenue sharing program to include maintenance, furthering our efforts to better leverage available revenues to meet Virginia’s growing transportation maintenance needs. We cannot provide additional funding without ensuring that our transportation organizations are accountable to our citizens and deliver projects in a safe, transparent and cost-effective manner. That is why my package will also include changes to continue our efforts to reform MWAA and WMATA.”

Governor McDonnell’s 2012 Transportation Initiatives (Including Proposals Announced in December)

Transportation Funding and Reform (Delegates Lingamfelter and Rust/Senator Wagner)

• Dedicates 1 percent of general fund revenue growth above 5 percent to transportation
• Increases transportation’s share of year-end surpluses to 75 percent
• Increases transportation’s share of state sales and use tax revenues from 0.5 percent to 0.75 percent
• Authorize the CTB to sell naming rights for the Commonwealth’s transportation infrastructure. Private entities would be able to place their name on highways, interchanges, bridges and other infrastructure for an annual fee, which would go to the Highway Maintenance and Operating Fund to support maintenance. The CTB will establish rules, fees, and revenue projections for this program at a later date.
• Creates transportation improvement districts wherein 25 percent of the growth in state tax revenues attributable to a transportation project will be transferred to the Transportation Trust Fund to fund other transportation improvements
• Authorizes creation of the Virginia Toll Road Authority to construct, maintain and operate toll road facilities throughout the Commonwealth
• Amends statutes regarding local transportation plans to ensure that state and federal dollars are spent in a timely and cost-effective manner

Port of Virginia Comprehensive Promotion and Reform (Delegates Cosgrove and Purkey /Senator Wagner)

• Exempts the Virginia Port Authority from bureaucratic requirements regarding environmental impact statements, outside legal counsel, surplus property and real property management to better enable the port to operate within a business environment
• Enhances incentives passed during the 2011 General Assembly to bring parity between Virginia’s incentives and our competitors
• Increases the number of commissioners eligible to serve from Hampton Roads and places qualifications based requirements on commissioners to ensure that the Virginia Port Authority is governed by business leaders with the requisite experience to run a port
• Creates the Route 460 Corridor Interstate 85 Connector Economic Development Zone to help make Virginia a leader in maritime commerce and provide incentives to business involved in manufacturing of goods shipped through the port to locate in Virginia

Virginia Commercial Space Flight Authority Comprehensive Promotion and Reform (Delegate May/ Senator Herring)

• Restructures the Virginia Commercial Space Flight Authority and the board of directors to turn it into a truly independent entity capable of growing and promoting Virginia’s role in the field of commercial aerospace

Metropolitan Washington Airports Authority (Delegate May/ Senator Colgan)

• Increases the total membership of the MWAA board of directors from 13 to 17, granting two additional seats to Virginia, one to Maryland and one to D.C.
• Increases the number of directors required to approve the annual budget and bond issuances from 8 to 10
• Prohibits directors from serving past the expiration of their terms

Washington Metropolitan Area Transit Authority Reform (LeMunyon)

• Codifies Virginia’s seat on the WMATA board of directors
• Imposes certain qualifications based requirements on those members eligible for appointment to the board of directors

NOVA I-95 HOV/HOT Lanes Project Advances

December 06, 2011

Governor Bob McDonnell announced today that the Virginia Department of Transportation (VDOT) and Fluor-Transurban have come to an in-principle agreement on the major commercial terms to build the I-95 High Occupancy Vehicle/High Occupancy Toll (HOV/HOT) Lanes Project in Northern Virginia. Agreement on the commercial terms means both parties have established the major tenets of a contract. This step forward enables VDOT and Fluor-Transurban to finalize the details of a comprehensive agreement and financing package for the $940 million project.

The in-principle agreement was negotiated between Fluor-Transurban, VDOT Commissioner Greg Whirley, and Virginia’s new Office of Transportation Public-Private Partnerships (OTP3). The project is being financed and constructed under Virginia’s Public-Private Transportation Act with $843 million financed by Fluor-Transurban, with financial close targeted to occur in mid 2012. The state contribution is $97 million, which will be used in part to advance construction activities as early as spring 2012.

The project will expand the existing HOV facility on I-95 to create 29 miles of HOV/HOT Lanes between Edsall Road in Fairfax County and Garrisonville Road in Stafford County, with improved access to major Virginia employment centers and military sites. Motorists will have an option to pay a toll to use the HOT Lanes, while carpools with three people or more and buses will have free access to the lanes.

To maximize the benefits of the new HOT Lanes network, the Commonwealth will invest $200 million to expand bus service in Spotsylvania, Stafford, Prince William and Fairfax counties, and construct more than 3,000 new park and ride spaces.

Key aspects of the agreement require Fluor-Transurban to:

• Provide a fixed-price, fixed-date, design-build contract
• Finance, design and build the facility; manage and fund all operations and maintenance for a period of 73 years following construction
• Share revenue with the Commonwealth at agreed upon rates to fund other transportation improvements in the corridor should the HOT Lanes be a financial success
• Provide substantial contract opportunities for Disadvantaged Business Enterprises and Small, Women and Minority-Owned businesses
• Maintain free access for High Occupancy Vehicles (HOV) meeting state eligibility requirements and buses
• Manage traffic levels over the long-term to facilitate quality, reliable travel for HOV 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

VDOT will continue to own and oversee all aspects of the facility to ensure the HOV/HOT lanes are constructed, operated and maintained in accordance with agreed-upon standards.

The I-95 HOV/HOT lanes will:

• Expand the I-95 HOV lanes from two to three lanes for 14 miles from Edsall Road to the Prince William Parkway, improve six miles of existing HOV lanes from the Prince William Parkway to Route 234, and extend the HOV lanes for nine miles from Dumfries in Prince William County to Garrisonville Road in Stafford County, alleviating the worst bottleneck in the region. Stafford County would have HOV lanes for the first time.
• Provide a seamless connection to the I-495 HOT Lanes (under construction) and Tysons Corner
• Allow free travel for carpools with three or more persons as well as buses, vanpools, motorcycles and emergency vehicles. Charge single-person vehicles a toll based on time of day and travel distance.

The Department of Rail and Public Transportation recently completed a study to fully maximize the benefits of the HOV/HOT lanes by identifying multi-modal solutions. Recommendations include an additional 9,575 park and ride spaces (over 3,000 of those spaces will be provided by VDOT); expanded transit routes and services from Spotsylvania, Stafford, Prince William and Fairfax counties, including adding 46 buses; 750 off-site parking spaces and shuttle services at the Franconia-Springfield Metrorail station; and vanpool, carpool and telework program assistance. Improvements are or will be funded in the Commonwealth’s Six-Year Improvement Program.

Go to www.VirginiaDOT.org for more information.