Cost-Cutting Plan for Bi-State Bridge Project Could Advance Federal Approvals

BRADENTON, Fla. — A $500 million cost-cutting proposal for the $4.1 billion Louisville-Southern Indiana Ohio River Bridges Project could result in a review of federal approvals for the mega-project, a Kentucky transportation spokesman said.

Options for downsizing elements in the long-planned project and eliminating tolls on several facilities will be explored, according to a joint announcement Tuesday from Kentucky Gov. Steve Beshear, Indiana Gov. Mitch Daniels, and Louisville Mayor Greg Fischer.

The project was designated a national transportation priority during the administration of George W. Bush. It calls for building two new bridges across the Ohio River and reconfiguring a major downtown Louisville interchange known as “spaghetti junction” where interstate highways 64, 65, and 71 converge.

The two states created the Louisville and Southern Indiana Bridges Authority last year to work on a finance plan based on a design accepted by the Federal Highway Administration. The FHWA issued a “record of decision” confirming the location of the bridges and the final environmental-impact statement in 2003 and approved the initial financial plan submitted by the two states in January 2008.

An updated preliminary plan of finance was approved by the bi-state authority last month and sent to the FHWA. The plan anticipates the project will be bankrolled by state and federal transportation funds, federal discretionary program funds, and tolls.

Financing through tax-exempt toll revenue bonds and public-private partnerships is also being studied.

“The governors and the mayor made the announcement with the full expectation that the adjustments they proposed could be made entirely within the parameters of the record of decision,” Chuck Wolfe, a spokesman for the Kentucky Transportation Cabinet, said Thursday.

However, the final determination is up to the federal agency, which could decide to evaluate the redesigned project in two ways, he said. It could be evaluated within the scope of a federal environmental impact statement that has already been approved or require a more time-consuming supplemental environmental impact statement, Wolfe said.

“Whichever way we have to go, the feeling is we can still hit the target date of August 2012 to begin construction,” he said.

Growing anti-toll sentiment may be one reason for the recent downsizing announcement, which eliminates some tolling options and could make financing more difficult. The bi-state agency, created last year, is exploring tolling options that include an ongoing time-of-day study to support variable-rate tolling to finance a portion of the project.

Two Kentucky lawmakers filed bills Tuesday to prohibit tolls on existing roadways. If passed, the legislation could force the bridge authority to seek other revenue sources.

Members of the bi-state agency, meeting Thursday in New Albany, Ind., welcomed the direction to reduce the scope of the project, according to Wolfe, who attended the meeting.

The authority will explore additional cost-saving solutions in design, construction, and financing at an industry forum in February.

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Transportation industry Kentucky
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