CHICAGO – Indiana Friday picked the public-private partnership team that will build its half of the Ohio River Bridges project, saying the winning bid comes in nearly 25% below state cost estimates and cuts almost a year from the schedule.
The state tapped a team lead by Walsh Investors LLC to build Indiana’s half of the $2.6 billion bi-state project that is a joint effort with Kentucky.
Walsh’s bid totaled $763 million, down from the state’s original estimate of $987 million. The firm also said it could finish the project by October 2016, compared to the original completion date of July 2017.
Walsh Construction is also the team that will lead Kentucky’s project, Kentucky transportation officials announced Thursday. Walsh’s bid for the Kentucky side of the project came in at $860 million – down from $950 million – with a completion date of December 2016, a year and a half ahead of deadline
In an unusual step, the two states are pursuing separate financing models to build the project. Indiana is embarking on a public-private partnership that will be the largest in the state, and Kentucky is using a traditional design-build approach that relies on toll revenue, grant anticipation revenue vehicle bonds, state funds, and potentially a federal loan. The states will split toll revenue generated by the new bridges.
“The most important thing for the people of southern Indiana and northern Kentucky is that the sooner these facilities are open, the sooner the fabulous benefits will begin to be accrued,” Gov. Mitch Daniels said Friday morning after attending the Indiana Finance Authority meeting where the winning team was announced. “We’re already seeing, now that these bridges are certain, that the level of new investment and new jobs on our side of the river is rocketing. And now that people know that the facilities will actually be there in less than four years from now, we can expect even more such interest. That’s what this was always about.”
Daniels and the Indiana Budget Committee still need to approve the team.
A public meeting on the project will be held Dec. 1. The IFA will then hold another meeting Dec. 3 to make its final recommendation. The Indiana Budget Committee will review the recommendation before the governor makes the final decision.
The full winning team is called WVB East End Partners and consists of Walsh Investors LLC, VINCI Concessions S.A.S., Bilfinger Berger PI International Holding GmbH, and several other firms. Mayer Brown and Scotia Bank are also on the winning team.
Daniels, who leaves office in January, has made P3s a priority during his tenure. During his first term, the state leased the Indiana Toll Road for $3.8 billion, and it currently is engaged in two other large P3 projects with a third – which will be a partnership with Illinois – on the horizon.