WASHINGTON — The Georgia Department of Transportation is poised to launch a public-private partnership initiative it hopes will encompass 17 projects, including a multimodal passenger terminal in Atlanta, connector highways, toll roads and privatized highway rest stops.
GDOT estimates that projects could range in cost from $150 million to over $1 billion. It announced yesterday that it will pursue only solicited proposals. It will not pursue six unsolicited proposals it received prior to the adoption of a new state transportation law earlier this year.
GDOT will present its wish list tomorrow to the state transportation board, which must approve projects.
Georgia is expected to shoulder about 25% to 30% of the total project costs, GDOT treasurer Earl Mahfuz said in an interview yesterday, and all financing options are on the table. They may include private-activity bonds; grant anticipation revenue vehicles, or Garvee, bonds; traditional toll revenue bonds; and credit assistance from the federal government through the Transportation Infrastructure Finance and Innovation Act program. The TIFIA program provides low-interest loans and other lines of credit for transportation projects, and is often used in conjunction with PABs.
Mahfuz added that at this stage the department is reluctant to provide details on financing.
It is “premature to talk to bonding amounts and schedules at this stage,” said Elliot Brown, associate at RBC Capital Markets, which is financial advisor for the P3 initiative.
The state created a planning division and included guidelines for private investment in construction projects. The new legislation allows Georgia transportation officials to pursue P3 projects without being required to include them in the state transportation plan.
“Our old legislation had a lot of hoops we had to jump through,” Mahfuz said.
GDOT also created a new P3 division and anticipates initiating the first solicitation for a project in late spring or early summer of next year. Mahfuz said that by June 30, the department hopes to be in the initial stage of a request for quotations, then will issue a request for proposals.
The initiative calls for “corridors that will eventually be tolled as managed lanes through the metro area” of Atlanta, six managed lanes projects that would span a half-dozen to a dozen different corridors, as well as high-speed rail and intercity passenger rail
projects.
Mahfuz said GDOT’s list includes two “non-traditional P3 projects” — a multimodal passenger terminal in downtown Atlanta near a Metropolitan Atlanta Rapid Transit Authority station and privatization of some highway rest stops and welcome centers. It also will include a toll road project in southeast Georgia.
The state conducted an analysis of project scope, financial feasibility, market interest, private sector involvement potential, and institutional political support to decide how to proceed, according to Mahfuz.
“Based on [our] experience in advising many state departments of transportation, I believe this is the most rigorous screening process we’ve implemented to date,” said Simon J. Santiago, attorney for GDOT at Nossaman LLP in Washington.
The triple-A rated state is currently in the market with $700 million of new-money and refunding general obligation bonds. As much as $400 million of that is expected to sell as the state’s first taxable Build America Bonds. Some of the new-money bonds will be used for transportation funding.
Shelly Sigo contributed to this story.
