BRADENTON, Fla. — The Georgia Department of Transportation on Friday released its solicitation for qualified firms to do the state’s first public-private partnership, a plan called the West by Northwest Project that is designed to bring needed traffic-congestion relief to metropolitan Atlanta.
A concession ultimately will be granted for the design, construction, financing, operation, and maintenance of 29 miles of reversible managed lanes along Interstates 75 and 575, and pre-development activities for another 27-mile segment along I-285 and I-20.
A request for qualifications released Friday said GDOT anticipates contributing $350 million for items such as payment of right-of-way expenses, milestone-based payments during design and construction, and availability or performance-based payments.
The department will spell out exactly how its contribution will be provided by September when requests for proposals are sought, according to Earl Mahfuz, Georgia’s P3 program director.
In the meantime, prospective concessionaires have until May 3 to respond to the RFQ. The state already saw more than 300 people turn out in early December for a workshop on the project.
“We’re hoping that we’re going to get all the right players in the marketplace responding to our RFQ,” Mahfuz said Friday. “I think they will see that Georgia is serious in terms of moving forward. This is the first of a host of projects.”
Mahfuz said he and finance team members met as recently as Wednesday with officials from the federal Transportation Infrastructure Finance and Innovation Act program office to begin qualifying the project for low-interest TIFIA loans, a private-activity bond allocation, and other potential sources of funds.
Georgia’s P3 program is emerging as the bond market is becoming more interested in project financing. Several projects last year had to rely on bank financing because of market disruption. But as a sign of increased interest in P3s, officials pointed to the mid-December sale of $400 million of private-activity bonds for the North Tarrant Express in Texas.
“There was healthy appetite for the private-activity bonds on North Tarrant,” said Elliot Brown, a member of the global infrastructure group at RBC Capital Markets, GDOT’s P3 financial adviser. “Subject to things continuing as they are today, I think private-activity bonds will be an option to proposers.”
Brown said Georgia’s project could also be done with bank financing. But he added that bonds for another Texas P3 project are expected to sell this year, providing another gauge about investor interest in P3s.
Proposers for Georgia’s project most likely won’t be selling any bonds soon, since the state does not expect to reach financial close on the concession contract until July 2011.
The RFQ for Georgia’s project is available at http://ssl.doas.state.ga.us/PRSapp/PublicBidNotice?bid_op=1048400RFQ-484-050310P3.
HNTB is technical adviser for Georgia’s P3 program. Nossaman LLP is legal adviser.