A group led by Goldman, Sachs & Co. and three foreign toll road operators have launched a nonprofit coalition dedicated to promoting public-private partnerships as a cost-effective way to maintain and improve the nation’s crumbling transportation infrastructure system.
Peter Loughlin, executive director of the group, America Moving Forward, yesterday declined to say how many members make up the coalition, but noted that they come from the transportation and finance industries.
The group includes firms from a range of fields interested in promoting and developing so-called P3s in the U.S., “from concessionaires, to contractors, industry associations, [and] investment banks,” Loughlin said. “It is a diverse coalition that wants more private sector investment partnered with public entities.”
The coalition’s steering committee, which is responsible for providing guidance on overall strategic direction, consists of representatives from Goldman, Australian firms Macquarie Bank Ltd. and Transurban Group, as well as Spain’s Cintra Concesiones Infraestructuras de Transporte, Loughlin said. The firms have all been active in developing the U.S. P3 market and have been involved in many of the deals that have been done to date.
For example, Transurban was part of a team that closed on a deal last month to build 14 miles of high occupancy toll lanes on Interstate 495 in Virginia. The project is expected to cost $1.9 billion and the team will cover $350 million of the cost. The team is also responsible for repaying a $588 million U.S. Department of Transportation loan and $587 million of tax-exempt private-activity bonds that the recently created Virginia Capital Beltway Finance Corp. is expected to issue by June. The private firms will operate, maintain, and collect the tolls from the high occupancy toll, or HOT, lanes for 75 years after construction.
America Moving Forward does not include any public sector members and currently does not intend to directly lobby Congress, state legislatures, or localities, but may in the future, Loughlin said.
“Right now the focus is and the mission is to [implement an] educational and advocacy campaign, which is not targeted to federal, state or local government,” he said. The campaign will consist of “reaching out to industry, educate them about what we are doing, what [P3s] are all about, what [P3s] can mean to the county, what it can mean to a particular state, as well as disseminating and distributing information, and primarily acting as a resource” through the group’s Web site.
Formation of the group comes after the I-35W bridge in Minneapolis collapsed in August, killing 13 and injuring over 100, which brought the attention of the public and lawmakers to the state of the nation’s infrastructure.
“It’s no secret American infrastructure has reached a crisis point as maintenance costs grow and state budgets shrink,” the group said in a statement. “Public-private partnerships are a win-win for commuters and all levels of government. Allowing private investment in our roads, highways and bridges enables governments to climb out from under the crushing cost of maintaining their critical transportation infrastructure and put scarce funding toward other spending priorities.”
Creation of the group also comes as some in Congress have questioned whether allowing private firms to take over public infrastructure, for generations in some cases, is in the public interest. A group including the American Trucking Association formed a coalition in February opposing P3s. That coalition is called Americans for a Strong National Highway Network.