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Louisiana considering PPPs for I-10 improvements

The state is gauging interest from developers and financiers about using the framework to help finance 11 projects along its I-10 Capital Corridor.

Louisiana's transportation authority is considering using public-private partnerships to finance highway improvements after a government task force said in December the state faces a $13 billion infrastructure deficit.

The Louisiana Department of Transportation and Development issued a request for information for developers and financiers who may be interested in partnering on several improvement projects along the I-10 Capital Corridor.

The decision to explore PPPs comes after a government task force created by Louisiana Governor John Bel Edwards published a report in December that said the state had a $13 billion backlog in highway and bridge needs. One of that task force's recommendation was to use PPPs to fund projects where government spending was insufficient.

“Because financing is a key constraint on the LADOTD's ability to deliver these projects, innovative financing opportunities that minimise initial capital requirements and optimise annual cashflow expenditures are of serious interest,” the RFI document states.

There are 11 projects along the I-10 Capital Corridor, which runs from east to west in the southern portion of the state. The projects are to widen and expand lanes in certain portions of the corridor and to improve interchange connections.

Issuing a RFI is typically the first stage in a PPP process, when the procurer is trying to gauge interest and take suggestions from entities with project development or finance experience. However, Louisiana's transportation agency said it was looking to develop these projects on an “aggressive timeline”.

PPPs are being used more frequently by state and local governments to finance infrastructure projects with cash-strapped budgets. The financing mechanism is expected to become even more popular when Donald Trump moves forward with an infrastructure spending bill he once said could be up to $1 trillion and is expected to favour PPPs.

A list of 50 infrastructure projects the Trump administration considers priorities was made public last month and gives insight into the president's spending priorities, among which is the improvement of Louisiana's Lake Pontchartrain bridge.