The state of Virginia and a consortium of engineering firm Fluor and infrastructure fund manager Transurban have edged closer to securing financing for a $940 million highway expansion public-private partnership (PPP) along Interstate 95 (I-95).
Governor Robert McDonnell announced that the Virginia Department of Transportation (VDOT) reached a non-binding, “in-principle agreement on the major commercial terms to build the I-95 High Occupancy Vehicle (HOV)/High Occupancy Toll Lanes (HOT) Project,” according to a statement.
The development is a positive one, but remains an “interim step toward a final signed contract, scope and financing,” a Fluor spokesman said. Still, the state and the consortium are now in a stronger position to complete the PPP, which will see Fluor/Transurban invest $843 million in the project with the state contributing the remaining $97 million.
Financial close is expected to occur midway through 2012, according to a press release.
“Through this action, we will put to work nearly $1 billion in private sector investment to address one of Virginia’s most critical transportation needs,” Governor McDonnell noted in a press release. The I-95 expansion and toll road concession is expected to create thousands of jobs, relieve traffic bottlenecks and provide travel alternatives.
The project will expand an existing patch of HOV on the I-95 and will introduce HOT lanes across a 28-mile span between Fairfax and Stafford Counties. If awarded to the Fluor/Transurban team, it will also bring synergies with a separate VDOT PPP awarded to the two partners – the Capital Beltway HOT Lanes Project outside of Washington D.C., which remains under construction.