Virginia tunnel P3 unconstitutional

A judge said the Virginia Department of Transportation has no right to toll the Downtown Tunnel/Midtown Tunnel/MLK Extension project.

A circuit court judge ruled a toll bridge project and precedent setting public-private partnership (PPP or P3) in Virginia unconstitutional.

The state legislature should not have let the Virginia Department of Transportation (VDOT) toll the Downtown Tunnel/Midtown Tunnel/MLK Extension project under the Public Private Transportation Act of 1995 (PPPA), a judge said.

In spite of the ruling, construction and development of the project – a multi-billion dollar P3 with Macquarie Group and Skanska – will go on, according to the VDOT.

In 2012, consortium Elizabeth River Crossing – teaming Macquarie and Skanska – and the VDOT reached financial close on the P3.

The project, entailing a new two-lane, 17,000 meter submerged tunnel for car transport, as well as improving the existing Midtown Tunnel and extending the Martin Luther King Freeway (MLK Freeway), has a 58-year concession agreement.

Governor Bob McDonnell, a Republican and proponent of private investment in public transportation infrastructure, said Virginia will appeal the ruling. Under McDonnell and predecessor Tim Kaine, VDOT partnered with the private sector and introduced a P3 office.

Electronic tolling on the Downtown Tunnel as well as the Midtown Tunnel would start in 2014. A spokeswoman for Macquarie declined comment. A media representative for Skanska could not be reached for comment.