Pennsylvania bill expands transportation P3 authority to counties, top two cities

Pennsylvania is taking a close look at a handful of proposed public-private partnerships, including a $5 billion proposal for new toll lanes, while a bill moving through the state Legislature would expand transportation P3 authority to local governments.

The commonwealth's Public-Private Transportation Partnership Board, which oversees one of the country's most ambitious P3 programs, Tuesday voted to advance a $75 million, 20-year design-build-finance-operate-maintain concession for an autonomous shuttle system at the Pittsburgh International Airport. The PennDOT P3 Office also presented updates on other solicited and unsolicited P3s.

At the same time the board is closely watching legislation that would allow counties and the two largest cities to enter into their own transportation P3s, said chair Pennsylvania Secretary of Transportation Michael Carroll.

"The department is fully supportive of this legislation," Carroll said.

The House on Monday unanimously passed House Bill 2469 and it now moves to the Senate. The measure allows all 67 counties and the cities of Philadelphia and Pittsburgh to use P3s for the financing, construction, operation and maintenance of transportation projects and facilities. There is no date yet for consideration in the Senate.

Current law allows only PennDOT and certain transportation agencies to use P3s.

Alleghany County lawmakers are in favor of the bill, members of the P3 board said Tuesday, which is a "good sign," Carroll said.

The measure could impact a proposal that the P3 office is evaluating with the city of Pittsburgh: an unsolicited bid from S&B USA Construction for an accelerated replacement of a bundle of the city's bridges over a three-year period with a price tag between $150 million to $400 million.

The proposal calls for an accelerated progressive delivery of city-owned bridges based on a DBFOM model. The P3 office and the city are in the midst of a detailed analysis, which is required under law before a project can advance, P3 Office director Michael Bonini said. They hope to complete the analysis by the fall, he said.

"Our expectation is that we'll have the data collected for the detailed-level screening later this year," Bonini said. "It's coming down to the city working with the department to see what bridges might benefit and how it would be paid back," he said. "If the city determines it's not in their best interest, then we won't share that detailed-level screening. It's a determination they have to make because it's their assets."

The Pittsburgh bridge proposal is one of four P3 unsolicited proposals the P3 office is reviewing. The biggest proposal was submitted last October by industry heavyweight Cintra. It calls for four new tolled managed lanes, two in each direction, along a 17-mile section of I-76.

The DBFOM proposal carries an estimated $5 billion price tag that would include a $200 million payment to PennDOT. It would include a 50-year maintenance period and would also improve the general purpose free lanes.

PennDOT is in the initial stages of a detailed analysis on that proposal as well, Bonini said, examining everything from the appropriate delivery strategy to the environmental and public impact. The review is scheduled to be completed by next year, he said.

Another unsolicited proposal calls for a new tolled interchange off I-95 in South Philadelphia that would cost between $500 million to $600 million. The office expects to finish its review by 2027.

The office has dismissed four other unsolicited proposals, including a Cintra bid to create a statewide vehicle road usage charge platform pilot program. The proposal was not advanced enough to be considered as a P3, Bonini said.

The state received three smaller technology-based unsolicited proposals in April: "Keep Pennsylvania Moving" from Cessna Communications Inc., for radio transmission, and two from EFESO Management to increase PennDOT workforce productivity on the roads and at airports.

All three have advanced moving to the detailed review stage, Bonini said.

The P3 office is considering two solicited bids, including one for more office space at the Pittsburgh International Airport and one that would modernize existing carpool lanes along I-279 and I-579 to improve traffic flow into downtown and suburban Pittsburgh.

The commonwealth's Major Bridge Program, a DBFOM P3 led by Macquarie Capital and Shikun & Binui (SKBNF) that replaces and rehabs six major interstate bridges by 2028, is about 60% complete and the state is optimistic it will meet all deadlines, a PennDOT official told the board. A $1.12 billion Rapid Bridge Replacement program with Plenary that covers 558 spans across the state is in the maintenance stage and hitting its targets, the official said.

Pennsylvania won an 'A' rating from privatization advocates in a February report that ranks U.S. states on their P3 profile. The state has a long history of P3 success, broad enabling legislation and broad use across multiple sectors.