Pennsylvania taking P3 proposals

Private entities keen to pitch Pennsylvania on public-private partnerships for transportation projects have until Nov. 10 to submit their bids.

Interested companies can submit proposals “offering innovative ways to deliver transportation projects across a variety of modes including roads, bridges, rail, aviation and ports,” said a Pennsylvania Department of Transportation release announcing the open solicitation period. Proposals can also include “more efficient models to manage existing transportation-related services and programs.”

Parties can submit bids for both PennDOT-owned and non-PennDOT-owned assets.

The commonwealth invites private parties to submit P3 bids twice a year for what it says is one of the nation’s most ambitious and comprehensive P3 programs.

The department is currently considering three unsolicited bids from previous submission periods, including an expressway managed lane bid from Cintra, according to an Aug. 31 board presentation. Six proposals were dismissed and one is on hold.

PennDOT has four active P3 programs, including its high-profile $2.5 billion Major Bridges program, which replaces or rehabs major interstate bridges.

Unsolicited submissions are reviewed by PennDOT’s P3 Office and presented to a seven-member P3 board for consideration.

If the board determines that a state-run asset would be more cost-effectively run by a private entity, the company will be allowed to submit a formal proposal and enter into a contract to either completely or partially take over that operation for a defined period of time.

Lawmakers in July 2022 revamped the P3 law to strip PennDOT of its ability to impose tolls to pay for the Major Bridge program and reduced the department’s ability to impose user fees on other new infrastructure projects. The overhaul came in the wake of a court decision that struck down the bridge program. In August 2022, PennDOT chose to move the bridge projects in the program forward without tolling and pay for the projects with existing funds to make annual payments to the private partner, led by Macquarie, over a 35-year period.  The six spans identified for the program’s first package are in the final design phase.

PennDOT created the P3 program in 2012 to ease budget pressure by drumming up alternative funding for highway and bridge needs. Currently, gas taxes generate 74% of the state’s highway and bridge funding.