PublicPrivate Partnerships PPPs Greenfield Projects

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Public-Private Partnerships (PPPs)Greenfield
Projects
February 28, 2007
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What is a Greenfield Project?

• New Alignment or Corridor
• Little supporting development at the facility
• The developer has a plain piece of paper
• Offers greater flexibility, but with more risk
• Generally, the developer must be patient, but has
  greater impact on the outcome

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New Corridors

• Anticipate all will be tolled
• Over 91 of new corridors in Florida over past 15
  years are toll facilities
• Likely future new corridors and possibly new
  lanes on re-use corridors to be tolled

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Florida Tolling Model

• Toll Systems leverage overall system to improve
  existing facilities and build new toll
  facilities
• Turnpike System
• Authorities like Orlando-Orange Co. Expressway
  Authority and Miami-Dade Expressway Authority
• Start Up Toll Facilities generally subsidized to
  jump start
• Toll Facilities Revolving Trust Fund loans,
  Operations Maintenance (OM) covenants/subsidies
  
• DOT operates/maintains
• Tampa South Crosstown, Mid-Bay Bridge

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Tolling and PPPs

• New Corridors likely to be financed through
  tolling
• Demonstrated willingness to accept/use toll
  facilities in most major urban areas
• Examine and consider all possibilities including
  PPPs and existing models for tolling
• PPPs may offer advantages in some situations to
  advance the corridor forward

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Why Choose P3 as Option?

• Traditional sources are committed to existing
  projects
• P3 will bring additional investment funds to
  develop asset
• Toll Revenue
• Private Sector Financing
• Delivery Time for Project

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Why Choose P3 as Option?

• State performs a value for money analysis
• Used to determine best approach to timely
  delivery of asset (Public/Private)
• Determines financial capacity and Gap
• Defines potential funding solutions and
  approaches
• Turnpike
• Expressway Authority
• Public Private partnership

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What drives Decision - Risk

• Key Greenfield Assumptions
• It is all about the risk profile for the project
• Development Risk Need Now
• Political Risk Local Priority
• Operational Risk New Technology
• Revenue Risk Does not meet traditional
  feasibility test requirements or to large for
  existing toll system options (TP)
• Risk equals Cost/Time
• Developer will price each risk
• Term is partially defined to recover cost of Risk

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Working to each others strengths!

• Typically developers want public sector to
• Do majority or all environmental work Define
  Project
• Acquire majority of ROW
• Interact with Local Authorities Buy In
• Private side primarily focused on
• Design/Construction efficiency Forming Joint
  Ventures
• Traffic Long Term Traffic Revenue View
• Toll rates Generally Market based
• Maintenance and Operations
• Concession period Tailored to financing need
  30-75 yrs
• Revenue Stream Participation/Sharing

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Facilitating PPPs in Florida

• Some Greenfield Toll Corridors being considered
• First Coast Outer Beltway
• I-595 Ft Lauderdale - Express Lanes
• US 331 Widening (bridge)
• New Corridors
• Interstate/Turnpike Express Lanes