- The Virginia DOT has started construction on a $565 million, 10-mile extension of Interstate 95 express toll lanes near Fredericksburg, Virginia. Transurban will lead construction of the public-private partnership (P3) with the VDOT and operate the lanes when complete.
- The project, dubbed "Fred Ex," will include 10 miles of new, two-lane reversible express lanes; new access points that will ease travel for the 28,000 workers at Marine Corps Base Quantico; a reversible ramp at one exit; the renovation of seven bridges; and construction of two new bridges. The work, which is expected to be complete in 2022, will generate an estimated 9,100 jobs and a $1.1 billion economic boost for the region.
- Transurban is financing the extension, which will one day join up with future I-395 express lanes and create a 50-mile corridor from Fredericksburg to the Washington, D.C., border. Transurban will also give $277 million to the commonwealth for additional projects along the I-95 corridor.
The project is part of the $1.4 billion Atlantic Gateway initiative that former Virginia Gov. Terry McAuliffe introduced in 2016. The following year, McAuliffe announced that the work would be completed using a P3 with Transurban. In addition to the $565 million from Transurban, the commonwealth received a $165 million Fastlane grant for the project from the USDOT.
Highway P3s are often looked at as money savers, and more states are using the method to deliver their highway projects.
The Ohio DOT recently completed the $634 million, 16-mile Southern Ohio Veterans Memorial Highway using a P3 made up of the John R. Jurgensen Co., Dragados USA and Beaver Excavating, according to ForConstruction Pros.com. The P3 delivered the project about 10 years sooner than would have been possible using the ODOT's traditional procurement processes and took the burden of financing and operations — at least for the next 30 years — off the state's shoulders. Completed at the end of last year, the bypass shaves about 16 minutes off commuter travel time.
But P3s aren't necessarily the best financial choice for every highway project.
An audit of the Cobequid Pass toll plaza project in Nova Scotia, Canada, according to a report from The Chronicle Herald, determined that it cost $232 million more to complete as a P3 than it would have cost to build it using traditional procurement, operations and maintenance processes. More than $100 million was added to the price tag because of more expensive private borrowing rates, along with $121 million more to use a for-profit company for operations. The audit also found that maintenance costs were $9 million more than it would have cost government employees to perform the work.