Limits proposed on public-private partnerships

Feb. 2007 I-70 near Bakerville

Legislation introduced would put bookends on use of P3′s in Colorado

by Allen Best

DENVER, Colo. – Legislation that would more sharply define Colorado’s ability to use public-private partnerships to pay for Interstate 70 and other transportation expansions will get its first hearing on Tuesday in a Colorado Senate committee hearing.

The bill introduced by Sen. Matt Jones, a Democrat from Louisville, would restrict contracts for the partnerships, commonly called P3’s, to a maximum 35 years unless expressly authorized by the Legislature.

This would be 15 years less than the contract approved by the Colorado Department of Transportation this winter for U.S. 36 between Boulder and Denver. That 50-year contract gives the private company the responsibility for funding the Louisville-Boulder leg of highway widening and also delegates maintenance of what once was called the Denver-Boulder Turnpike. In return, the company can collect tolls on the new express lane from Boulder to Denver, subject to certain restrictions. The new lane now under construction will also be used by expedited public buses. See story from early February here.

The 35-year limit would be more in line with policies in other states, says Jones, and would also recognize that transportation systems of today may look very different in the future. “They’re already experimenting with self-driving cars in California,” he says.

A second component would specify standards for public transparency. In the case of the U.S. 36 project, C-DOT and its subagency, the High-Performance Transportation Enterprise, consulted with municipalities and counties along U.S. 36—but did not conduct other open meetings. The bill submitted by Jones would require public and legislative check-ins at critical points, including town hall meetings.

“People have a right to know what is happening to their roads and not have surprises. And we did have surprises on 36,” says Jones.

Jones says he would prefer even more transparency, including public inspection of the contract, but has been told by many sources that such a requirement would kill P3s in Colorado.

Amy Ford, spokeswoman for C-DOT, says the agency is neutral on Jones’ bill, but that shouldn’t be interpreted to mean it dislikes provisions in the bill. “We are very open to saying there are things we could do better, in terms of informing the public,” she says. And C-DOT is very open to limiting P3s contract lengths.

With the public unwilling to fund increases in gas taxes, many state transportation agencies have seen P3′s as a way to build infrastructure. The National Conference of State Legislatures in February reported that 33 states and Puerto Rico now have legislation enabling transportation P3’s. See reports: http://www.ncsl.org/research/transportation/public-private-partnerships-for-transportation.aspx\

Use of P3’s has been controversial. In Chicago, public parking was delegated to a private company with terms widely perceived as a giveaway of public assets.

In Colorado, C-DOT continues to examine various transportation expansions – including Interstate 70 from Silverthorne to Floyd Hill—through the lens of P3′s. Traffic-revenue studies are currently under way for I-70. Several years ago, Parsons Transportation submitted an unsolicited proposal to create a third bore at the Eisenhower Memorial Tunnel Complex and otherwise expand the road in a $3 billion to $4 billion project.

C-DOT has an annual budget of $1.2 billion for all highways in Colorado.

Three other projects are being considered for P3s. In the southwestern Denver metropolitan area, traffic and revenue potential for C-470 have been examined, “but it doesn’t necessarily look like it will support a P3,” says Ford.

However, reconfiguration of I-70 eastward from the intersection with I-25, called the “mousetrap,” remains a candidate for a P3, although just exactly what that new plan might look like remains somewhat undecided.

C-DOT is looking at expansion of I-25 north of Denver in two segments: 120th avenue to the Erie exit (Highway 7), and then northward from Highway 7.

Jones says that there are trade-offs in P3 contracts to which the public should be made aware. In the case of U.S. 36, he says, it became apparent later that had the public realized the funding gap, other mechanisms to bridge it might have been considered. “We would have found more money up front to put into the deal to alleviate C-DOT’s concerns about the toll revenue coming in below projections,” he said.

Other provisions of the bill would also help steer more money toward mass transit. “I just think that with our population (in Colorado) projected to double by 2050, we had better get our mass transit together or we will have big problems.”

Co-sponsoring the bill are two other Democrats, Rep. Mike Foote, of Lafayette, and Rep. Tracy Kraft-Tharp, of Arvada, and one Republican, Sen. Bernie Herpin, of Colorado Springs.

To read the bill in its entirety, click here

A separate bill submitted by Jones would expand the number of cars entitled to use the high-occupancy lanes in Colorado because they use alternative fuels. The program is currently capped at 2,000 vehicles, and the bill would increase it to 6,000 vehicles.

Jones say it would encourage more rapid adoption of alternatives, although transportation authorities fret that too many vehicles given access will clog the express lanes, reducing the speed of buses. To read that bill, click here.

Also: See new report about managed toll lanes by the Southwest Energy Efficiency  Project.

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