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P3 Digest, October 17, 2017

Maryland Governor Announces Ambitious Three-Highway Expansion

Maryland Gov. Larry Hogan announced plans to widen three of the state’s most congested roadways in what he called the largest set of P3 highway projects in North America.

The governor’s $9 billion “Traffic Relief Plan” would add four toll lanes to Maryland’s portion of Interstate 495, also known as the Capital Beltway, and Interstate 270 from the Beltway to Frederick, according to the Washington Post.

The plan also calls for the addition of four toll lanes to the Baltimore-Washington Parkway (MD 295), provided the federal government allows the state to take ownership of the parkway. Hogan said the U.S. Department of Interior is eager to divest itself of the road, which is managed by the National Park Service. However, the agency issued a statement after Hogan met with Interior Secretary Ryan Zinke saying that the two had not reached a final decision over the parkway’s future ownership.

The governor’s plan calls for a private developer to design, build, finance, operate and maintain the I-270 and I-495 lanes at a cost of $7.6 billion, reported City Lab. Revenue from these P3s would be used to cover the $1.4 billion cost of expanding  and maintaining the Baltimore-Washington Parkway, which would be conducted by the Maryland Transportation Authority. Thus, Hogan said, the three projects would pay for themselves.

The projects would go a long way toward alleviating traffic congestion in Maryland, which has the second-longest commuting times nationwide at a statewide cost of $2 billion in 2015, the governor said in a Sept. 21 press release announcing the plan. More than 98 percent of this cost is attributed to traffic in the Baltimore/Washington region.

No timetable was offered for the beginning of construction. Maryland Transportation Secretary Pete Rahn said the initial phase of requesting and reviewing developers’ qualifications before preparing a request for proposals typically takes up to 18 months.

Trump Appears to Back Away from Using P3s to Fund Infrastructure Projects

After campaigning on a pledge to encourage the use of P3s to rehabilitate the nation’s crumbling infrastructure — a proposal he repeated in a budget rollout in May and a speech in June — President Trump recently told lawmakers he was no longer interested in pursuing this procurement approach.

During a Sept. 26 discussion with members of the House Ways and Means Committee about potential changes to the tax code, Trump said P3s are “more trouble than they’re worth,” said Rep. Brian Higgins (D-N.Y.). He instead has decided states and localities should bear most of the costs for these projects, reported the Wall Street Journal (paywall).

Trump also has said the administration would use direct federal spending, in the form of new tax revenue or the assumption of additional debt, to help pay for new infrastructure projects.  But he wants to limit federal spending on his $1 trillion initiative to $200 billion.

White House officials and legislators from both parties have proposed inducing multinational corporations to repatriate about $2 trillion in overseas profits at a discounted tax rate and using them to pay for infrastructure projects. However, a tax plan the Republicans have unveiled that would impose a 10 percent tax on these earnings, representing $200 billion in revenue, did not tie the funds to infrastructure, the Journal reported.

Trump’s changing position could open the door for Democrats to work with his administration on infrastructure. Senate Minority Leader Chuck Schumer (D-N.Y.) is against relying on fees and tolls to pay for these types of projects and favors direct federal spending to support them.

P3Connect Moved to January in Miami Beach

P3Connect, which had been scheduled for October, was rescheduled due to the need for Florida to recover from the effects of Hurricane Irma. The event will be held January 22-24, 2018, at its originally planned location, the Confidante Miami Beach, and the program remains unchanged.

Join us to explore how the nation’s growing need to preserve and improve its infrastructure systems is altering the P3 landscape and what challenges and opportunities exist, all through the eyes of thought leaders who will help to chart the road ahead. For more information and to register, visit the P3Connect website.

University of Florida Offers P3 Course

The University of Florida’s Public Utility Research Center (PURC) has announced the launch of a P3 foundation-level training course. It is intended to standardize knowledge of the P3 process and terminology.

PURC, which is in the university’s Warrington College of Business, is the first academic institution in the United States to become an Accredited Training Organization of the APMG International’s P3 Certification Program. This is the initial course of the Certified P3 Professional program promoted by the World Bank and other multilateral development banks; it is managed by APMG International and the certification it confers is the only globally recognized P3 credential.

The APMG P3 Certification Program is an innovation of the Asian Development Bank, the European Bank for Reconstruction and Development, the Inter-American Development Bank, the Islamic Development Bank, the Multilateral Investment Fund and the World Bank Group.

Early bird registration discounts are available through Oct. 27. More information is available at http://warrington.ufl.edu/centers/purc/training/p3-certification.asp

SAME to Hold Small Business Conference in November

The Society of American Military Engineers (SAME) will hold its federal Small Business Conference for the architect/engineer/contractor industry on Nov. 15-17 in Pittsburgh, Pa. This event will provide small businesses the opportunity to connect with representatives from 10 federal agencies, including the U.S. Army Corps of Engineers, the Department of State, the Department of Energy, the General Services Administration and the Small Business Administration.

The conference will feature keynote speakers Isaac Lidsky, best-selling author and CEO of ODC Construction, and James Galvin, acting director of the Office of Small Business Programs for the Department of Defense.

Conference highlights include more than 20 hours of tailored education sessions, topic-focused business opportunity briefings and an exhibit hall with more than 300 exhibitors.

For more information and to register, visit the conference website.



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