Virginia adopts revised $13.2 billion transportation program, accepts P3 reforms

Richmond, Va. — The Commonwealth Transportation Board (CTB) adjusted the FY 2015-2020 Six-Year Improvement Program in part to identify a group of projects that will be scored under House Bill 2. The new law requires projects to be scored using a consistent and objective analysis. Once the projects are scored, the CTB then selects projects for funding.

“The CTB adjusted the program following a series of nine public hearings across the state,” said Transportation Secretary Aubrey Layne. “The board will continue its aggressive effort to get input from local officials and citizens on the scoring process so the CTB has the knowledge it needs to assess and select the right projects for funding. As directed by Governor Terry McAuliffe, the board is engaging the public in assessing transportation needs to make the best and most prudent use of tax dollars.”

The funding on more than 60 projects in the revised six-year program has been reduced and the projects are flagged for scoring. Future funding on these projects, totaling $416 million, has been set aside. The projects meet the criteria for scoring under House Bill 2 because they were not fully funded or environmental studies were not complete. Enough funding remains on these projects to bring them to a logical stopping point. These projects, along with other candidate projects, will be scored before additional funding will be provided to advance them.

Projects that are exempt from the scoring process include pavement and bridge rehabilitation projects, revenue sharing projects, projects funded through the Northern Virginia and Hampton Roads regional revenues, certain federal funding categories and improvements funded through secondary and urban formula funds.

Currently the scoring process and how it will be administered is being developed. The CTB will use the process to select projects by July 2016.

The six-year improvement program allocates funding to a wide range of projects, including road, bridges, sidewalks, bike paths, rail and transit improvements across the state over a period of six years. The program is updated every year and approved by the CTB to reflect the latest priorities and revenue forecast.

Final Revised FY 2015-2020 Six-Year Improvement Program Breakdown:

• $10 million – highway construction
• $3.2 million – rail and public transportation
• $13.2 billion – total

PPTA Act reforms

The Commonwealth Transportation Board (CTB) also approved reforms to increase transparency and competition and to better evaluate the public’s risk for transportation projects delivered under the Public Private Transportation Act (PPTA), also known as the P3 process. The reforms are outlined in new guidelines following a six-month long public outreach effort that resulted in suggestions for improvements from more than 100 individuals, companies and organizations.

“The McAuliffe administration is committed to an open and competitive P3 process that delivers essential transportation projects by maximizing private sector investment and innovation,” said Transportation Secretary Aubrey Layne. “While a valuable tool to deliver certain projects, the P3 process had to be reformed to draw clear lines of accountability, strengthen competition, increase transparency and public engagement and minimize the risk to taxpayers. Over the last several months, the Virginia Office of Public-Private Partnerships (VAP3) conducted a public review of the P3 guidelines and incorporated many suggestions, including increasing the role of the CTB.  The Virginia Department of Transportation (VDOT) also developed better ways to assess risk with P3 and design-build projects, so taxpayers’ best interests are protected.”

P3 reforms include:

1) Engaging decision makers and increasing transparency:

• Involve CTB members and lawmakers (chairmen of the House and Senate Transportation Committees) as members of PPTA Steering Committees, which independently review potential P3 projects.
• Provide reviews at critical project milestones with the CTB; the board will take a more active role throughout the life of a P3 project.
• Inform legislators on the proposals early in the process and during critical phases.
• Engage the public at every stage of the P3 process.

2) Increasing competition:

• Score P3 candidate projects under House Bill 2 to determine the value and need of transportation improvements.
• Move unsolicited proposals into a standard competitive process.
• Maximize competition; should only one proposal be received during the Request for Proposals, the commonwealth will conduct a full value assessment of the proposal to determine if best value for taxpayers remains.

3) Minimizing risk:

• Identify project risks early in the P3 process; and continue assessing risk throughout the P3 project development and procurement stages with briefings to the CTB at critical project milestones.
• Establish the P3 project’s scope and risk profile; this information – Findings of Public Interest – will be made public at critical stages in a P3 project’s development.
• Restart the procurement process if there are significant changes to project scope, size or complexity.

Additional details and the draft 2014 PPTA Manual are posted on www.vappta.org.