DALLAS — Virginia's Commonwealth Transportation Board on Wednesday
The regulatory reforms include creation of a steering panel of board members and key legislators that will review P3 projects when they are proposed. The transportation board will take a more active role in overseeing a P3 project throughout its lifetime, including assessing its progress at key milestones.
Transportation Secretary Aubrey Layne and the board in May asked the Virginia Office of Public Private Partnerships to review its P3 implementation manual and guidelines. The proposed reforms were outlined to the CTB at its October meeting.
The changes were requested after the state spent more than $400 million on the controversial $1.4 billion Commonwealth Connector P3 project before it received environmental clearance.
If the revised regulations had been in effect in 2012, then-Gov. Bob McDonnell could not have awarded the design-build contract for the Commonwealth Connector, he said. Layne halted further spending on the project just days after he assumed office in January.
Layne said he and Gov. Terry McAuliffe are "committed to an open and competitive P3 process that delivers essential transportation projects by maximizing private sector investment and innovation."
"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," he said.
Layne said the Virginia Department of Transportation also developed better ways to assess the risk to the state from P3s and design-build projects.
The changes to the P3 rules that were adopted in 2012 will provide better evaluations of the public's risk for transportation projects delivered under Virginia's Public Private Transportation Act of 1995, Layne said. The state's first P3 manual was developed in 2005.
The reformed P3 rules will also increase transparency and competition in the process for selecting a private partner for a project, Layne said.
If only one bid is received, the state P3 agency will reevaluate the project to see if it should be re-bid, built as a conventional state project, or deferred. If there are significant changes to a project's scope, cost, or complexity, the selection process will be restarted.
Lawmakers will be involved early in the P3 evaluation and selection process with a steering panel that will include the chairmen of the General Assembly's House and Senate transportation committees as well as CTB members.
Legislators and the public will be notified of a project's progress from start to finish, with any potential risks identified early in the process and highlighted at critical phases throughout its span, Layne said.
Transportation board members will take a more active role, with regular briefings and updates on all P3 and design-build projects, he said.
The CTB, on Wednesday, also endorsed an updated six-year capital improvement program that provides $10 billion for highway upgrades and $3.2 billion for rail and public transit through fiscal 2020.
The board flagged for possible reduced funding 60 projects that have not advanced past the environmental review stage. The new plan sets aside $416 million that had been earmarked for the projects, leaving just enough to take them to a logical stopping point until a final funding decision is made.
The 60 projects will be scored in a process outlined in state law adopted earlier this year before any additional funding will be provided. The CTB must decide whether to go ahead with the targeted projects by July 2016.
"The board is engaging the public in assessing transportation needs to make the best and most prudent use of tax dollars," Layne said.
