P3 Solution for Pennsylvania Bridge Repairs Must Wait for Transportation Plan To Pass

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Bryan Kendro, director of the Office of Policy and Public Private Partnerships for the Pennsylvania Department of Transportation (PennDOT), told InfraAmericas that repair of many of the state’s bridges could be structured as public-private partnerships (P3) under Pennsylvania’s new P3 Guidelines. But PennDOT will hold off proceeding with any bridge repair P3 project until Governor Tom Corbett’s 2013 Transportation Plan (the Plan) has been approved by the General Assembly.

The Plan, released on February 5, 2013, allows for gradually increased spending on transportation over the next five years—$510 million in additional transportation spending in 2013, and $1.8 billion by 2018. Governor Corbett released the Plan as part of his state budget.

The Plan would finance this increased spending through a phase-out of the artificial cap on wholesale gas that currently limits taxation to the first $1.25 per gallon of the wholesale price. The cap would be reduced in July 2013 and 2015 and removed entirely in July 2017. The Plan also calls for 1-cent reductions in the flat gasoline taxes paid directly by motorists. These reductions would take place on July 1, 2013, and July 1, 2014.

The Plan provides for increased spending on all elements of transportation throughout the Commonwealth, including roads and bridges, transit, safety programs, and multimodal projects. First-year funding for the Plan is estimated to provide:

  • $40 million for transit
  • $80 million for locally owned roads and bridges
  • $60 million for a multimodal fund
  • $30 million for expansion projects for the Pennsylvania Turnpike Commission
  • $300 million for Commonwealth-maintained roads and bridges

Despite its increased level of spending, the Plan is still well below the $2.5 billion in new annual funding recommended by Governor Corbett’s Transportation Funding Advisory Commission in 2011. 

Attorneys in Ballard Spahr’s P3/Infrastructure and Public Finance Groups will continue to monitor and report on new developments in transportation financing and public-private partnerships in Pennsylvania and other states. If you have questions on infrastructure financing or public-private partnerships, please contact Brian Walsh at 215.864.8510 or walsh@ballardspahr.com or Steve T. Park at 215.864.8533 or parks@ballardspahr.com, or the member of either Group with whom you work.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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