Bridges work moves forward

Clark County

So you know

• The Interstate 65-Spaghetti Junction corridor was rated as one of the nation’s worst bottlenecks in a report released by the American Transportation Research Institute. The ATRI and the Federal Highway Administration findings assess the level of truck-oriented congestion on the national highway system and ranked Spaghetti Junction at the Kennedy Bridge as the 11th worst in the nation. For more information on the report visit www.atri-online.org

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June 6, 2010

Authority seeks tolling answers from Federal Highway Administration

By BRADEN LAMMERS Braden.Lammers@newsandtribune.com The News and Tribune Sun Jun 06, 2010, 01:03 AM EDT

> SOUTHERN INDIANA — The Louisville and Southern Indiana Bridges Authority canceled its June public meeting, but it did not leave a hole in its schedule.

Steve Schultz, executive director of the authority, along with the authority’s board members, went on a site tour of the proposed $4.1 billion Ohio River Bridges Project on Thursday when its June public meeting was originally scheduled.

Site tour

The purpose of the tour, according to co-chairman of the bridges authority, Kerry Stemler, was to educate authority members on the complexity of the project and add clarity to the scope and breadth of the task as it stands.

Construction plans — as determined by a 2003 Federal Highway Administration Record of Decision — the bi-state authority is pursuing financing for include building an east-end bridge for Interstate 265 to cross the Ohio River, building a downtown bridge that will service I-65 and reconstructing Spaghetti Junction in Louisville.

“[It is] very important that all of the authority [members] understand the complexity of that project,” Stemler said. “This project touches a considerable amount of people in a tremendous area.”

The tour gave board members a more intrinsic frame of reference on the project and the time it has taken to get to where they are now, he said.

Strategic adviser

Another reason for the cancellation of the June board meeting is to allow the newly hired strategic adviser, KPMG LLP Infrastructure Advisory, to get caught up on the project’s details.

The New York-based audit, tax and advisory services company was hired last month to help determine a financing structure to pay for the project, as well as being tasked with examining cost projections and analyzing traffic and revenue studies.

“KPMG has gained a lot of traction in the last two meetings,” Schultz said.

In recent meetings, he said the company was given a detailed overview of the project, along with some of the company’s members conducting a partial site tour.

While the two groups are working together to gather information, it is still too far away to offer an idea on which strategy may be the most likely to finance the project.

“They will start with casting the net broadly,” Schultz said.

KPMG is expected to have outlines of a work plan that will help define the objectives of a strategic plan and present the outline at the authority’s next meeting, he said.

“The result [needs to be] a financial plan that looks good on paper, but is also financeable in the market,” he said.

But the objectives of the strategic plan will not be cemented that quickly.

“We will not have them defined by next meeting,” Schultz said.

In casting its wide net, KPMG will have a variety of funding options to investigate.

Funding possibilities

Options to secure federal funding are being mulled and while receiving federal money is a competitive process, Stemler believes the bridges authority is well-positioned. The advantage as he sees it is the status of the region as a vital logistical transportation location.

Former U.S. Department of Transportation Secretary Mary Peters and current Secretary Ray LaHood both understood the value of the project, Stemler said.

Despite the options available to help fund the project, the possibility of imposing tolls is one the board is still pursuing.

A letter addressed to Regina McElroy, director of the Office of Innovative Program Delivery for the Federal Highway Administration, asked the administration to outline how the authority might be allowed to impose tolls.

“We are also requesting consideration of the tolling authority for facilities outside the parameters of the project, including consideration of the possibility of tolling of the Sherman Minton Bridge ... and the Clark Memorial Bridge,” according to the letter. “Tolling these facilities in conjunction with any tolling of the Ohio River Bridges Project facilities is being considered because it would allow a more comprehensive and integrated approach to managing traffic congestion and compliance with air quality requirements in the metropolitan area.”

Although the letter asked the highway administration to help determine tolling possibilities, it is not a final determination that tolls would be imposed.

However, “the likelihood of some tolling ... there is a good chance,” Schultz said.

What was seemingly determined in the letter is that some form of noncash tolling would be used if tolls are implemented on any or all of the structures.

“Specific toll rates have not yet been established and all scenarios of toll-setting, including variable rate-setting, are currently under consideration,” according to the letter. “It is anticipated that a comprehensive tolling approach would be deployed and that it would include a system that varies tolls based on time of day and other factors to help manage congestion and air quality.

“It is also assumed that the tolling system will rely heavily, if not exclusively, on an all-electronic collection system.”

Timeline

A timeline for the highway administration to respond to the bridges authority is likely within a few months.

Despite the days and weeks it will take for KPMG to get fully briefed on the details of the bridges project and the waiting time for a response from the administration on possible tolling options, the goal of having a funding scenario in place by Dec. 31 is still on track, Schultz and Stemler said.

“We are going to be fleshing out a timeline with more milestones in the next few weeks,” Schultz said.

The next scheduled meeting for the bridges authority will be 10 a.m. July 1, with the location to be determined.