The solution enables the project to proceed despite ODOT’s US$1.6 billion budget hole.
Ohio Department of Transportation’s use of the P3 option will allow contractors to finance more than US$300 million needed to design and construct the second major phase of the project in downtown Cleveland (ODOT). ODOT will then pay the contractor back with payments over a fixed period.
“This is going to give a lot of prosperity to Cleveland," said governor John Kasich. "Cleveland is on the move. It is rebuilding. We have to move people and things. If we think outside the box and have the courage to change, which is important for Ohio, we can continue to do very well.”
Ohio enacted legislation last year permitting ODOT to pursue P3s. This is the first time ODOT will pursue a P3.
Earlier this year, ODOT launched the Division of Innovative Delivery to explore P3s to expedite the construction of some of the state’s largest construction projects. The Brent Spence Bridge in Cincinnati may also be built using the approach.
The division is also exploring options to unlock the revenue potential of the Ohio Turnpike and non-interstate rest areas, in addition to developing a programme to generate millions of dollars for the sponsorship and naming rights of certain state-owned assets such as bridges, interchanges and sections of highway.
In January, ODOT announced a $1.6 billion budget hole that forced the department to push back by decades some of the state’s largest construction projects, including the Innerbelt Bridge. Since then, the agency has initiated a complete review of all current and future transportation projects to identify those that could be candidates for P3s, and has sought to identify additional sources of revenue to aid in the funding of major transportation projects throughout the state.
