Business and finance
New procurement approach picked for Knik Arm
The Knik Arm Crossing Project will now be delivered as an availability payment public-private partnership (P3) under a new procurement process. The Knik Arm Bridge & Toll Authority (KABATA) has also announced the cancellation of the previous procurement, which was under a revenue risk transfer P3 concession.
The Knik Arm Crossing is a planned toll bridge and associated road crossing Cook Inlet between Anchorage – the largest city in Alaska - and the borough of Matanuska-Susitna, which is one of the fastest-growing counties in the USA.
“After careful consideration, we determined to re-initiate the procurement process to expedite project delivery, finance this essential toll bridge project under a life-cycle oriented operations and maintenance structure, and provide the best value for the state of Alaska,” said KABATA chairman Michael Foster.
Under the availability payment P3 model, the partner selected through the procurement process will receive periodic payments based on the availability of the project at specified performance levels. Underachievement would result in reductions to the periodic amount paid.
“I am confident that the revised procurement process is the right path to deliver the Knik Arm Crossing Project” said KABATA executive director Andrew Niemiec.
The project has now received a record of decision to build from the Federal Highway Administration. “This decision, along with right-of-way acquisition and securing key permits, provides more certainty for a successful procurement,” said Niemiec.