The Major Bridge P3 (MBP3) presented to the Pennsylvania P3 Board in November 2020 contemplated the replacement or rehabilitation of major interstate bridges through a progressive P3 delivery model under which PennDOT and a development entity would enter into a Pre-Development Agreement (PDA). The PDA focused on nine interstate bridges to be packaged for delivery through one or more Design-Build, Finance and Maintain (DBFM) agreements.
Of the nine bridges, six bridges were identified for Package 1:
PennDOT terminated the PDA for Package 2 on June 6, 2023. The process to allocate funding on the 12-year program to allow the I-83 South Bridge project to advance through the environmental, design and construction phases of the project has been initiated. To expedite this critical project, the department continues to seek Federal Discretionary funding so the project can be delivered earlier.
The project scopes and available funding for the remaining two bridges are being reviewed as part of our 2025 12-Year Program Update to determine a path forward:
When the MBP3 was approved, PennDOT planned to make annual payments to pay for the work and financing costs on these bridges using mandatory tolling, as was permitted by the Pennsylvania P3 law at the time. Since that time, Act 84 of 2022 amended the P3 law to eliminate mandatory tolling of existing free lanes. In August 2022, PennDOT chose to move the bridge projects in the MBP3 forward without tolling and pay for the project(s) using existing funds to make annual payments to the development entity.
PennDOT reached financial close on the six bridges in Package 1 – meaning the terms and conditions relative to the financing of the project were finalized – in December 2022.
Bridging Pennsylvania Partners LLC (BPP) was selected to deliver the Major Bridge P3 Program and formed the Development Entity, Bridging Pennsylvania Developer 1, LLC (BPD1) to deliver the first six bridges in the Program (Package One). Bridging Pennsylvania Partners (BPP) is led jointly by Macquarie Capital and Shikun & Binui as Lead Project Developer and Equity Members. Macquarie Capital and Shikun & Binui are international leaders in developing and delivering successful P3 projects.
The BPD joint venture (JV) consortium includes the design & construction expertise of FCC Construction Inc. (FCC) and S&B USA Concessions (SBA), based in Pittsburgh, Pennsylvania, who builds complex infrastructure projects and specializes in P3 and Design-Build projects. SBA is the construction arm of Shikun & Binui Ltd in the US, and is also the parent company of Joseph B. Fay, a subcontractor for this project. MBP3 was designed to make sure there were plenty of opportunities for Pennsylvania companies to share in the work done on the project. Other subcontractors include H&K Group, Inc., Kokosing Construction Company, Michael Baker International, SAI Consulting Engineers, and Wagman.
The six bridges in Package 1 will be delivered via the MBP3 and are currently in the final design phase or getting underway.
I-83 South Bridge was removed from the PDA on March 21, 2023. PennDOT terminated the PDA for Package 2 on June 6, 2023.
Overall estimated design and construction costs are approximately $1.5 billion for Package 1, prior to financing. On January 12, 2023, the Department paid the development entity a Mobilization Payment of $90,000,000 to account for costs of mobilization, related costs and to purchase materials.
Future payment to the development entity include the following:
- A Milestone Payment - The Department has agreed to pay the development entity a Milestone Payment equal to $50,000,000 when the Borrower completes 65% of the Design & Construction Work, but no earlier than September 1, 2027.
- Availability Payments – The Department agreed to make future availability payments to the development entity, annually, over a 35-year period. These payments will start with a partial payment (not a full year) in FY 2028 estimated at $48.0 million (when construction will be complete on all six bridges). In FY 2029, an estimated payment of $143.8 million will be paid to reflect the first full year's payment. From that point on, payments will change throughout the 35-year period based on the Consumer Price Index (CPI), reaching an estimated $177.7 million in FY 2063. The estimated final payment in FY 2064 is estimated to be $26.6 million.
Availability payments are regularly recurring, annual payments made to the development entity once construction of the bridges is complete. Availability payments are analogous to recurring mortgage payments.
The availability payment will be funded using a mix of state and federal dollars.
Construction is expected to take place from Summer 2023 through Summer 2028 with the first bridge to be completed Fall 2027. The first bridge to go into construction will be I-81 Susquehanna in Summer 2023.
|Bridge||Anticipated Construction Start||Anticipated Bridge Completion|
|I-81 Susquehanna||July 2023||Summer 2028|
|I-80 Nescopeck||Spring 2024||Fall 2027|
|I-78 Lenhartsville||Spring 2024||Summer 2028|
|I-80 Lehigh River||Spring 2024||Spring 2028|
|I-80 Canoe Creek||Fall 2023||Fall 2027|
|I-80 North Fork||Spring 2024||Summer 2028|