INDIANAPOLIS (AP) — A group of partners who propose building a new Ohio River bridge between Indiana and Kentucky for $763 million, nearly 25 percent below previous cost estimates, won a state panel's endorsement Friday for Indiana's portion of a sweeping two-state bridges project.
After a brief presentation, the Indiana Finance Authority granted preliminary approval to a bid submitted by WVB East End Partners, a team that includes Walsh Investors, VINCI Concessions and Bilfinger Berger and 21 other entities.
Three other firms also submitted bids for the bridge that will link Utica, Ind., and Prospect, Ky., and is a key part of the two states' $2.6 billion project to erect two new Ohio River bridges, upgrade a third and improve highway interchanges in the traffic-congested Louisville, Ky., area. Motorists will pay tolls to use all three of the bridges.
Construction of the so-called East End bridge that Indiana is overseeing will complete an interstate loop around the Louisville metropolitan area by linking Indiana 265 and Kentucky 841 over the river.
Indiana Gov. Mitch Daniels said that bridge will help relieve traffic congestion in both states and spur development in southern Indiana. He said developers are already expressing interest in the region around the bridge's Indiana side, which is a few miles upstream from Louisville north of the river.
"There isn't any question it's going to spark a lot of new investment and new jobs in an area of the state that I predict in 10 years we'll look at as one of our real stars," Daniels said. "We think this will be great for commuters and great for existing businesses on both sides."
A public hearing on WVB East End Partners' proposal will held Dec. 1 in Jeffersonville. The finance authority will then meet Dec. 3 to consider final approval of the proposal before it is reviewed by the Indiana Budget Committee. Daniels would then make the final decision on whether to proceed.
WVB East End Partners' proposal calls for the bridge to open by November 2016, about seven months ahead of the previous estimate. Its $763 million bid is 23 percent below the project's previous $987 million cost estimate, which doesn't include costs for land acquisition and relocating utilities.
On Thursday, Kentucky transportation officials gave tentative approval to Chicago firm Walsh Construction Co. — one of the partners in Indiana's proposal — to build a new bridge over the Ohio River between downtown Louisville and Jeffersonville, Ind., along Interstate 65. That project also includes a revamped Kennedy Bridge and reconstructed interchanges in downtown Louisville and Jeffersonville.
Walsh's bid included a projected completion date of December 2016 at a construction cost of $860 million.
Kentucky is financing its bridge projects through traditional bonding and will pay its contractor in full when that work is done, said Will Wingfield, a spokesman for the Indiana Department of Transportation.
In contrast, he said Indiana is using a public-private arrangement under which WVB East End Partners would line up its own financing for the Utica-to-Prospect bridge and receive annual payments from Indiana for 35 years after the bridge opens.
Those payments will cover the partners' expenses for the design, construction, maintenance and operation of the bridge, ensuring that it will be handed over to Indiana "in pristine condition," said Kendra York, Indiana's public finance director.
She said Indiana's payments to the partners would be up to $32.9 million a year and amount to about $1.15 billion over the 35 years they oversee the bridge.
Wingfield said Indiana and Kentucky will choose a private company to install and manage tolling on the bridges.
"Indiana and Kentucky are taking all of the revenue from all of the project bridges and dividing it exactly in half to help cover the costs," he said. "Indiana will use its share to repay the private company and Kentucky to repay its bonds," he said.