New Federal programs and tools designed to encourage private sector involvement in delivery of highway projects have been largely successful. However, P3 projects benefitting from these measures must be developed in compliance with the same Federal regulatory requirements and processes as any other project. In some cases, states and private developers have found that federal processes may present challenges that do not support some of the approaches or efficiencies contemplated in a P3 delivery. Special Experimental Project 15 (SEP-15) offers states an opportunity to work with FHWA to explore whether exceptions from or changes to existing policies or procedures within FHWA's purview may be warranted.
SEP-15 applications may include suggested changes to FHWA's traditional project approval procedures and may require some modifications in the implementation of FHWA policy. Experiments generally fall into four major categories: contracting; environmental compliance; right-of-way acquisition; and project finance. One such experiment was conducted shortly after Congress amended the TIFIA statute to make refinancing of existing debt eligible for TIFIA credit assistance. That was at about the same time the Virginia DOT (VDOT) was negotiating the refinancing of the Pocahontas Parkway project and the transferring of the facility operation under a toll concession agreement. Although refinancing had been authorized in statute, the policy that would govern this activity had not been written. As such, VDOT applied through the Virginia FHWA Division Office to conduct an experiment to evaluate a refinancing of existing project debt through TIFIA. Following financial close of the transaction, VDOT submitted a report to FHWA on the findings and benefits of the experiment as required by the SEP-15 process.