As the environmental assessment phase drew to a close, private sector developers expressed initial interest in implementing the project on a public-private partnership (P3) basis. State legislation enacted in 2004 removed a significant impediment to FDOT's ability to use this project delivery method. At the same time, the active pursuit of a design-build-finance-operate-maintain P3 concession for the nearby Port of Miami Tunnel project generated additional interest in considering a similar approach for the I-595 project.
FDOT was receptive to the private sector's ideas for a P3 collaboration to deliver the I-595 project. Consistent with FDOT's own thinking, private developers encouraged FDOT to bundle the 16 separate improvement projects in a single procurement that could be built more quickly and efficiently. Delivering the entire project corridor at once would accelerate the delivery by approximately 15 years, generating the resulting mobility, connectivity, and safety benefits considerably sooner.
FDOT could have issued bonds to cover the shortfall in available federal funding needed to advance the full project, but this financing option would have required too great a share of the state's debt capacity. A P3 approach that included project financing arranged by the private partner would reduce the state's debt exposure and transfer the risks associated with project completion, construction cost overruns, and ongoing maintenance requirements to the private partner.
The viability of the P3 approach was also enhanced by Florida's Strategic Intermodal System (SIS), which was established in 2003 to support a designated set of projects critical to moving people and goods and enhancing economic competitiveness and quality of life in Florida. Funding for SIS projects came from newly dedicated documentary (doc) stamp collections, which are levied on documents that transfer ownership of real property in Florida.
In late 2005, the state announced a list of Growth Management projects proposed for SIS funding between fiscal years 2005-2006 and 2010-2011. The list included nine of the 16 I-595 corridor projects identified during preliminary engineering. Then in 2007, further legislative changes were made to encourage the use of P3s on SIS projects, I-595 among them. Initial funding provided by a private partner would be eligible for reimbursement from FDOT funds.
Just after this legislative change went into effect, FDOT hosted an industry forum in July 2007, soliciting feedback from would-be private partners on proposed technical and financial approaches. At this point, FDOT presented two P3 delivery options under consideration: a full design-build-finance-operate-maintain concession and a design-build-finance option in which the state would retain responsibility for the long-term upkeep of the facility. FDOT sought to gauge which option would generate the most interest from private partners and, hence, the most competition. A majority of potential bidders indicated a preference for the full concession approach.
To inform its decision on whether or not to pursue a full P3 concession on the I-595 project, FDOT completed a value for money (VfM) analysis in August 2007. This type of analysis generally compares two or more methods of project procurement to determine which one offers the best "value" to the state. The analysis considers the upfront construction and financing costs as well as long-term operations and maintenance, usually for a period of at least 30 years. In this case, FDOT compared the lifecycle costs of the full design-build-finance-operate-maintain concession with those of a design-build-finance option. The analysis indicated that the full concession option would deliver greater value to the state.