Image courtesy FreeFoto.com
Remember the headline to my March 12, 2012 blog post about the Monroe Connector Bypass (or just the Monroe Bypass, for short)?
It suggested that the legal saga surrounding the proposed $725 million highway construction project was nearing “the end of the road.”
On second thought, not so much.
The road has taken an unexpectedly sharp turn, and there’s no telling how long the project may now be delayed. Why? Because according to the Fourth Circuit Court of Appeals (“4th Circuit”) in its May 3, 2012 decision in N.C. Wildlife Federation v. N.C. Department of Transportation, the North Carolina Department of Transportation (“NCDOT”) and the Federal Highway Administration (“FHA”) (collectively, the “Agencies”) failed to conduct a clear, transparent environmental review process that permitted meaningful public comment under applicable principles of federal environmental law.
Image from ncdot.gov
Oral arguments are set to take place before the Fourth Circuit Court of Appeals in Richmond, Virginia on March 20, 2012 in connection with an appeal asserted by several environmental groups seeking to stall construction of the Monroe Connector Bypass (commonly known as the “Monroe Bypass”) in Union County. If the Fourth Circuit rejects the appeal and allows the project to move forward, a groundbreaking is expected in August of this year, as reported late last week by the Charlotte Observer.
A couple of my blog posts have mentioned the use of public-private partnerships (“PPPs”) as an alternative source of highway construction financing, including my February 6, 2012 story about NCDOT’s plans to widen I-95 (by the way, last Friday, the Federal Highway Administration gave tentative approval to tolling on I-95).
It remains unclear whether any private money might be utilized to finance the I-95 widening project. What is clear is that PPPs present a host of legal issues that all project participants (and their attorneys) would need to wrestle with should the NCDOT seek private money for I-95, or any other state highway project.
The purpose of this blawg post is to supply three resources for enhancing our collective understanding of the practical implications of PPP financing. A good place to start is this blog post from the blawg “Best Practices Construction Law,” authored by attorney Matthew J. DeVries, who practices in Virginia and Tennessee. Mr. DeVries links to the second resource you should consider, and that’s the AGC’s White Paper on Public-Private Partnerships. Contractors may want to jump to page 13 of the White Paper, which includes a chart summarizing how a PPP could shift typical risk allocations:
For additional depth, consult the National Cooperative Highway Research Program’s Major Legal Issues for Highway Public-Private Partnerships. It presents several representative case studies and concludes that several successful projects have given PPP participants the flexibility to select the optimal project delivery system for their particular project. Such flexibility, of course, could mean procurement outside the sealed bid process.
I’ll be keeping an eye on subsequent I-95 developments. Should the NCDOT begin exploring PPPs, it is hoped that these three resources will provide the contracting community with a foundation for understanding the legal ramifications of this alternative highway financing framework.
Sorry for the prolonged absence during an inordinately busy time — two arbitrations in the last month. My upcoming schedule is far less robust, so I plan on getting back into the blogging swing full-force in the days and weeks ahead.
Before delving back into more heady fare, I thought I would feature this incredible design for a nature reserve observation tower in the Netherlands. Designed by architects from UNStudio in Amsterdam, the project is no doubt visually stunning, and will arguably represent a significant engineering achievement — assuming, of course, that the “Ultra High Performance Concrete” at the heart of the design works. Otherwise, and for the sake of the general contractor who ultimately builds the tower, I hope Dutch law recognizes a Spearin-doctrine equivalent!
Image: UNStudio. Click image for full gallery and project description by UNStudio.