Image source: Indianapolis Star
The state of Indiana announced an agreement Friday to take control of construction of the 21-mile stretch of I-69 from Bloomington to Martinsville, a project that was originally a public-private partnership (P3).
The agreement terminates a contract with I-69 Development Partners, the private company responsible for designing and building I-69 Section 5 and maintaining it for 35 years. The move comes after multiple delays, much frustration for drivers in Bloomington and the near-insolvency of a key company involved in the project.
The agreement would settle all disputes and allow the Indiana Finance Authority to assume direct control of the project, which is about 60% finished. The project was supposed to be completed by October 2016, but has been delayed four times since construction started. The new estimated completion date is August 2018, nearly two years late.
According to state projections, taxpayers will actually save money, when 35 years of maintenance and finance costs are taken into consideration. Those issues were being handled by I-69 Development Partners, and would now be covered by the state.
State officials said Friday that in today’s dollars, the entire project, including maintenance costs, would cost $560 million. They say it would have cost $590 million with its now-former private partner.
The state negotiated a $50 million settlement payment from the company. As part of the termination agreement, I-69 Development Partners also will pay $12 million to the bondholders. Indiana expects to have a signed agreement by July 31.
Source: Indianapolis Star