| Location |
Northern Metropolitan Boston , Massachusetts |
| PPP Option |
BOT/DBOM, with tax exempt 63-20 financing |
| Mode |
Highway |
| Description |
Route 3 North is an existing 21-mile limited access highway running north and south between the Route I-95/128 circumferential highway around Boston and the New Hampshire border. The $385 million project is designed to alleviate a number of significant transportation problems on this heavily utilized highway. The project involves:
- The addition of a third travel lane in each direction
- Creation of median shoulder and a 30-foot clear zone
- Improvements to 13 interchanges
- Replacement of 40 bridges
As of October 2004 three travel lanes were open in each direction on the full 21-mile length of the highway. Additional work on roadway overpasses and interchanges will continue into the Spring of 2005.
In 1999 the Commonwealth of Massachusetts approved special legislation to develop the Route 3 project on a PPP basis. The legislation enabled the creation of a special purpose, not-for-profit 63-20 corporation which would use lease payments pledged by MassHighways to issue bonds. Following the award of the Route 3 procurement to Modern Continental, the legislature established the Route 3 North Transportation Improvements Association. The Association is overseen by a three person board, with the Massachusetts Secretary of Transportation of the Commonwealth of Massachusetts serving as its chairman. The other two positions are filled by the Secretary of Administration of Finance and a designated member representing Modern Continental.
Modern Continental was responsible for arranging the placement of the bond and retained the services of Salomon Smith Barney and Mintz-Levin to do so on behalf of the Route 3 North Transportation Improvements Association. The Association issued $394.5 million in tax-exempt lease revenue bonds to finance the project on the Commonwealth's behalf. The bonds are secured by a 30-year lease between MassHighway and Route 3 North Transportation Improvements Association. The Commonwealth also made interest payments during the four year construction period. MassHighway's rent payments are made through an annual appropriation and cover debt service and the cost of operations and maintenance. |
| Sponsor |
Massachusetts Highway Department (MassHighway) and the Massachusetts Executive Office of Transportation
|
| Cost |
$385.1 million |
| Type of Finance |
Tax fee revenue bonds issued by 63-20 public benefit corporation.
|
| Revenue Sources |
Lease Payments through an annual appropriation by the state legislature. |
| Project Delivery / Contract Method |
Design-Build-Operate contract. Best value award.
|
| Private DBO Partner |
Modern Continental
As of the fall of 2004, Modern Continental was negotiating a merger with Jay Cashman Inc. The effects of that possible merger on the Route 3 North project are not yet known |
| Private Investor Partner |
Bond holders
|
| Project Advisors |
Salomon Smith Barney, Hinckley, Allen & Snyder, Mintz-Levin |
| Design - Build Contractor |
Modern Continental Construction Company |
| Project Engineer |
URS |
| Lenders |
Bondholders |
| Project Status |
21 mile, 3 x 3 lane highway was fully opened in October 2004. Overpass and interchange work will extend into the spring of 2004.
Modern Continental is currently negotiating a merger with Jay Cashman Inc. The effects of that possible merger on the Route 3 North project are not yet known. |
| Financial Status |
Closed
|
| Innovations |
The developer may generate non-project revenues through ancillary development in the corridor. The developer also shares in the sale of fiber optic rights and the sublease of a service plaza.
Design-build-operating procurement approach cut delivery time by approximately (?)of the initial 12 year estimate. This is Massachusetts ’ first design-build highway project.
The requirement of the developer to operate and maintain the road for a 30 (?) period and then transfer it to MassHighways. This provided strong incentives for quality assurance, and incentives to capitalize on asset management practices to identify an efficient and cost effective maintenance program. |
| Related Links / Articles |
Project website
IFQ Article
|
| Contacts |
Mr. Jack McDonnald
MassHighways
617-973-7584
John.mcdonnell@state.ma.us
John Pastori
Modern Continental Companies
600 Memorial Drive
Cambridge , MA 02139
Tel: 617-864-6300
|
