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Federal Highway Administration / Publications / Focus / September 1997

Accelerating Infrastructure Innovations

Publication Number: FHWA-SA-97-027
Date: September 1997

Privatizing a Road Weather Information System: Lessons Learned in Minnesota

Finding an industry partner to construct and operate Minnesota's road weather information system (RWIS) has proven more difficult than expected, but the Minnesota Department of Transportation (DOT) hasn't given up on the idea of privatizing its RWIS network.

The plan to privatize the RWIS network was conceived in 1995, when Minnesota DOT decided to expand its 16 RWIS stations clustered in the Duluth and Twin Cities areas into a statewide network. The DOT also wanted data from the RWIS stations to be available not only to maintenance crews anywhere in the State, but to travelers as well. Staff from the maintenance, traveler information, and intelligent transportation systems divisions at Minnesota DOT determined that the best way to build a fully integrated, statewide RWIS network and to distribute RWIS data was to bring in the private sector.

Under Minnesota DOT's plan, a private company, or team of companies, would build and operate a statewide RWIS network and supply pavement and weather data to the highway agency. In exchange, the company would have exclusive rights to sell the information provided by the RWIS network to travelers, news organizations, farmers, the construction industry, and any other buyer over the life of the contract.

"We wanted to get the true value of the information," says Mark Wikelius of the DOT's maintenance department. "It's not Minnesota DOT's role to collect data and disseminate information, especially to nontransportation users. We don't have the ability or expertise to capture the value. There is a lot of interest among private industry in the dissemination of RWIS information, but not much interest in data collection. We asked, could private industry develop a business that would not only disseminate RWIS information, but also build and operate the RWIS infrastructure as well?"

In 1996, Minnesota DOT issued a request for proposals for partners (RFPP), asking bidders to propose a menu of services. The DOT had to start from scratch. "As far as we know, we were the first State to consider privatization," says Wikelius.

Two teams of companies and several individual vendors responded with proposals. The proposals included business plans detailing the products and services the companies could provide using RWIS data, as well as the level of investment needed from the companies and from Minnesota DOT to build the statewide RWIS network.

In January 1997, Minnesota entered into negotiations with one of the bidding teams. Those negotiations came to an end in August, primarily because of a lack of information about the actual market value of RWIS data.

"There's a market perception that there's a lot of free weather information available," says Wikelius. "However, information from an RWIS is much more comprehensive than the weather information that is currently available. Because the information RWIS provides isn't available yet, nobody realizes what it's worth." Wikelius predicts that this outlook will change as more States begin providing motorists with travel information from RWIS networks.

For now, Minnesota is putting its plans for privatizing the RWIS network on hold. "The main goal now is to get the system running as soon as possible, so Minnesota will build the infrastructure and disseminate the RWIS data to DOT crews," says Judy Rockvam of Minnesota DOT. "However, the system could still be privatized in the future."

The State plans to issue an RFPP for companies interested in gaining access to the RWIS data and then repackaging it for travelers and others outside Minnesota DOT.

Wikelius says Minnesota's progress has been followed closely by many States. For other States considering privatizing their RWIS network, he has a few suggestions. "Work with industry early, and define each entity's role in the development as clearly as possible," he says. "I also think the question about the unknown market potential needs to be answered somehow. But I wouldn't give up."

Rick Nelson of Nevada DOT, head of the Lead States team for anti-icing/RWIS, predicts that it's only a matter of time before another State considers privatizing its RWIS network. "There's tremendous demand for this information," he says. "Privatization will come to pass. I have faith in that."

For more information, contact Mark Wikelius at Minnesota DOT (phone: 612-296-1103; fax: 612-297-7576; email: mark.wikelius@dot.state.mn.us).

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