Citizens Transportation Coalition Naples, Fl. 239-254-0670
Concerned Citizens Addressing Critical Transportation Issues
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From CTC (Citizens Transportation Coalition)
State receives no bids for Alligator Alley lease by today's deadline
By LESLIE WILLIAMS Monday, May 18, 2009 Naples Daily News
One year later, the odyssey led by Florida transportation officials seeking to lease Alligator Alley is over as quietly as it started.
By the 4 p.m. deadline Monday, the Florida Department of Transportation had received no proposals from six teams of bidders who expressed interest in the project in 2008. That was after several delays, including one in January that put off the proposal deadline for an additional five months. It was pegged as an effort to allow credit markets to thaw and for teams to consolidate and share risk.
However, about 4:30 p.m. Monday, department officials released a statement that not one bid had been submitted.
Kevin Thibault, assistant FDOT secretary and the project’s head, said Monday evening he was surprised, but had prepared long ago for the unexpected.
“It’s something you can’t normally expect,” said Thibault. “You kind of plan that you will have a scenario where you don’t get any proposals.”
He said run-of-the-mill construction projects receive no bids, from time to time. It is a reality of the business, he said. That is not the case with any current projects, however.
“Each one is unique,” he said. “There will be different factors that will drive the proposers to put together their bids. Time could be a factor. It could be that, with some of them, the added time gave them the ability to change their minds.”
Thibault said he had no regrets about changing the timeline, however.
He said it is too early to speculate whether the state will pursue a lease of the Alley at another point in the future. Additionally, he said FDOT would have to hold discussions about whether to increase tolls starting in July, as planned. A toll schedule released in October called for tolls to go up to $3.75 for cash transactions from the current rate of $2.50, starting July 1 this year.
Bob Poole, an advocate for public-private partnerships, speculated early Monday that the number of bidders might narrow — to two or three.
“When you deal with a project that is based on voluntary usage ... there is some inherent risk in how many people paying how much are going to use a project like that,” said Poole, who is director of transportation studies for the Reason Foundation, a libertarian think-tank.
He pointed to recent brush fires that scoured 30,000 acres in the Big Cypress National Preserve, shutting down Alligator Alley intermittently for three weeks, meaning no tolls were collected while the road was out of use. Events like that remind investors of the risk inherent to leases of public transportation assets such as roads.
Moreover, said Poole, international credit markets have hardly thawed compared to January. Poole called it “increasingly difficult, but not impossible,” to secure the credit needed to lease a large piece of the transportation pie, from an airport in Chicago where a lease deal championed by Mayor Richard Daley fell through last year to a road in Chile, where the firm Global Via Infrastructure put down 40 percent equity to lease a road in 2008.
Global Via was originally partnered with the collapsed investment bank Lehman Brothers and was looking for a new partner to put up the capital needed to lease Alligator Alley. Unofficial estimates placed the lease price of the road at about $500 million for 50 years.
After news broke Monday that no bids had been received, state Senator Dave Aronberg was jubilant. He spent the past year speaking publicly against the proposal and introducing legislation that would block similar deals. However, it was to no avail during the recently-concluded legislative session.
“This deal was ill-conceived from the beginning,” said Aronberg. “It’s a shame that the taxpayers of Florida had to waste $3 million to get to the point where the state was turned away at the altar. The state shouldn’t have been at the altar to begin with.”
That $3 million Aronberg referred to is how much he says the state paid to litigate the deal and defend it from attacks that mounted over the 13 months it was pursued. The first public mention of a potential lease of the 78-mile toll road from Naples to Fort Lauderdale was at an April 2008 meeting held in Orlando. Local residents were outraged from the get-go that FDOT officials would hold a meeting more than three hours from the counties affected by the proposal.
The deal was fraught from there.
In June, officials announced they would re-post the request for qualifications, the equivalent of re-advertising a job opening to seek resumes. They said they needed to clarify some of the requirements and ask for additional information. The field of interested firms dropped from eight to six after that.
When, during a “short-listing” process, the state did not remove any firms from the running and instead asked all six to bid, a few eyebrows went up, including Poole’s. It typically makes sense to invite just two or three firms to bid, Poole said, in order to give those in the running a sense that they have a good shot.
Phineas Baxandall, a transportation expert with the U.S. association of Public Interest Research Groups, said now is actually a better time for states to leverage their own money, anyway.
“It would be a case of outsourcing to a more expensive middle man now than when they said the deals weren’t good enough (in January),” said Baxandall. “In the meantime, the stimulus bill has introduced some bills such as the Build America bonds.”
Baxandall has been opposed to the lease proposal since the first suggestion and minced no words Monday about the state’s efforts: “The history of this has been a string of spectacular failures that are continually talked about as if a great payoff for the public is just around the corner.”
CHARLIE CRIST STEPHANIE C. KOPELOUSOS
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GOVERNOR
SECRETARY
May 18,2009 850-414-4595
MEDIA ADVISORY
The Florida Department of Transportation (FDOT) did not receive any proposals today for the right to lease, maintain, operate and receive toll revenues for Alligator Alley. The state's primary objective in pursuing the lease was to maximize value to the state for reinvestment in transportation facilities while maintaining the Alley’s high safety standards, service levels and overall quality.
The public meeting scheduled for May 29 to announce the results of the analysis of the bids received is hereby canceled.
Alligator Alley is a 78-mile section of Interstate I-75 in South Florida connecting the southwestern and southeastern coastal areas of Florida. It was originally constructed during the late 1960s as a two-lane, controlled access toll road and was known in the original bond documents as Everglades Parkway. From 1986 to 1992, Alligator Alley was widened to four-lanes and made a limited access, tolled, interstate facility (I-75).
For more information about the Alligator Alley project, please visit our Web site at:
http://www.alligator-alley.com.
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Bitten by the alligator tax
Sun Sentinel Oct. 9, 2008
Here's a quick questionnaire: Who owns the road known as Alligator Alley?
We do.
Who elected the state officials who are in charge of running and maintaining Alligator Alley?
We did.
Which elected officials have absolutely no capability of managing a budget? As money pours in for Alley lease will funding dry up? By BRENT BATTEN Naples Daily News September 29, 2008 The Florida Department of Transportation pours millions of dollars a year into road work in Collier County. What many are wondering is whether that spigot will be shut off if Alligator Alley is leased. The lease of the Alley promises to bring millions of dollars for road construction to Collier and Broward counties and to bring it quickly. But state officials can offer little assurance that the windfall will be over and above the flow of money already coming. There is a nagging suspicion that the base level funding that Collier has experienced will dry up, with Alley revenue taking its place, leaving the county not much better off than it was before. Such a funding switch would mimic the common perception that the state lottery — which was supposed to augment education funding — was simply used to replace existing education funding, with lawmakers finding other places to spend what had been base education dollars. Over the next five years, the FDOT expects to spend about $150 million on roads and bridges in Collier, according to spokeswoman Debbie Tower. Major projects include $12 million for resurfacing U.S. 41 East between Collier Boulevard and State Road 92 over the next two years, more than $7 million to replace the Cocohatchee River Bridge on Vanderbilt Drive and almost $34 million adding lanes to Davis Boulevard between Santa Barbara Boulevard and Radio Road by the end of 2012. But the state road budget isn’t set in asphalt. Any number of factors, including a lame economy, could cause those figures to change. The lease of Alligator Alley to a private concessionaire would bring millions — some estimates range as high as a billion — dollars that ostensibly would be used to fast forward projects on the FDOT drawing board in Collier and Broward counties, where the road is situated. Say the state budget really does take a hit and FDOT is forced to scale back its spending projections in the five-year period and beyond. Money from the lease could be used to fill in the gap. Knowing that, how committed are FDOT officials and state legislators likely to be to see to it that Collier gets all the funding it would have gotten otherwise with the lease revenue as a thick layer of icing? Very, says Kevin Thibault, FDOT’s assistant secretary for engineering and operations. “We expect (to maintain) roughly the same level of base service. Our commitment is that five-year work program,” he said. Thibault says projects on the wish list of the Metropolitan Planning Organization, a transportation planning group made up of local elected leaders, will be likely recipients of any income from the lease. Projects such as replacing the Jolley Bridge to Marco Island or major renovations to the intersection of Davis and Collier boulevards are cited as needs in the MPO’s plans but as yet have no funding. They would be good candidates for lease money, Thibault said. Southwest Florida’s legislators opposed to the lease plan aren’t sure it will play out that way. State Rep. Matt Hudson says he’s written letters to FDOT officials seeking clarification on the cash split with Broward County and has gotten no response. State Sen. Dave Aronberg of Greenacres points out that if spending the lease money becomes political, Collier County would stand to lose because Broward County not only has a larger contingent of legislators, it also has a transportation network that is closely tied to those of Miami-Dade and Palm Beach counties. A coalition of legislators from those counties would overpower Southwest Florida’s delegation, he points out. Broward-based state Rep. David Rivera, who represents part of Collier County, is withholding judgment on the lease proposal until he sees the details scheduled to come out Dec. 15. He acknowledged the FDOT funds to Collier could be cut on the one hand while revenue from the lease pours in on the other. “You would have no more guarantee than you have right now. DOT can cut funding right now,” Rivera said.
Just about all of them.
Who is going to get it in the neck because the Florida Department of Transportation plans to lease Alligator Alley to a private company, for 50 to 75 years, which means increased tolls for us, our children, our grandchildren, and so on and so on?
We are.
And there you have it, folks. FDOT is "hosting" sessions whose intention is to get us used to the idea of turning over the 78-mile toll road known as Alligator Alley to a politically preferred private operator. The sales pitch is that the state needs short-term cash.
Six bidders will send their propositions by the deadline, Dec. 15. (Most of the six are foreign-owned.) Florida would get a chunk of cash in front, money that supposedly would go to other "transportation projects." And the state would get a percentage of "future excess toll revenues."
Yeah, right. We share in "excess" toll revenues. What the deal proves is that our chosen representatives are incapable of managing a budget and have to sell off the crown jewels to make ends meet. Alligator Alley is generating $3 million a year in revenue. Cars pay $2.50 cash or $2 with SunPass to cross the Alley. The plan already is to raise those rates to $3 cash in the next year or so.
A consultant estimated that turning the road over to a private party would mean tolls of $6.75 to $10 within the next 10 years. After a public eruption of annoyance, the consultant and his estimate quietly disappeared.
A relevant issue is, what about the Everglades? What responsibility, if any, will a private contractor have in keeping the Everglades from being inundated with junk and garbage? Why not just have Halliburton or Blackwater take it over? That would end the problem of wild animals whose home is the Everglades, and any citizen objecting disappears the way the consultant did.
Oh, so the state of Florida is short of cash? Gee, what a surprise.
Oh, so a private contractor can handle the operation of a road better than the state can? Gee, that's no surprise.
An idea of equal merit: Lease Florida government to an outside contractor. Whoever that person or company might be, anybody and everybody knows it would be an improvement.
Herschell Gordon Lewis is an author, director and longtime Broward resident. E-mail comments to dfwhite@tribune.com.
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