Fluor Provides Innovative Approaches to Build Toll Roads, Highways, and Bridges
Fluor has extensive experience managing transportation projects to include toll roads, highways, and bridges. Fluor provides design-build and project management expertise and optimizes commercial structures to fund transportation projects in the U.S. and internationally. Fluor often forms delivery teams with complementary skills and synergies to provide innovative and cost-effective solutions to transportation projects.
The company has managed more than $10 billion in construction capital costs on infrastructure projects. Fluor is currently working on the San Francisco Oakland Bay Bridge in California and I-495 Capital Beltway EXPRESS Lanes Project near Washington, D.C.
Commercial structures that Fluor has used successfully on U.S. and international transportation infrastructure projects include:
Public-Private Partnerships - Public-private partnerships have provided governments and local authorities with an alternative method of financing and implementing major transportation projects. Fluor has a proven track record of delivering projects through this approach, offering faster schedules, lower life-cycle costs, and considerably less risk to the public sector. In addition to Fluor’s world-class project execution capabilities, the company provides a strong balance sheet and long record of financial stability that provide owners and capital markets with confidence that projects will be completed successfully.
The successful completion of the I-495 EXPRESS Lanes exemplifies Fluor's ability to execute an extraordinarily complex project ahead of schedule and on budget. The public-private partnership method used to bring the I-495 project to fruition is an excellent example of how industry can successfully partner with government agencies to deliver needed improvements to state and local infrastructure in a cost-effective manner.
Watch the video about the public private partnership used to deliver the I-495 EXPRESS Lanes.
Tolls or User Fees - Project funding is directly supported by vehicle or passenger tolls. Tolls can be directly assessed on users or payable to the concessionaire by the public sector based on usage (Shadow Tolls). The public agency sponsor benefits by the private concessionaire bearing the revenue risks. Variations of this structure where both the private concessionaire and public agency share the financial upside of any toll revenue surplus can also be used.
Availability Payments – This structure is most advantageous when a toll or user fee is not assessed, or if the public agency is willing to assume volume risk. Payments are pre-determined prior to construction and are often tied to a dedicated stream of sales or other tax revenue receivable by the public agency. The private concessionaire assumes construction and performance risk of the asset, while the public sector maintains volume risk. Availability payment appropriation risk may or may not be borne by the private sector.
63-20 Tax-Exempt Structures – IRS Ruling 63-20 authorizes public agencies, in association with a private concessionaire, to establish non-profit entities (63-20 Corporations), which may issue tax-exempt bonds on behalf of qualifying infrastructure projects. This structure transfers project risk to the private sector while the public agency maintains ownership of the asset. The 63-20 Corporation benefits the private sector by providing access to the tax-exempt debt.