The final stretch of the I-75 modernization project, which runs through Madison Heights and Royal Oak and includes the infamously congested I-696 “braid” interchange, is set to be finished about 10 years early under a public-private partnership.

The final stretch of the I-75 modernization project, which runs through Madison Heights and Royal Oak and includes the infamously congested I-696 “braid” interchange, is set to be finished about 10 years early under a public-private partnership.

File photo by Deb Jacques


Bidder named for I-75 P3 agreement

By: Tiffany Esshaki | C&G Newspapers | Published September 17, 2018

METRO DETROIT — It took about a year, but the Michigan Department of Transportation finally believes it has found the right private partner to complete — and expedite — the Interstate 75 modernization project.

Last September, after completing the first portion of the 18-mile-long project in Bloomfield Township and Auburn Hills, MDOT announced that it would seek lenders for a public-private partnership, known as a P3. The funds would give the department the upfront cash it needed to put the project into overdrive and complete the work an estimated 10 years sooner than planned.

The Oakland Corridor Partners team was named the preferred bidder to design, build, finance and maintain the final 5-mile segment of the project between Eight Mile and 13 Mile roads, currently pinned at a cost of about $1.4 billion.

Included in the plan are improvements to 28 bridges on the stretch spanning Hazel Park, Madison Heights and Royal Oak, along with safety upgrades to the infamous “braid,” which separates traffic entering northbound I-75 from Interstate 696 and northbound I-75 traffic exiting at 11 Mile Road.

The Oakland Corridor Partners will, if the contract is closed later this year, complete the project and collect availability payments originally earmarked for the I-75 modernization project over the course of 30 years. Under the original plan, the cash would have been collected from state taxpayers over time and work would have been completed in five separate segments over the next decade.

To boot, the Oakland Corridor Partners team will maintain the stretch for 25 years after construction is finished.

“The staff overseeing the creation of this unique contracting method worked tirelessly analyzing different options to determine that the DBFM (design, build, finance and maintain) model would provide the best project for Michigan in terms of innovation and delivery while meeting the project goals and objectives,” State Transportation Director Kirk T. Steudle said in a prepared statement. “In agreements that transfer maintenance responsibilities to a private party, the public owner benefits from guaranteed performance standards and long-term pricing that is locked in throughout the agreement.”

Crafting the agreement and seeking private participants over the past year was as tough as it sounds, according to Rob Morosi, MDOT’s communications specialist, since the P3 will need to benefit all stakeholders. The benefit to the Oakland Corridor Partners is their ability to buy in bulk and avoid inflation for both materials and contractors, build the stretch quickly, and save cash. When the original earmarked amount is paid to the investor years from now, they’ll be able to keep the difference.

The process has been done successfully before in Colorado and Ohio, according to Morosi.

“The creation of the innovative contract was a collaborative effort. We analyzed various acceleration options and engaged the private market to not only understand their perspective, but also to gauge their interest in participating,” Morosi said in an email.

Representatives from the Oakland Corridor Partners could not be reached for comment by press time.

Morosi noted that the contract between MDOT and the Oakland Corridor Partners is not finalized, but it should be in place this calendar year. Detailed plans on construction, activities and timelines will be announced at that time.

For more information on this and other state roadway projects, visit michigan.gov/mdot.