The Indiana Department of Transportation (INDOT) will take direct control of the I-69 Section 5 project from I-69 Development Partners in a settlement agreement with the Indiana Finance Authority (IFA).
INDOT will take over by July 31 this year and the more than 30 subcontractors working on the project will continue their scope of work.
“I am delighted for Indiana taxpayers that we have reached an agreement for the State to assume control and finish this project,” says Governor Eric J. Holcomb.
IFA Public Finance Director Dan Huge reports the takeover will not increase the overall project cost and could in fact “provide the state future savings.” The new agreement could lower the project cost to $560 million, a reduction of $30 million compared to the original cost in “today’s dollars.”
Settlement details include:
- IFA will issue lower interest highway revenue bonds, anticipated to be rated AA+ to fully replace the developer’s private activity bonds, originally rated at BBB- and related interest for a total amount of $246 million in bonds
- The I-69 Development Partners will provide an additional $12 million to the bondholders and $50 million to the IFA as part of the settlement
IFA reports the agreements release the state from future liabilities or claims with “bondbolders, the developer, design-builder Isolux Corsan and insurance and surety companies.” Indiana takes on all future financial risk for the project over the next 35 years.
“INDOT’s first task is to ensure a smooth transition of project teams,” says INDOT Commissioner Joe McGuiness. “As we work through those initial changes, construction work that is currently underway will continue. More important, there will be no lapse in the safety and mobility operations that keep traffic moving and the work zone safe.”