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Maryland board approves contract for Australian firms to develop toll lanes on I-270, Beltway

Approval starts 30-day public and legislative review process ahead of Board of Public Works vote

The board for Maryland's tolling authority approved a contract for companies to develop toll lanes for part of the Capital Beltway and Interstate 270. (Katherine Frey/The Washington Post)

The board for Maryland’s tolling authority approved a contract Tuesday for two Australian firms to develop toll lanes for part of the Capital Beltway and Interstate 270, even as the contract remains under protest by a losing bidder.

The contract would be limited to the two companies, Transurban and Macquarie, doing preliminary design at their own expense. However, it also would give them the right of first refusal on a broader agreement worth billions to build the lanes and keep most of the toll revenue over 50 years in exchange for financing construction.

Maryland Gov. Larry Hogan (R) proposed the highway widenings in 2017 to relieve congestion and form a regional network of express lanes with Northern Virginia, which has more than 50 miles of toll lanes. Toll lanes would be free for carpools and buses, and regular lanes would remain free. Hogan has said the project would come at “no net cost” to taxpayers.

The Maryland Department of Transportation’s pursuit of a private partner for the proposal has drawn criticism because the state has yet to secure federal environmental approval or resolve the bid protest. Under the contract, the state would have to reimburse the private team up to $50 million of its predevelopment costs if the project is canceled.

The potential for the bid protest to end up in a court battle also has raised objections among the project’s opponents. A lawsuit set off a series of delays on Maryland’s light-rail Purple Line project, stalling construction and costing the state an additional $250 million.

Maryland scales back most controversial part of Beltway toll lanes plan

Jeffrey Folden, an MDOT project official, said the state rejected the protest filed by a bid team led by Spanish firm Cintra that alleged the winning proposal was based on unrealistic construction costs. Folden said that the protest was inaccurate and untimely and that the Transurban-led team had a “strong” technical proposal and superior financial pitch.

“We feel moving forward now is necessary to protect substantial state interests in managing risks and meeting our infrastructure needs,” Folden told the board. “Delaying the predevelopment work would do irreparable harm to the state.”

The predevelopment contract must be approved by the Board of Public Works before becoming final. That vote is expected in July, after a 30-day public and legislative review period.

Project opponents said it was financially irresponsible for MDOT to pursue a contract to develop the toll lanes plan, which includes replacing and expanding the American Legion Bridge, before it knows how widening the highways would affect the environment and surrounding communities.

“The public has the right to know the facts and the pros and cons before any contracts are signed,” said Arthur Katz, testifying Tuesday for advocacy group Citizens Against Beltway Expansion.

Asked about such criticisms after the vote, Maryland Transportation Secretary Gregory Slater said getting the firms onboard early will allow them to minimize the effects of the highway widening while the environmental study is finalized.

“We have a critical piece of infrastructure with the American Legion Bridge that we need to address,” Slater said.

The board for the Maryland Transportation Authority, which operates the state’s toll roads and bridges, approved the contract unanimously, with no discussion.

Maryland rejects protest by losing bidder on contract to develop toll lanes for Beltway, I-270

Under the state’s plan, the first 12 miles of toll lanes — two in each direction — would be built on the Beltway between the Virginia side of the American Legion Bridge and the I-270 spur and then up I-270 to I-370. I-270 would get one new lane in each direction, and existing carpool lanes would be converted to toll lanes.

At a rally after the vote Tuesday along I-270 in Rockville, about 80 project opponents called for more mass transit rather than wider highways. Montgomery County Executive Marc Elrich (D) said the state should seek federal funding to replace the aging bridge and explore financing other highway improvements itself rather than resorting to a public-private partnership.

He called the state’s plan an “overly expensive” solution, saying two new reversible lanes on both highways would alleviate morning and evening congestion.

“This is not needed,” Elrich said to cheers.

Montgomery Council President Tom Hucker (D-District 5) told the crowd he and Rep. Anthony G. Brown (D-Md.) met recently with U.S. Transportation Secretary Pete Buttigieg about Maryland’s highway plans. Hucker said they told Buttigieg local officials wanted more mass transit to serve lower-income people and fight climate change.

“He’s very interested; he asked a lot of questions,” Hucker said of Buttigieg. “The federal government, I can tell you, knows a lot of the problems” in the toll lanes plan.

The focus now moves to the Board of Public Works, which approves major state contracts and is composed of Hogan, Comptroller Peter Franchot (D) and Treasurer Nancy K. Kopp (D). Agencies typically don’t take contracts to the board unless they are assured they have the necessary two votes for approval, and Hogan is expected to support his signature highway expansion plan.

Maryland selects Transurban, Macquarie to develop toll lanes

Opponents have said they will target their lobbying efforts on Franchot, who is running for governor. While state officials say most motorists desperately want traffic relief, much of the opposition has come from Democratic leaders in Montgomery and Prince George’s counties, environmental groups and transit advocates — all key constituencies for a Democratic gubernatorial candidate.