Capital Beltway HOT Lanes - Frequently Asked Questions

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1 Capital Beltway HOT Lanes - Frequently Asked Questions December 20, What is the cost of the project? The fixed-price design-build cost is approximately $1.4 billion. 2. Why have the project costs increased? Two core reasons (1) we re building a better project that more effectively meets the travel needs of the region and (2) the costs of highway construction materials have risen at unprecedented rates. Rising construction materials and labor costs have contributed to an estimated $400 million increase in project costs. Several enhancements to the project have also contributed to cost increases, such as the addition of Springfield Phase VIII to complete the regional HOV network, additional access points to improve mobility in Tysons Corner and designs to promote better traffic flow at I-66 and the Beltway. One of the benefits of our partnership is that the private sector has agreed to a fixedpriced design-build contract of $1.4 billion and will assume all risks for cost overruns or delays during construction. 3. How can you guarantee costs won t continue to rise? Fluor-Transurban has committed to a fixed price design/build contract and will assume any risk associated with rising costs. The two companies have successful track records in managing mega projects well. 4. What kind of profit will the private companies make on this deal? At this stage it is too early for us to make that kind of projection. It all depends on how successful the project is and how well the private partners manage the project risks. Under the partnership agreement if the project is a financial success, the Commonwealth will share in that success. If the project fails, the private sector will bear the financial loss alone. 5. What will happen if the HOT lanes fail financially? Will taxpayers be left to pay the debt on the project? We are confident the project will be a success. Transurban and Fluor are both highly respected and strong global companies with a wealth of experience in these kinds of projects. One of the benefits of the public-private partnership is that risk is shifted to the private sector. In the event that the project was not a success, Virginia would still own the new lanes, but would not be responsible for the debt. The banks would restructure the debt and a new partner would likely take on the project, with Virginia s approval.

2 6. How will toll revenues be spent? Toll revenues will first be used to maintain and operate the HOT lanes, then to pay back the debt on the road. The private partners will also fund all the maintenance replacement needed to keep the road up to standard throughout the life of the agreement. If the private partners are successful in managing the risks of the project, additional revenue will go back to their investors. Revenue above agreed benchmarks will be shared back with the Commonwealth to fund transportation programs and projects in the corridor. 7. Was there a competitive procurement process on this project? VDOT conducted a formal solicitation for competing proposals and an independent review process before moving this project forward. Competition continues to help manage project costs. The private partners have used competitive pricing in developing cost estimates and 60 percent of the construction work will be competitively bid. In addition, VDOT commissioned an independent consulting firm to verify all construction cost estimates. 8. Under the agreement, can Transurban veto further expansion of the Beltway or improvements to surrounding roads? No. The private partners have no ability to restrict the Commonwealth, the Northern Virginia Transportation Authority or anyone else from making improvements or expansions to the region s roadways. VDOT has agreed to provide the private partners the opportunity to propose to build additional tolled lanes on the Capital Beltway if congestion would ever warrant them. 9. Why is the length of the term on the agreement so long? The length of the contract term makes the project work financially allowing for sufficient time for tolls to generate the revenue necessary to operate the road, pay back debt and allow for a fair rate of return on equity invested. VDOT chose to work with private partners who take a long-term approach to managing their roads. As a customer-based business, Fluor-Transurban has an incentive to ensure they re meeting the needs of their customers and their communities over the long-term. 10. Why couldn t the Commonwealth just finance this project on its own? With all the transportation needs, the Commonwealth does not have sufficient funding to dedicate to this project. This one project would consume more than a year of all construction funding available statewide. 11. When will construction activity begin? We will begin work in early VDOT and its partners are committed to ensuring that residents and travelers in the region remain informed, prepared and safe during the construction period. VDOT has established a robust regional traffic management and communications program to support that important goal.

3 12. Similar to the Springfield Interchange and Woodrow Wilson Bridge Project, what are you doing to manage the impact of construction on travelers, residents and businesses in the region? VDOT has launched a regional transportation management plan to ensure residents, businesses and travelers have the information and resources they need to manage the impacts of construction, including: Enhanced incident response Central information resources for lanes closures and delays Transportation demand management strategies, such promotion of telework and transit alternatives Coordination between all major construction projects in the region Safety and minimizing traffic impact are key factors in the private partners construction approach 13. Will the public have a chance to see the final design of the project? Yes. The public has played a critical role in shaping the scope of the project over the last six years. The community will have a formal opportunity to see additional project details, such as the locations of sound walls, at a public design hearing this spring. Information on the time and locations for community meetings and hearings will be posted on VDOT s Website, as well as the project s Website, How do I know if my property will be impacted? The community will have a formal opportunity to see and comment on additional project details, such as the locations of sound walls and potential property impacts, at a public design hearing this spring. In the meantime, please feel free to call VDOT or the project office at (571) or send an to inquiries@transurban.com and the project team will do its best to answer any specific questions you may have. 15. Are you taking homes and businesses as part of the project? Where? When? HOT lanes are designed to provide congestion relief with limited impact on the surrounding environment. That has certainly been the case on this project. Original plans for improving the Beltway would have taken more than 350 homes and businesses in Fairfax County. We ve reduced this number to less than ten. We will follow the same right of way process that VDOT follows. Homeowners will be treated fairly and that process will begin early this spring. In the meantime, if you are in the immediate direct impact area of the Beltway and have any concerns, please give VDOT or the project a call or and we ll be happy to work with you.

4 16. What kind of pedestrian and bike improvements will be constructed along with the project? The project will deliver a number of improvements to bike and pedestrian access in the corridor, such as on-road bike lanes, new shared us paths and wider sidewalks. VDOT is working closely with Fairfax on these improvements. More detailed plans, including bicycle and pedestrian access, will be available for the public to review at a formal public hearing this spring. 17. How will you enforce the HOT lanes? Today, toll enforcement is by camera and police monitoring. Initial HOV enforcement technology will also be police monitoring of the lanes. The private partners have proposed an enforcement strategy that would require all HOT lanes users to have an E-ZPass or similar transponder to use HOT lanes. Drivers without a transponder would be ticketed through the same kind of photo enforcement used on Virginia toll roads today. Additional technologies may be used to help law enforcement officers identify those vehicles most likely to be HOV violators. Protecting customer privacy will be paramount in the development of all enforcement strategies and the Commonwealth must approve all plans. 18. What will the tolls be? The variable toll price is the tool the project will use to make sure the HOT lanes are always free-flowing. Tolls will vary based on real-time traffic conditions to manage the number of toll-paying customers entering the HOT lanes and keep them congestion free. Because the tolls are based on real-time traffic conditions, it s impossible for us to predict exactly what the tolls will be at any given time. We expect they will range from as low as 10 cents a mile in non-peak periods to around a dollar a mile in some sections of the HOT lanes during rush hour. We expect the average rush-hour toll to be between $5 and $6. Electronic signs will provide drivers with the latest information on toll rates and allow plenty of time for customers to choose whether to use HOT lanes, or use the regular Once customers enter the lanes, they will lock in their toll rate for that segment of their trip. Toll prices won t change on them while they are in the lanes. 19. Why are the tolls higher than other roads in the region? Unlike traditional toll roads, HOT lanes use the price of tolls to control the amount of traffic in the lanes and keep them congestion free, even during rush hour. The project will use tolls prices on the lanes to manage the level of traffic with the aim to keep the lanes free flowing for carpoolers, buses and motorists who choose to pay a toll. When there is not much traffic toll prices will be low, but when congestion increases tolls will go up to regulate the number of cars in the lanes.

5 The important thing is, drivers will always have a choice they can pay to use the HOT lanes, use the premium service for free by carpooling, or continue to use the regular 20. Is there a cap on the tolls? There will be no cap because, unlike traditional toll roads, the HOT lanes will use the price of tolls to manage the amount of traffic in the lanes and keep them congestion-free even during rush hour. HOT lanes will be one of many options for drivers on the Beltway when they need a faster or more reliable trip. Travelers may also choose to use HOT lanes for free by carpooling, take a bus on HOT lanes, or continue to use the regular 21. How will I know what my toll price is? Electronic signs will provide drivers with the latest information on toll rates and allow plenty of time for customers to choose whether to use HOT lanes, or use the regular 22. Won t HOT lanes just benefit the rich? HOT lanes will benefit all travelers by taking cars off the regular lanes and providing for the first time opportunities for carpooling and transit on the Beltway in Virginia. Research on existing HOT lanes users in other parts of the country reveals that people of all incomes choose to pay tolls when they need a faster, more reliable trip time, such as when they need to pick up a child from daycare or make an important business meeting on time. A study of the SR-91 Express Lanes in California revealed that only 25 percent of motorists who choose HOT lanes fall within the highest income level. 23. How can I get a copy of the partnership agreement? The final comprehensive agreement and the design-build contract will be available on VDOT s Website. # # #

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