Public-private partnerships (P-3) are contractual agreements formed between a public agency and a private sector entity that allow for greater private sector participation in the delivery and financing of transportation projects. Under the P-3 model, a private partner may participate in some combination of design, construction, financing, operations, and maintenance. Many P-3 projects are also utilizing Design-Build (D-B), a project delivery method that combines two, usually separate services into a single contract. With D-B procurements, owners execute a single, fixed-fee contract for both architectural/engineering services and construction. The D-B unit may be a single firm, a consortium, joint venture or other organization assembled for a particular project. While the design-builder assumes responsibility for the majority of the design work and all construction activities, together with the risks associated with providing these services for a fixed fee, the owners typically retain responsibility for financing, operating and maintaining the project.
In a related development, Section 1503 of the Safe, Accountable, Flexible and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU; 2005) required FHWA to modify its rules regarding design-build contracts issued by state departments of transportation
(state DOTs). The provision required FHWA to allow state DOT projects conducted under design-build contracts to proceed through the preliminary design stage before the NEPA process is complete. The Final Rule for Design-Build Contracting was issued August 14, 2007 and became effective September 13, 2007. This Rule streamlined the project development process for design-build projects by allowing state DOTs to conduct the NEPA process in parallel with entering into a design-build contract for the project and proceeding through the preliminary design stage. As a result, many state DOTs began considering using the D-B process to streamline project delivery.
While the D-B method of project delivery can save time and promote effective co-ordination between the contracting agency, the designer, and the contractor, there are risks involved. One of those risks is that environmental commitments (including those made for historic
properties/Section 106, Section 4(f) water quality permits and mitigation, threatened and endangered species, hazardous materials, air quality, and noise) either may be overlooked, not be adequately addressed, or require revisions due to subsequent design modifications made by the P-3 or D-B contractor. Failure to follow through on the commitments agreed upon during the NEPA process can have serious consequences, including project delays and damage to the relationships between a state DOT and its respective regulatory, land-managing, and Tribal partners, and potentially result in legal action.
According to 23 CFR 636.109 (How does the NEPA process relate to the design-build procurement process?) the D-B contract must include appropriate provisions to ensure that all environmental and mitigation measures identified in the NEPA document will be implemented. However, since 23 CFR 636.109 does not define “appropriate provisions” or state DOT processes needed to ensure (1) that specific contract provisions related to environmental commitments are consistent and unambiguous and (2) how the implementation of said contract provisions will be monitored to ensure compliance on the part of the D-B contractor.
The purpose of this research is to identify and synthesize “successful practices” for environmental commitments made in P-3 and D-B contracts are kept. These may include the timing of NEPA analyses and commitment development. Case studies that demonstrate how these practices are implemented and how they are transferable to other State DOTs will also be provided.