[Federal Register Volume 79, Number 25 (Thursday, February 6, 2014)]
[Pages 7274-7275]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-02589]



Federal Highway Administration

[Docket No. FHWA-2014-0006]

Draft Core Toll Concessions Public Private Partnership Model 
Contract Guide

AGENCY: Federal Highway Administration (FHWA), DOT.

ACTION: Notice; request for comments.


SUMMARY: The Moving Ahead for Progress in the 21st Century Act (MAP-21) 
requires DOT and FHWA to develop public-private partnership (P3) 
transaction model contracts for the most popular types of P3s for 
transportation projects. Based on public input on the most prevalent P3 
transaction type and the need for an educational, rather than 
prescriptive contract model, the FHWA has developed a draft Core Toll 
Concession Model Contract Guide. The FHWA values public input in the 
development of the model contracts, and seeks continuing input. A draft 
of the Core Toll Concession Model Contract Guide is provided with this 
notice so that the general public and interested stakeholders may 
provide comments. This model contract guide has been prepared solely 
for informational purposes and should be not construed as a statement 
of DOT or FHWA policy.

DATES: Comments must be received on or before March 10, 2014. Late 
comments will be considered to the extent practicable.

ADDRESSES: To ensure that you do not duplicate your docket submissions, 
please submit them by only one of the following means:
     Federal eRulemaking Portal: Go to http://www.regulations.gov and follow the online instructions for submitting 
     Mail: Docket Management Facility, U.S. Department of 
Transportation, 1200 New Jersey Ave. SE., W12-140, Washington, DC 
     Hand Delivery: West Building Ground Floor, Room W12-140, 
1200 New Jersey Ave. SE., between 9 a.m. and 5 p.m., Monday through 
Friday, except Federal holidays. The telephone number is (202) 366-
     Instructions: You must include the agency name and docket 
number at the beginning of your comments. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal information provided.

FOR FURTHER INFORMATION CONTACT: Ms. Deborah E. Brown-Davis, Office of 
Innovative Program Delivery, (202) 366-4249, Ms. Alla Shaw, Office of 
the Chief Counsel, (202) 366-1042, Federal Highway Administration, 1200 
New Jersey Avenue SE., Washington, DC 20590, and Mr. Prabhat Diksit, 
Office of Innovative Program Delivery, 12300 W Dakota Ave., Suite 370, 
Lakewood, CO 80227, (720) 963-3202, or via email at 
[email protected]. Office hours for the FHWA are from 8:00 a.m. to 
4:30 p.m., Monday through Friday, except Federal holidays.


Electronic Access and Filing

    You may submit or retrieve comments online through the Federal 
eRulemaking portal at: http://www.regulations.gov. The Web site is 
available 24 hours every day of the year. Electronic submission and 
retrieval help and guidelines are available under the help section of 
the Web site.
    An electronic copy of this document may also be downloaded from the 
Office of the Federal Register's home page at: http://www.archives.gov/federal_register and the Government Printing Office's Web page at: 


    Public-private partnerships are contractual arrangements between 
public and private sector entities that allow for greater participation 
by the private sector in the delivery of surface transportation 
projects and associated services. Generally, in addition to designing 
or building a project, a private partner in a P3 may be involved in 
financing, operating, and maintaining the project. By transferring 
certain risks and responsibilities to the private partner, P3s can 
result in more efficient and effective project delivery. However, P3 
contracts are complex and are of a much longer-term duration than 
traditional construction contracts. Their terms and conditions address 
many requirements not covered by traditional construction contracts 
such as financing arrangements and performance during a concession 
period, among others. Public agencies need special expertise to

[[Page 7275]]

ensure that they can successfully negotiate P3 agreements. Section 
1534(d) of MAP-21 (Pub. L. 112-141; 126 Stat. 405) requires the DOT to 
develop model P3 contracts that could serve as a model and a guide to 
States and other public transportation providers in developing their 
own P3 contracts. The legislation states:

    (1) DEVELOPMENT.--Not later than 18 months after the date of 
enactment of this Act, the Secretary shall develop standard public-
private partnership transaction model contracts for the most popular 
types of public-private partnerships for the development, financing, 
construction, and operation of transportation facilities.
    (2) USE.--The Secretary shall encourage States, public 
transportation agencies, and other public officials to use the model 
contracts as a base template when developing their own public-private 
partnership agreements for the development, financing, construction, 
and operation of transportation facilities.''

    Development activities to date, include receipt of comments during 
a January 16, 2013, Listening Session attended by a broad cross-section 
of P3 stakeholders. In addition, DOT solicited comments regarding model 
P3 contracts in a prior notice published at 78 FR 1918, January 9, 
2013. All comments may be viewed at: http://www.fhwa.dot.gov/ipd/p3/resources/model_p3_contracts.htm.
    Based on comments received thus far, the DOT has advanced the 
development of a draft model P3 contract guide for the most popular 
type of P3 contract, namely the toll concession contract. We request 
comment from the general public and stakeholders on the Core Toll 
Concession Model Contract Guide provided.

About the Core Toll Concession Model P3 Contract Guide

    During the January 16, 2013, Listening Session, the majority of the 
commenters requested that the FHWA not provide a rigid model contract 
that States and localities would be required or encouraged to follow, 
particularly when Federal grant or credit assistance was an essential 
element of a project. The concern was that model contract provisions 
would become mandatory--an approach that would not work in a nation of 
many diverse States and localities. Stakeholders expressed a preference 
for an ``educational'' style of model contract that would assist State 
and local governments in negotiating and developing their own P3 
contracts. The FHWA agrees with these comments. The FHWA has never 
intended for these model contracts to be mandatory. Rather, these model 
contracts are merely intended as an informational tool for State and 
local governments to refer to whenever entering into a P3 transaction. 
These model contracts should be not construed as a statement of DOT or 
FHWA P3 contract requirements or policy.
    Stakeholders also expressed a preference for a model contract that: 
(i) Does not include standard boilerplate language; (ii) focuses only 
on those provisions specific to P3s; and (iii) focuses primarily on the 
more controversial and/or complex provisions that warrant amplified 
    After considering the comments received from the January 2013 
notice and listening session, FHWA has chosen to focus first on seven 
specific contractual provisions critical to achieving public sector 
objectives and protecting the interest of the taxpaying and traveling 
    1. Tolling regulation (The right to charge tolls; how tolls are 
    2. Revenue Sharing (Approaches to sharing of ``excess revenues or 
profits'' between concessionaires and a public owner for projects that 
produce revenue);
    3. Supervening Events (Types of contractual relief typically 
granted for unforeseen events, and compensation as required);
    4. Changes in Law (How changes in law, after a contract has been in 
effect, will be dealt with);
    5. Changes in ownership (Restrictions on transfers and permitted 
    6. Default, early terminations and compensation (How the various 
types of terminations and default events are to be treated); and
    7. Hand-back (Issues related to the hand-back of facilities on 
contract termination).
    The draft Core Toll Concessions Model P3 Contract Guide discusses 
these key issues with an eye to helping states with their own P3 
contracts. The draft Guide includes an introduction, discussion of the 
key provisions in the context of a typical contract; and an appendix 
with a glossary of terms as used in the Guide. An electronic copy of 
the draft Guide can be found at: http://www.fhwa.dot.gov/ipd/pdfs/p3/model_p3_core_toll_concessions.pdf.
    In addition to addressing the seven key provisions discussed above, 
FHWA will also develop several secondary, yet still important 
provisions, found in typical P3 tolling contracts. The secondary 
provisions will include issues such as performance standards, contract 
length, capacity triggers, consumer protections, continuing disclosure 
requirements, Federal requirements, and perhaps brief discussions of 
other provisions, as well. A draft compilation of a tolling concessions 
model P3 contract guide including both primary and secondary provisions 
will be published in the Federal Register after completion to solicit 
comments from stakeholders and other interested parties.
    Based on public input, the second most popular type of P3 contract 
is the availability payment based contract. These are transactions 
where payments from public sector revenues are the source of payments 
to the private sector partner. Although this model has been implemented 
only three times in the U.S., FHWA will be publishing an Availability 
Payments Model P3 Contracts Guide in 2014. Issues such as performance 
standards, hand back requirements, changed circumstances, default/
termination, and Federal requirements, as well as other non-core issues 
will be discussed in the document. Many of the provisions from the Toll 
Concessions Model P3 Contracts Guide are also germane to the 
Availability Payments Model P3 Contracts Guide. There will be a draft 
version of the availability payment contract template published in the 
Federal Register to solicit comments from stakeholders and other 
interested parties.
    The core Toll Concession Model Contract Guide provisions are being 
delivered early to ensure that the congressionally established deadline 
of April 1, 2014, is met. However, please be advised that FHWA will 
incrementally produce additional provisions to more fully build out the 
model contracts guide for toll and availability payment P3 concessions.

    Authority: Section 1534 (d) of Moving Ahead for Progress in the 
21st Century, MAP-21, enacted October 1, 2012.

    Issued on: January 30, 2014.
Gregory G. Nadeau,
Deputy Administrator.
[FR Doc. 2014-02589 Filed 2-5-14; 8:45 am]