Cost of Ohio River Bridges Project drops by $240 million
LOUISVILLE, Ky. (WDRB) – It will cost less to build two new Ohio River bridges, but the savings announced Friday won't necessarily translate into lower tolls for drivers.
Kentucky and Indiana transportation officials released an updated financial plan that reduces the project's price tag to $2.3 billion, or about $240 million lower than when the cost was last estimated in 2012.
The reduction in cost reflects aspects of the project that have been previously announced – but not formally submitted to the Federal Highway Administration. They include a construction schedule that will essentially end in 2016, as opposed to 2018, and changes such as shortening a tunnel in Prospect, Ky., that will lead to an eastern Jefferson County bridge.
Both states have completed their financing. In December, Kentucky sold bonds whose repayment will require $2.1 billion in tolls from drivers over the next four decades. In 2013, Indiana pledged more than $2 billion in the coming decades from its state legislature to a developer in exchange for meeting certain goals – and then banking that toll revenue will be enough to meet those so-called "availability payments."
The lower costs announced Friday don't affect those financing plans, officials said.
"The finance team was aware of how cost estimates were trending and that was factored in," Chuck Wolfe, spokesman for the Kentucky Transportation Cabinet, said in an email.
Will Wingfield, spokesman for the Indiana Department of Transportation, said the new cost estimate is "reaffirmation of what everyone has seen from the competitive proposals in late 2012." Indiana's payment schedule is already set in its agreement with WVB East End Partners, "so the financial plan update wouldn't affect that at all," he said in an email.
The report released Friday also shows that:
- Less money is expected from tolls in the decades to come. In all, tolls will bring in $9.6 billion -- $559 million less than previously thought -- through 2058.
- Tolls on the eastern bridge will generate $227 million more than estimated, while downtown tolling will produce $786 million less than was predicted in 2012. (The changes are due to "further refinements" during a recent traffic study.)
- Indiana plans to spend $150 million more in state and federal funds during construction than state officials estimated in 2012.
The update comes ahead of Monday's scheduled meeting in Jeffersonville, Ind., of the joint board of Kentucky and Indiana officials that oversees tolling decisions.
The two states have divided work on the project. Kentucky is in charge of the new downtown span adjacent to the Interstate 65 Kennedy Bridge and a reconfigured Spaghetti Junction interchange. Indiana is responsible for the eastern bridge and the approach roads on both sides of the river.
Tolls will be charged to cross the new bridges and the Kennedy, which will become a southbound-only span (the new downtown bridge will only carry northbound traffic). Initial toll rates range between $1 to $12 and are expected to increase 2.5 percent a year.
Copyright 2014 WDRB News. All rights reserved.