California Transportation Ventures - Kent Olsen and Charles Stoll

By: Willem Verbaan, Director, Vermeer Infrastructuur Ontwikkeling B.V.

Wednesday 12 April 2000, 10:45 hours

1. California Transportation Ventures (CTV), is a special purpose vehicle.
   Shareholders: * Parsons Brinckerhoff
   * Egis Projects (F)
2. Stakeholders/players in the project:
   * Caltrans
   * Sandag
   * US Department of Transportation
   * CTV
3. Description of the project:
   * Mile corridor, close to down town San Diego.
   * Serves southernpart to Mexico, (a lot of trade).
   * Area development, houses, business parks
   * Total budget US$ 530 Mio, private part US$ 411 Mio.
   
4. Lay out Adjusted to environmental resources (f.i. Wetland areas).
   
5. Extension to the north is under construction, public funded.
   
6. There is value capturing through a so-called DIF-system (development Impact Fee). Developers pay to the local Government. The local Government brings in the land. However, there is discussion about the use of DIF-funds.
   
7. Procedure took almost 40 years due to politics, environmental issues. Private sector came in in 1990, which accelerates the process.
   
8. Public Agencies:
   * Caltrans
   * Federal Highway Administration
   * Sandag
   
9. There is a Public Part and a Private Part. This is crucial for the traffic flow. If there is a delay in the Public Part, it will have impact on the business results.
   
10. Franchise:
    Owned by a limited partnership CTV and Koch Industries / Fluor Daniel.
    * FDBOT
    * 35 year
    * Shareholders return capped at 18,5%, higher results go to Government.
    
11. Private Sector Requirements
    * Avoidance of tort liability
    No restrictions to modify toll
    
12. Federal Credit Facilities, total US$ 127 Mio:
    * US$ 91 guarantee
    * US$ 36 Standby line of credit (FiFiA).
    
13. Traffic Expectation 20.000 vehicles a day.
    15 cents/mile plus. 25 cents per transaction.
    
14. Lesson learned
    * Environmental process is a legal / political process
    * Allow mix funds
    * Dependence on other Public Projects should be limited