The $2.04 billion Eagle Public-Private Partnership (P3) Project will provide new rail transit options along three corridors in metropolitan Denver. Key elements of the project include:
- The East Corridor, a commuter rail line extending 22.8 miles from Denver Union Station (DUS) east to Denver International Airport, with six intermediate stations in Denver and the City of Aurora.
- The Gold Line, an 11.2-mile commuter rail line extending from DUS to the City of Wheat Ridge northwest of Denver, with six intermediate stations.
- The Northwest Rail Electrified Segment (NWES), a 5.3-mile initial portion of the Northwest Rail line that will provide commuter rail service from DUS to South Westminster (the full Northwest Rail Line will eventually extend 41 miles through Boulder to Longmont). The first 3.7 miles of the NWES from DUS to Pecos Junction will be shared with the Gold Line
- A commuter rail maintenance facility (CRMF), which will service all commuter rail lines in the region, including those being developed outside of the Eagle project.
- Related system elements including rolling stock and other ancillary improvements.
The Eagle P3 Project is part of the larger FasTracks program, a voter-approved, tax-backed transit plan expanding rail and bus service throughout metropolitan Denver being implemented by the Denver Regional Transportation District (RTD). The project was procured by RTD as a 34-year design-build-finance-operate-maintain (DBFOM) concession contract. RTD will make monthly availability payments to Denver Transit Partners, LLC, the private concessionaire, based on the availability and performance of the facility. RTD will retain ownership of the assets throughout the concession period, set fares and fare policies, and retain all project revenues. RTD is the first transit agency in the nation to successfully pursue a comprehensive P3 that draws on a mix of federal loans and grants and private investments to move major capital transit projects in the region forward.
The Eagle P3 Project dates to 2001 when RTD and local communities expressed interest in implementing a comprehensive, region-wide transit program. In April 2004, RTD’s Board of Directors and the Denver Regional Council of Governments (DRCOG) approved a transportation expansion program developed by RTD known as the FasTracks Plan. In November 2004, voters approved a 0.4 percent sales tax increase dedicated to the implementation of the FasTracks program, on top of RTD’s existing 0.6 percent sales tax used to fund its transit program.
The overall FasTracks program includes the construction of four new commuter rail lines (East Corridor, Gold Line, Northwest Rail Corridor, and North Metro Corridor); the CRMF; two new light rail lines (West Corridor and I-225 Corridor); bus rapid transit service on US-36; and extensions of existing light rail lines (Southeast Corridor, Southwest Corridor, and Central/Central Platte Valley), among other improvements.
Following the regional FasTracks vote, unprecedented increases in commodity and material costs in the mid-2000’s led to a significant escalation in the cost of the program. In response to this challenge, RTD proposed the use of a P3 to deliver a large portion of the program in order to reduce costs and transfer certain risks to the private sector. RTD’s decision came as the Federal Transit Administration (FTA) published details of its new P3 Pilot Program (Penta-P) in January 2007. In July 2007, FTA accepted RTD’s proposal to develop the East Corridor, Gold Line, and CRMF as a single pilot project under the Penta-P program.
RTD initiated the procurement process in August 2008 with a Request for Qualifications to identify and shortlist teams capable of delivering the Eagle P3 Project, followed by a request for proposals to three shortlisted private consortiums in December 2008. During this time, elements of the project also continued to advance through the environmental review and FTA New Starts processes, with the East Corridor and Gold Line projects receiving Records of Decision in November 2009 and approval to enter final design in April 2010.
In June 2010, RTD selected Denver Transit Partners – comprised of Fluor Enterprises, Uberior Infrastructure Investments, and John Laing Investments – as its preferred concessionaire. The Eagle P3 Project achieved financial close in August 2010, and RTD issued a Notice to Proceed (NTP) for Phase I of the project (consisting of design activities, the CRMF, and construction of the East Corridor) shortly thereafter. In August 2011, RTD received a New Starts Full Funding Grant Agreement (FFGA) from FTA, which allowed it to issue a second NTP covering the Gold Line and the NWES. RTD subsequently closed on a TIFIA loan to help finance its contributions to the project in December 2011. The three rail lines in the Eagle P3 Project are all scheduled to initiate service in 2016.
Project Financing and Delivery
The Eagle P3 Project is drawing on a variety of funding and financing sources for its implementation. Sources of direct public funding for the construction of the project include a $1,030 million FTA New Starts FFGA; $128 million in direct RTD contributions from FasTrack sales tax revenues; $62 million in other Federal grants; and $40 million in contributions from local city and county governments. Additional financing sources for the projects include a $280 million TIFIA loan; $398 million in tax-exempt Private Activity Bonds (PABs); $48 million in revenue bond proceeds; and $54 million in private equity contributions.
The TIFIA loan, which was made directly to RTD, is secured by a senior lien pledge of revenues from RTD's 0.4 percent FasTracks program sales tax and a subordinate lien pledge of revenues from RTD's original dedicated 0.6 percent sales tax. The availability payments due to DTP under the concession agreement will cover repayment of the PABs and returns to the concessionaire’s private equity contributions.