I-77 Contractor Has Concerns Over Discussions About Contract's Fate

May 17, 2018

The private contractor building toll lanes on I-77 north of Charlotte says revising or ending its contract will cost a lot more than what's been discussed at an NCDOT advisory committee in recent months.  That warning came in letters from I-77 Mobility Partners to the DOT.  

NCDOT will have to pay compensation if it revises or cancels the contract to build and operate toll lanes between Charlotte and Mooresville. The question is how much.

Javier Tamargo, CEO of I-77 Mobility Partners

CEO Javier Tamargo has written to NCDOT at least twice objecting to what he called "incorrect information" discussed at meetings of the DOT's local advisory committee. That group of local elected officials has met seven times since January to examine options for revising or ending the 50-year, 650 million dollar contract.

Tamargo says some presentations to the group have failed to include the project's fair market value - as required in the contract. For example, he says slides from a March meeting put the termination cost at $340 million. But he says that omits projected toll revenues and profits.

An NCDOT consultant has said it could cost between $392 million and $623 million to cancel the contract, plus the cost of any design changes or additional construction.

Tamargo also objected to a February meeting statement that his company has not invested any of its own money yet. He says they have.

And he warned that the company hasn't had a chance to evaluate costs of potential contract changes the advisory committee has discussed, such as allowing trucks in toll lanes or letting vehicles with two occupants - instead of three - ride free.

In written responses to the contractor, NCDOT says it has clarified some points with committee members. But the back-and-forth could signal tough negotiations to come, if the NCDOT tries to pursue an exit or changes to the contract.

A majority of committee members last week said they favor reducing the project to a single toll lane between Charlotte and Cornelius.

A spokeswoman says NCDOT officials have not met formally with the contractor.  A decision on the contract could come this summer. 

In a statement, I-77 Mobility Partners said it sent the letters to correct information that contradicted the contract. It says construction is on schedule for the toll lanes to open by the end of the year.