Montgomery County Council

Legislative Branch

Press Releases - County Council

For Immediate Release: Tuesday, August 10, 2021

ROCKVILLE, Md., August 10, 2021—Yesterday, the Montgomery County Council sent a letter to the Maryland Board of Public Works requesting that a vote on the pre-development agreement for the state's public-private partnership to build toll lanes on I-270 and I-495 only occur after the report from the state's financial advisor and bond counsel is complete.

This contract will set the terms for a business partnership between the state and the selected concessionaire involving $6 billion in construction. The Council believes that the state should not enter into an agreement of this magnitude without due diligence to fully understand and review the contractual obligations.

In addition, the Maryland P3 law requires the State Treasurer's Office, in coordination with the Office of the Comptroller, to analyze the impact of a public-private partnership on the state's capital debt affordability limits.

The full text of the letter by the Council is below and attached.

Dear Governor Hogan, Comptroller Franchot and Treasurer Kopp:

As you know, Montgomery County has been in continuing dialogue with the Maryland Department of Transportation over Governor Hogan's initiative for a Public-Private Partnership to build toll lanes on I-270 and I-495.

Soon to come before the Board of Public Works is the Pre-Development Agreement for Phase 1 of this plan, running from the American Legion Bridge to I-270 in Frederick. Alongside its importance for the State's future transportation infrastructure, this contract will set the terms for a business partnership between the state and the selected concessionaire involving some $6 billion in construction and enduring for more than half a century.

The Maryland P3 statute requires the State Treasurer’s Office, in coordination with the Office of the Comptroller, to analyze the impact of a public-private partnership on the State’s capital debt affordability limits. When the Treasurer reported to the General Assembly on July 9, she stated that she "was unable to fully engage the State’s Financial Advisor and Bond Counsel to assist with the review" because the state Department of Budget and Management did not approve a request for $100,000 to pay for that work. As a result, "key risks, costs, terms, and conditions" may not have been identified.

As you know, last month the majority of the Montgomery County Council supported including in the Transportation Planning Board’s Long Range Plan the newly revised version of Phase 1, which incorporates substantial funding to construct with toll revenue either the Corridor Cities Transitway or the MD 355 Bus Rapid Transit Line. However, regardless of one's view of the policy merits of any project, the State should not enter into an agreement of this magnitude without due diligence to fully understand the contractual obligations we are assuming. Careful study of the contract by the Bond Counsel and Financial Advisor is a necessary part of that due diligence.

We therefore ask you to vote on the pre-development agreement only after funding for review by the Financial Advisor and Bond Counsel has been provided and these experts have completed their work and reported to you and the General Assembly. We ask that the State Department of Budget and Management provide funding as soon as possible so that the review by the Bond Counsel and Financial Advisor can be completed expeditiously.

Sincerely,

Hucker