|Bridging Pennsylvania Constructors—S&B USA Construction and FCC
|Financially closed on December 22, 2022—construction began in September 2023 and is expected to be completed between by the summer of 2028
S&B USA is part of Bridging Pennsylvania Developers (BPD), a group that formed as a response to the PennDOT Pathways Program, which is designed to bolster PennDOT’s ongoing effort to address the state’s growing backlog of replacement and rehabilitation needs for major bridges that are approaching the end of their lifespan. This project consists of designing, building, financing, and maintaining six bridges in critical need of replacement across the Commonwealth. This deal reached a financial close of nearly $1.5 billion. This project will have a direct positive impact on PA residents, businesses and the local economy.
This P3 utilized a Project Development Agreement (PDA), a collaborative approach between the developer and the grantor. The developers (S&B USA and Macquarie) were chosen on a number of factors, such as experience, rather than a competitive bid. Additionally, the use of a PDA helps to eliminate issues such as delays and unforeseen construction issues. The developer will also operate and maintain these assets for a period of 35 years.
S&B USA has been and is an integral component of the Bridging Pennsylvania Partners team. From the start of the procurement through the identification of BPP as our Pre Development Agreement partner, S&B USA was always very helpful and considerate of the position of PennDOT regarding the replacement of interstate bridges. Once we executed the PDA and entered that phase, that level of cooperation only increased to the point where we were able to successfully reach commercial and financial close in an accelerated timeframe that is a result of all partners successfully working together. We are looking forward to S&B’s continued partnership in the successful delivery of our Major Bridge P3.
-Michael Bonini, Director of PennDOT's Public-Private Partnership (P3) Office
In order to finance a project of this magnitude, PennDOT chose to take a P3 approach, which allowed them to accelerate the repair and construction of these six bridges in critical need of replacement despite their dwindling resources in the face of growing needs. Much of the funding for this project will come from private activity bonds (PABs)—this project was the largest private activity bond (PAB) project in the United States to date, and it priced above par! In addition to the PABs, the project is also financed with equity in the form of mobilization and milestone payments and fixed interest earnings. S&B USA owns a 40% share.
The package will focus on six bridges: I-80 Canoe Creek, I-80 North Fork, I-78 Lenhartsville, I-80 Nescopeck Creek, I-80 over Lehigh River and I-81 Susquehanna. Ground was broke in the fall of 2023, and the construction phase should be completed by the summer of 2028. With decades of successful delivery on PennDOT projects, Fay—a member of the S&B USA family—is acting as one of the local construction subcontractors on this project.