By Lyndsey Layton
After a year of exclusive and confidential negotiations, Virginia
hopes to turn over to a private partnership the $4 billion
project to build a rail line to Tysons Corner and Dulles International
It would be the first time a Metro segment was not built
by the public transit agency. Virginia officials call it an
innovative plan that would save tax dollars and set an example
for other transit projects across the country. Opponents say
it is a sole-source deal that would benefit Bechtel Corp.
and Washington Group International, which entered into a partnership
to build the rail line.
The stakes are high; the Dulles project is the third most
expensive rail proposal in the country, surpassed only by
two projects in Manhattan: a $17 billion plan to build a subway
along Second Avenue and a $5.2 billion plan to extend the
Long Island Rail Road from the East River to Grand Central
Metro officials are to discuss Virginia's unusual approach
to the project this morning, when the state will ask them
to agree to the deal with the partnership. Metro's consent
is needed because it would ultimately own and operate the
line. The state also wants Metro to act as a technical manager
to make sure the project is compatible with the rest of the
The project would extend Metrorail about 23 miles from West
Falls Church to Dulles. The work would be done in two phases,
with the first ending at Wiehle Avenue in Reston.
Although much of the recent public discussion about Dulles
rail has focused on how local governments would pay their
share, state officials have been holding confidential negotiations
with Dulles Transit Partners since January 2003. There is
no opportunity for public review until the deal is signed
and becomes binding.
Dulles Transit Partners is made up of Bechtel and Washington
Group. Until last month, the West Group, the largest landowner
in Tysons Corner, was also in the partnership. The state has
a draft agreement with Dulles Transit Partners for the firm
to perform preliminary engineering but wants approval from
the Federal Transit Administration before finalizing it.
Federal officials, who have never approved a similar deal,
have been studying the plan for months and hired outside expertise
to help. Federal Transit Administrator Jenna Dorn declined
to comment for this article.
The Dulles deal would add to the number of Virginia transportation
projects financed in part by the private sector. The state
enacted the Public-Private Transportation Act in 1995 to get
transportation projects built more quickly and efficiently
and to encourage private investment.
Virginia is a leader among states in striking deals with
companies to build road projects. Results have been mixed.
One of the first projects, the Dulles Greenway, was built
for $340 million by a private firm and has struggled financially
since its 1995 opening. The Greenway has never made a profit,
according to the General Accounting Office. But the state
did not have to pay anything toward the cost of the 14-mile
road and will eventually assume ownership. Motorists who use
it can cut travel time by 50 percent, according to its developers.
"Virginia made a conscious decision in the '90s to go
toward private participation. It was a political philosophy,"
said Steve Cohen, who co-wrote a recent study of public-private
funding of transportation projects for the GAO. "Governor
Warner embraced it and modified it, but it's something that
has roots in the state. It's unusual."
Typically, a company pays for a road or other improvement
and, in exchange, gets the right to collect toll revenue to
pay back its costs and make a profit. The Dulles project differs
because it is a transit project, and a private contractor
would not be able to recoup costs and make a profit by collecting
fares. In this case, the partnership agrees to build the project
at a "firm, fixed price" that includes a built-in
profit margin, said Karen Rae, director of the state's Department
of Rail and Public Transportation.
"They agree to build the project on time and on budget,"
Rae said. "That's the risk that haunts most of these
In the Dulles case, the public would provide the money for
the rail project. The federal government would pay 50 percent,
and state and local governments would pay the rest. The local
share would come from a special tax district in the Dulles
corridor and the state's share from tolls paid by motorists
who travel the Dulles Toll Road. The federal government has
not decided whether to fund the project.