North Carolina Legislation Will Reallocate Costs of Cancelled I‐77 South Project

The costs of the dramatic cancellation of the I-77 South Express Lanes project in Charlotte last month are just starting to arrive. State budget legislation signed into law in early July will require the municipalities that voted to cancel the project to repay the state the more than $60 million it spent planning and procuring it.

Those municipalities are part of the Charlotte Regional Transportation Planning Organization (CRTPO), a Metropolitan Planning Organization for the Charlotte region. The CRTPO board, which includes representatives from Charlotte and other regional municipal or county governments, voted to rescind its approval of the I-77 South P3 in May, despite having approved the project more than a year earlier and the fact that the project was mid-procurement. Prior to its cancellation, the North Carolina Department of Transportation was planning to release a Request for Proposals for the project to shortlisted bid teams in June.

Now that they may have to actually pay some of the costs associated with their decision, some members of the I-77 South cancellation coalition appear to be reconsidering. The CRTPO is planning to revisit the project and hold another vote on it at its 23 September board meeting, just before an October 5 deadline for CRTPO members to reconsider. In fact, the structure of the reimbursement requirement ratchets incentives for holdouts as local CRTPO members reverse their decision, because it does not allocate the project’s costs to the CRTPO region as a whole but only to the specific municipalities that voted to cancel the project.

The I-77 South Express Lanes project was going to develop two barrier-separated, dynamically-tolled express lanes along 8.4 miles of I-77 from the South Carolina border north through Charlotte. There the system would interconnect with existing and operating express lanes from the I–77 North P3, which completed construction in 2019. The I-77 South project has been part of CRTPO’s long-term plans since 2014, but NCDOT has been considering, then planning, and then procuring the project as a P3 since a 2022 unsolicited proposal from I-77 Mobility Partners, the Cintra-led concessionaire currently operating the I-77 North Express Lanes. NCDOT would formally reject that proposal but studied and eventually recommended the potential P3 in 2024, and CRTPO approved the procurement that year.

Local news agencies have reported that some CRTPO members that voted for the cancellation in May, such as the city of Monroe, have reversed course in light of the budget legislation and now support the project.

Political support for the reimbursement requirement was mixed. According to The Charlotte Observer, North Carolina Governor Josh Stein, who signed the budget legislation into law, referred to the language as “wrong-headed threats of retribution against Charlotte…” in a statement.

A Multibillion Dollar Cancellation