Virginia’s Chesapeake Bay Bridge and Tunnel Commission has decided not to pursue a P3 proposal to construct a new tunnel to parallel one of two existing subsurface structures along the 23-mile toll crossing between Virginia Beach and the Delmarva Peninsula.

Parallel Construction Consortium (PC2), led by Skanska Infrastructure Development, Inc., and Kiewit Development Company, Inc., had offered to develop, construct, and maintain a new parallel two-lane tunnel in the Thimble Shoals Channel, approximately 3.5 miles offshore from Virginia Beach.

Once ranked among ASCE’s “Seven Engineering Wonders of the Modern World,” the 50-year-old Bridge-Tunnel carries U.S. Route 13 across the mouth of the Chesapeake Bay, with the tunnels providing channels up to 100 feet deep for commercial and military vessels. Nearly 10,000 passenger vehicles and heavy trucks use the Bridge-Tunnel each day, with higher volumes during the summer tourist season.

Constructing a new tunnel at Thimble Shoals has been a goal of the Commission since parallel above-water segments to handle southbound traffic were completed in 1995 for $250 million. The Commission’s staff has spent the last several years familiarizing itself with P3s and design-build based project delivery methods in order to be better positioned for an accelerated construction program. Since January, the Commission has been assisted by a “strategic advisor” team lead by Moffat & Nichol, Long Beach, Cal.

PC2, which submitted its unsolicited proposal under Virginia’s Public-Private Transportation Act (PPTA) in November, also includes The Philip A. Shucet Co.; Weeks Marine, Inc.; Parsons Brinckerhoff, Inc.; and H.W. Lochner, Inc. PC2’s team members are also involved with the nearby Midtown Tunnel/Martin Luther King Freeway P3 project, which has repeated been criticized by local residents and legislators wary of the projects tolls and financing structure.

PC2’s proposal called for a four-year construction process beginning in 2016. While no construction cost was made public, PC2 noted an earlier $794 million estimate “does not fully reflect the full cost of construction.” Last summer, the Bridge-Tunnel Commission increased its toll rates to ensure adequate revenue to support the use of TIFIA loans and other innovative financing opportunities that would support an accelerated construction project.

Nevertheless, a Commission review panel recommended this past Tuesday that consideration of the PC2 proposal be terminated, citing an absence of competing proposals that might yield a more competitive construction price.

“Price competition is crucial for achieving a financially successful project,” the panel said in its resolution. Another concern was having PC2 responsible for maintaining only a key one-mile section of the entire Bridge-Tunnel complex. “The maintenance of the entire Facility should remain with one entity and not be split among separate organizations,” the panel said.

A parallel Thimble Shoals Tunnel is hardly dead in the water, however, as the review panel also recommended the Commission use a solicited design-build procurement process to move the project forward. There’s no word yet as to how and when the Commission will proceed.

Update 4/25/14: The Commission has issued separate RFPs for investment-grade traffic and revenue forecasts, and design manager/construction manager in order to advance the project as a design-build effort.