Indiana Finance Authority board OKs cancellation of I-69 contract for Section 5

The Indiana Finance Authority board approved a resolution Thursday to terminate the contractual relationship between I-69 Development Partners and the state of Indiana, according to a news release from the finance authority. The resolution also calls for the Indiana Department of Transportation to take direct control of the project, and for a $246 million bondholder reimbursement. That money is expected to come from the sale of new bonds to be issued this summer.

The next step in the process is for Indiana’s State Budget Committee to review the plan. Final closing is expected after the review is completed and the agreement is signed by all parties. According to the news release, the state plans to take full control of the project this summer.

The Indiana Finance Authority announced plans for the state takeover earlier this month after several extensions to the substantial completion date and multiple downgrades of the bonds used to help finance the project.

I-69 Development Partners submitted the winning bid of $325 million in 2014 to convert 21 miles of Ind. 37 from Bloomington to Martinsville to I-69. As part of the agreement, the private company formed specifically for the Section 5 project also would finance construction as well as maintain and operate that portion of the interstate for 35 years. In return, the state would make annual “availability payments” of more than $20 million to I-69 Development Partners during its 35 years of interstate operation and maintenance.