Hawkins Construction Co. opened the 11-mile main alignment early this year. “There are two interchanges to complete and tie-ins to local county roads with roundabouts,” says Curt Mueting, NDOT District 1 construction engineer. “There’s just minor miscellaneous work after that.”

NDOT utilizes deferred contract payment certificates (DCPCs) that are issued to Hawkins and then sold to a special purpose vehicle (SPV), explains Chris Hawkins, the firm’s president and CEO. The SPV is a limited-liability entity which then sells DCPCs to a bond trustee.

The funds to purchase the DCPCs come from tax-exempt bonds via a conduit issuer, the Arizona Industrial Development Authority. NDOT then makes $7.5-million payments every quarter until the project is paid off. “The DCPCs will mature and NDOT pays the bond trustee, who then pays off the bonds,” says Hawkins.

Nebraska is a pay-as-you-go state and is prohibited from incurring debt. Typically, a large project would have been broken up into phases and built as funding became available. “For a state DOT with about $700 million or so a year to spend, a $350-million project was just too big a piece” without the finance model, notes Hawkins. Incremental construction would have taken over a decade before opening to through-traffic.

To prepare for its bond sale, the team had to account for such factors as materials inflation risks, interest accrual and the maximum amount to spend a month. “For each of the 36 months, we had to project an aggressive but accurate estimate of construction spend,” says Hawkins.

The pandemic threw a wrench into the process, as investors pulled $12 billion from the municipal bond market. “On the bond sale day, it was the single worst day in the market,” recalls Hawkins.

Hawkins worked with NDOT to achieve financial close a few days later. It rewrote the offering statement and seized upon a single day in April 2020 when the market was open to seal a $237-million deal that was rated Aa2 by Moody’s.

Earthy Endeavor

The need for the beltway dates back to the 1990s, says Tony Dirks, senior vice president with lead design consultant Benesch. The Build Nebraska Act of 2011 generated one-quarter of 1% percent of sales tax revenue to highway projects, and got the project moving. A $25-million federal grant followed in 2018.

“The primary objective is to get truck traffic out of town,” says Dirks. The greenfield project diverts trucks to the south of Lincoln off the current Highway 2 that runs through the city. Mueting notes that the alignment includes 14 miles of four-lane highway and 42 box culverts, along with 98 settlement areas and 7 million cu yd of earthwork.

The design team divided the project alignment into 20 soil survey areas, adds Brandon Desh, geotechnical group manager with Benesch. “We completed more than 300 borings and 2,000 lab tests during design.” Top layers of soils varied from thick zones of saturated, highly compressible alluvial clays to loess clay soils in upland areas. Underlying soils included glacial till, shale and Dakota formation, he adds. Potential soil settlements were as high as 20 minutes and as long as 500 days.

Hawkins is testing the CarbonCure technology (ENR 12/12-19/22, p. 14) on five miles of shoulder, adds Hawkins, to see if its rapid curing could accelerate future projects.

“Our success at the beltway proved the build-finance model works,” says Hawkins. “We have looked at airfield projects, water/wastewater plants, and corrections facilities as viable candidates.”