Delays on I-69 Construction Project and the Impact on Section 6 Land Acquisitions


July 24, 2017

Delays on I-69 Construction Project and the Impact on Section 6 Land Acquisitions

By: J. Eric Rochford, Eminent Domain Attorney

By now I’m sure all Hoosiers are well aware that the construction of I-69 Section 5 between Bloomington and Martinsville has been significantly delayed – by significant I’m referring to years, not months.  The primary design-build contractor and subcontractor for this section of the I-69 Project, I-69 Development Partners and Isolux Corsan, completely blundered the project and Isolux Corsan is now pending bankruptcy.  The big question for the property owners along the final portion of the I-69 Project, Section 6, is: what impact do the delays on Section 5 have on the timing for the land acquisition process for Section 6?

Each project section is independent of the other

The easy answer is, none.  At this point, the entire state of Indiana has a vested interest in finishing this project.  There have certainly been questions about how it will be financed.  Common sense would dictate that it will not be another P3 (public-private partnership), which was the source of financing on I-69 Section 5 –  however, officials of the Indiana Office of Management and Budget as well as the Indiana Finance Authority have said that P3 financing should not be ruled out.  Indiana’s lawmakers have indicated that they want the project to move forward on schedule and that those impacts on Section 5 construction bear no correlation to the future financing and timing of land acquisition for I-69 Section 6.  If anything, the best way to answer the question is that the delayed construction of Section 5 could have an impact on the beginning of construction for Section 6 – but the actual road construction occurs much later than land acquisition.

Construction delay creates uneasy feelings about land transfers

Another problem is the negative impact that a presumption of a delay in Section 6 land acquisition may have on those who own or may want to purchase property along the Section 6 corridor.  Effectively, every business or residential property owner on Section 6 has an even worse cloud of uncertainty over their property now that the State’s contractors and subcontractors screwed up construction of Section 5 so badly.  These properties have already been under a cloud of uncertainty since I-69 initially broke ground in Evansville as early as 2009.  Since then, buyers and sellers alike have been cautious about transactions involving land around State Road 37.  Residential property owners along Section 6 have struggled to sell their houses.  If they can sell them, they usually have to cut the price significantly to entice buyers.  Commercial property owners have struggled to sell properties and have struggled even more to retain tenants, extend existing leases or add tenants to vacant locations.  The causes of these struggles and tenants’ reluctance directly correlate with the uncertainty about the timing for Section 6 land acquisition and construction.  It’s only fair seeing what transpired on Section 5.

Thwarting the uncertainty over financing and partially relieving the uncertainty on properties along State Road 37, Governor Holcomb recently announced the state’s $4.7 billion road plan for numerous statewide projects, including I-69 Section 6.  This recent announcement sends the message to property owners along State Road 37 (or anyone looking to purchase land along that corridor) that the land acquisition process is coming very soon. More information about the I-69 Expansion project can be found here. Or contact me to discuss your concerns about land acquisition.

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