Los Angeles World Airports (LAWA) has extended the deadline for submission of financial proposals for its automated people mover (APM) project by three weeks, until mid-January. The delay is intended to give shortlisted bidders time to adjust their prices to reflect tax law changes signed into law by President Trump on Dec. 22. Proposals were originally due on Dec. 20, with a financial close and notice to proceed by year end.
LAWA is procuring the roughly $2.25-billion APM project through a DBFOM development agreement with a 25-year O&M leg that will be funded with milestone and availability payments AP) to the developer. Such deals are typically financed predominantly with debt.
The reduction in the corporate tax rate from 35% to 21% is expected to produce savings for LAWA. But limitations on the deductibility of interest will probably add to bidders’ costs and be passed on to LAWA.