Nossaman LLP

Fredric W. Kessler

Partner

T 213.612.7829
F 213.612.7801
777 South Figueroa Street, 34th Floor
Los Angeles, CA 90017

A member of the Firm since 1978, Fredric Kessler is nationally recognized in the field of transportation public-private partnerships (PPPs); having pioneered the domestic application of international PPP best practices.  He offers his clients vast experience with innovative procurement, project delivery and financing methods, as well as negotiated agreements.  He is adept at structuring successful toll concessions, availability payment agreements and design-build contracts -- and advising on the strategic business decisions behind them.

The projects Mr. Kessler has helped to deliver have received numerous awards, including P3 Project of the Year (ARTBA, 2012), Co-Project of the Year (ARTBA, 2010), Global Transport Deal of the Year (Infrastructure Journal, 2009) and Transportation Deal of the Year (Project Finance, 2008).

In 2012, Mr. Kessler assisted U.S. Congressional staff with writing important changes in federal transportation law that improved and expanded federal credit assistance and tolling programs (MAP-21).  He regularly advises public agencies on the use of TIFIA funds and private activity bonds to finance their projects, and helps them prepare and submit letters of interest to the U.S. Department of Transportation.

Mr. Kessler is a lead or key attorney on Nossaman teams advising significant public agencies on the creation and implementation of their PPP programs involving multiple projects.  He has served in this capacity for clients such as the Texas Department of Transportation, Arizona Department of Transportation, California Department of Transportation, Washington State Department of Transportation and Los Angeles County Metropolitan Transportation Authority.

Mr. Kessler frequently speaks and writes about PPPs and transportation issues at leading industry conferences and in professional publications.  He also contributes his insights on recent industry developments to the Firm's Infra Insight blog.

Representative Work

  • Arizona Department of Transportation – PPP Program.  Lead attorney advising on development of ADOT's PPP program covering new toll facilities, managed lanes, transit and other transportation facilities, as well as other assets.  Role includes actively advising on legislative amendments, initial project screening and feasibility assessments and implementation of procurements for projects that prove feasible.  Projects under PPP procurement include:
    • South Mountain Freeway. Lead attorney advising ADOT on all aspects of a potential PPP procurement for this 22-mile, eight-lane greenfield project with an estimated capital cost of $1.8 billion.  His work includes assisting with risk allocations, a comparative quantitative and qualitative assessment of several project delivery alternatives, financial structuring including potential use of private activity bonds and a TIFIA loan, various other legal issues, and a Request for Information together with an industry forum.  He will be assisting with innovative procurement for the project in 2014 and 2015.  Construction is scheduled to begin in 2015 or 2016.
    • Flagstaff DMV Facilities.  Served as co-lead attorney advising on replacement of ADOT's Flagstaff DMV and maintenance facilities.  In a unique partnership with the City of Flagstaff, ADOT solicited proposals for a pre-development agreement to relocate and consolidate ADOT offices into built or existing facilities in exchange for the department's existing location – at no cost to ADOT.  A developer was selected in 2013.
    • Rest Area PPPs.  Served as co-lead attorney advising ADOT on this procurement and contract.  Fourteen Arizona rest areas are now being managed under one PPP contract.  The selected service provider is responsible for maintenance and operation of the rest areas and will also implement a sponsorship and advertising program to generate revenue.  The private operator will introduce amenities such as Wi-Fi access, dog-walking areas, charging stations for electric vehicles and ATM machines.  Under the contract, ADOT is guaranteed at least $1 million over the next 10 years from revenues generated from advertising and sponsorships.  That money will go into the State Highway Fund for other transportation projects.  The contract took effect in October 2013.
  • Texas Department of Transportation – Comprehensive Development Agreement.  Special counsel to TxDOT on its leading PPP program.  As an integral member of Nossaman's team of infrastructure attorneys assisting TxDOT, Mr. Kessler provides leadership and assistance with procurement, contract documents, concession agreements, design-build contracts, tolling services agreements, innovative financing arrangements (including applications to the federal TIFIA credit assistance program) and federal issues.

    Representative work for TxDOT includes:

    • North Tarrant Express.  Assisted with the procurement of a toll concession comprehensive development agreement and a pre-development agreement for this multi-phase managed lanes project in the Fort Worth area.  The toll concession agreement covers the first 13-mile, $2 billion managed lanes phase of the project, currently under construction.  His role also included assisting with the negotiation of a second toll concession agreement for the second phase of the project.  Phase 2 included a $1.5 billion ten-mile managed lanes expansion of Interstate 35W in north Fort Worth, one of the region's top priorities for congestion relief.
    • LBJ Express (I-635).  Assisted with the procurement of the comprehensive development agreement for this $2.8 billion, 17-mile express lanes project in Dallas.  State Highway 130, Segments 5 & 6 Toll Road. Developed and negotiated a long-term concession agreement to design, build, finance, operate and maintain a 90-mile, $1.3 billion toll road, which opened to traffic in 2013.
    • Tolling Service Agreements.  Assisted TxDOT with negotiation of various agreements with the North Texas Tollway Authority for tolling services and related collateral arrangements for TxDOT's projects in the region.   The NTTA provides tolling services in the Dallas-Fort Worth region.  This work includes agreements for back-office services for the North Tarrant Express, LBJ Express and DFW Connector projects, and a region-wide tolling services agreement for planned and future TxDOT managed lane projects.
  • California Department of Transportation – Presidio Parkway.  Key member of the legal team advising on the availability payment PPP agreement to design, build, finance, operate and maintain the project.  The $1.1 billion Presidio Parkway is a spectacular natural gateway connecting the Golden Gate Bridge with the City of San Francisco – traversing both an environmentally sensitive national park and a national historic landmark district. It is the first procurement initiated under California's new PPP law and only the third highway project developed through an availability payment PPP in the United States.  The project reached financial close in 2012 and is scheduled for completion in 2015.  Mr. Kessler prepared and advised on the procurement and contract documents, provided advice on structuring the financing and contract terms, and on application for TIFIA financing.  He assisted with negotiation of two amendments.

    In 2012, Presidio Parkway was named P3 Project of the Year by ARTBA.

  • Knik Arm Bridge and Toll Authority – Knik Arm Crossing.  Lead attorney on the team assisting KABATA on the structuring, formation and procurement of this approximately $850 million toll bridge and highway project.  The project will more efficiently link the Port of Anchorage with Point MacKenzie – currently 90 miles apart.  It includes a 1.75-mile bridge across the Knik Arm of the Cook Inlet and 18 miles of road to integrate the bridge into the region's transportation infrastructure. Originally intended as the first PPP transportation project proposed in Alaska, the state legislature reverted to a public financing and design-build model in 2014. Mr. Kessler assisted on all aspects of this project, including legislative issues, structuring of availability payments, structuring and planning to obtain an investment-grade credit rating for the project's debt, legal and commercial issues, procurement and contract documents, and TIFIA financing.
  • Washington State Department of Transportation – Tacoma Narrows.  Lead special counsel advising WSDOT on this project.  The Tacoma Narrows Bridge is a pair of twin suspension bridges that span the Tacoma Narrows strait of Puget Sound in Pierce County, Washington – connecting the City of Tacoma with the Kitsap Peninsula.  The first span was completed in 1950; the second span opened in 2007 as the country's first new suspension bridge in 30 years.  Mr. Kessler originally negotiated a comprehensive public-private agreement to privately finance, develop, operate and maintain the bridge.  Following pre-development work under this PPP and a state decision to publicly finance the project, Mr. Kessler negotiated and wrote a $615 million design-build contract to deliver the second span of the bridge and undertake seismic retrofitting of the existing bridge.  This award-winning project paved the way for a sophisticated design-build program which the Department continues to rely on for significant transportation capital improvement procurements.
  • Washington State Department of Transportation – Innovative Partnerships Program.  Key member of the team that negotiated five precedent-setting agreements for private financing and development of transportation infrastructure projects.  These projects addressed some of the State's largest and most pressing transportation needs, including planning for the SR 520 floating bridge replacement, park-and-ride lots on the I-5 for the Puget Sound region, and the Tacoma Narrows Bridge project.  Mr. Kessler's role included working closely with the client and other advisors to develop template agreements, while simultaneously negotiating and drafting individual PPP agreements.  The template comprehensive agreement was the progenitor of modern PPP agreements in use throughout the United States today.
  • Virginia Department of Transportation – Pocahontas Parkway (SH 895).  Advised VDOT on the original $353 million nonprofit corporation financing of the Pocahontas Parkway and the related design-build and long-term operations and maintenance contracts. The Parkway is an 8.8-mile bypass around the City of Richmond, Virginia, which includes the high-level Vietnam Veterans Memorial Bridge over the James River.  It was the state's first procurement under its PPP program.  Featured the region's first high-speed electronic tolling system, the Pocahontas Parkway opened in 2002.  In 2006, he advised VDOT on the long-term $611 million concession of the project to a private operator, which allowed the agency to recoup its investment, eliminate future liability and obtain a commitment to build and finance an extension to the Richmond airport, which opened in 2011.
  • Metro Gold Line Construction Authority – Gold Line LRT.  Special outside counsel in the joint development of parcels at four rail stations and the implementation of the Authority's fiber-optic leasing program.  The Authority undertook a program to generate revenues from station-site joint development and a fiber-optic transaction to support issuance of debt critical to financing rail transit construction.  Mr. Kessler's role involved preparing requests for proposals; negotiating site purchase, sale agreements and CC&Rs; and preparing detailed contract provisions on coordination with freight rail operations within the rail corridor.
Bio Photo
Bio Photo

Practices

Education

J.D., University of California, Hastings College of the Law, 1978, Order of the Coif

B.A., Wesleyan University, 1974, magna cum laude

Admissions

California

Professional Affiliations

Women's Transportation Seminar, Los Angeles Chapter

American, California and Los Angeles County Bar Associations, Real Property Sections

     
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