Public/Private Partnership for Roadside Rest Areas in California

In response to directives from the California Legislature, and its own desire to maximize limited resources, the California Department of Transportation (Caltrans) engaged Dornbusch Associates in series of projects between 1985 and 2008 to study the prospects, and develop a strategy and plan, for developing new safety roadside rest areas (SRRAs), and redevelop or replace existing SRRAs, through public/private partnerships. The new partnerships were conceived to capitalize on the financial returns available to commercial enterprises that might be included within the rest areas.

Dornbusch has identified the commercial potentials; the evolving legal, institutional, political, and economic opportunities and barriers to alternative joint development approaches; researched efforts in other states and countries to implement such projects; investigated the prospects at a number of candidate sites in California; and developed and tested strategic action and business plans for implementing public-private commercial rest area partnerships. The initial demonstration projects focused on the following sites:

  • Oak Hill and Bear Valley Interchanges on 1-15, San Bernardino County
  • Pollock Pines area on Highway 50, El Dorado County
  • Three Flags area on I-5, San Joaquin County, and
  • Rancho California area on 1-15, Riverside County

The Oak Hill site (at the confluence of I-15 and Rt. 395) was judged to be feasible, and Caltrans obtained competitive proposals and successfully negotiated a project contract at the site. Although ground was broken on schedule, the project stalled when the developer reported having difficulty obtaining construction financing. The developer was unsuccessful in renegotiating its agreement with Caltrans and the project was abandoned.

Dornbusch judged a second project to be feasible on I-8, east of El Centro in Imperial County, in which a joint development partnership would replace the existing Sand Hills Rest Area, which Caltrans determined to be operationally unsafe. Caltrans is currently in the process of implementing the project.

Encouraged by evident potential for the I-15/395 and I-8 projects, Caltrans engaged Dornbusch to investigate the feasibility of redeveloping some of its existing rest areas into joint public-private partnerships. Four such rest areas were determined to potentially meet the federal legal requirement of being located outside the highway right-of-way.

  •  Randolph Collier Rest Area – I-5 north of Yreka and south of the Oregon border
  •   Buckman Springs Rest Area – I-8 east of Pine Valley in San Diego County,
  • Wiley’s Well Rest Area – I-10 between Blythe and the Arizona border, and
  • C.H. Warlow Rest Area – Route 99 south of Fresno.

However, various obstacles blocked redevelopment of all of four sites.

Next, in response to unsolicited proposals, Caltrans engaged Dornbusch to investigate the prospects for commercial joint development rest areas at the following sites.

  • Yosemite Junction, at or near the intersection of Routes 120 and 108
  • Chiriaco Summit (I-10) to potentially replace the Cactus City SRRA
  • Hickman Ranch (Route 50)

Project potentials varied for the three, and all failed to proceed for different reasons.

However, in a 2007-2008 Caltrans project, Dornbusch’s research demonstrated significant changes in the legal and political environment and designed an implementation strategy and business plan that offered clear promise for a new concept of commercial rest area joint development. The new concept is based on recent federal legislation that would enable an “Oasis” designation to be granted to existing or planned truck stops and travel plazas that conformed to criteria prescribed for adequate and safe public services and appropriate commercial services. Dornbusch analyzed financial feasibility of the concept, demonstrating that it can entail little or no public investment, identified support for the new concept from previously opposing stakeholders and lobbyists, and obtained indications of likely project success based on the evidence of limited success in other states.

The new strategy was also designed to alleviate a significant and growing problem of unauthorized truck parking along interchange on/off ramps and access roads throughout the state.

Prospective sites were identified which would fill important gaps in the California rest area system, demonstrated an ability to meet the legal criteria for the new Oasis concept, and would accommodate stakeholder concerns. The sites include:

  • Merced County, I-5 near Gustine
  • Fresno County. I-5 near Three Rocks
  • Kings County, I-5 near South Dome
  • San Bernardino County, I-40 near Kelbaker
  • San Bernardino County, I-15 near Victorville (at or near the previous development site)
  • Imperial County, I-8 near Winterhaven (the site of the current project implementation)
  • Solano County, I-80 near Dixon
  • San Joaquin County, I-5 near Thornton

The Strategic Action Plan:

  • Recommends methods for taking advantage of the practical opportunities, while working within the legal constraints,
  • Addresses the trade-offs between State cost savings, partnership financial contributions, length of time Caltrans could  control the site for public use, and the relative ease and speed to implement the project, and
  • Recommends a procurement and contracting approach.

The Business Plan:

  •  Presents recommendations for appropriate types of organizations with which to partner and a division of development and management responsibilities between Caltrans and the private partner,
  •   Expands upon the contracting procurement approach recommended in the Strategic Action Plan,
    Recommends appropriate signing, marketing, and public outreach,
  •   Presents estimates of Caltrans’ cost savings for the public-private joint development relative to non-commercial SRRA development and operation at the candidate sites (both on-line and off-line), and
  •   Estimates Caltrans’ financial contribution, if any, to implement an Oasis SRRA partnerships at each of the sites.