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Privatizing the Pennsylvania Pike

By David Tanner
staff writer

 

Gov. Ed Rendell wants to lease the Pennsylvania Turnpike to private investors by summer, and if his plan is approved by state lawmakers, an alternative proposal to convert Interstate 80 into a toll road will no longer be needed.

Rendell announced April 16 that bidders had until April 30 to submit offers for the turnpike. The deadline was extended to mid-May because no bids were received by April 30. A Rendell spokesman speculated that was because bidders didn’t want to tip their hands too early in the process. However, by May 9 “multiple bids” had been received.

Despite the governor’s strong preference for leasing the turnpike as a transportation revenue source, turnpike officials continue to pursue I-80 tolls.

Highway user groups including truckers are opposed to both proposals.

Pennsylvania already imposes the highest state tax on diesel in the nation at 38.1 cents per gallon and the fourth-highest state tax on gasoline, so it’s no wonder groups such as the Owner-Operator Independent Drivers Association oppose increasing out-of-pocket expenses for drivers in Pennsylvania.

 “Pennsylvania needs to go back to the drawing board and study how their money is spent first,” said Mike Joyce, OOIDA senior government affairs representative.

Rendell promotes lease idea

This is the second go-around for Rendell regarding a possible lease of the Pennsylvania Turnpike.

The governor first took his lease plan to the table in June 2006, but the Pennsylvania General Assembly failed to approve enabling legislation at that time.

Rendell worked on rounding up potential turnpike bidders throughout 2007. In April this year, he unveiled the terms he wanted to see written into a long-term lease. Rendell also asked the General Assembly to approve enabling legislation by its summer recess.

 “I-80 tolls will no longer be required,” Rendell stated in the terms document he floated to state lawmakers and potential bidders.

Rendell has said the winning bidder would control the turnpike for 75 years; be guaranteed a toll increase of 25 percent on Jan. 1, 2009; be required to bargain with union employees; and continue to abide by current agreements for police and emergency services.

Law still calls for I-80 tolls

Lacking the enabling legislation to lease the turnpike, Rendell and other state lawmakers put their heads together in July 2007 to push through funding legislation known as Act 44.

Act 44, which Rendell signed into law, transferred control of I-80 from the state Department of Transportation to the Pennsylvania Turnpike Commission for 50 years. It also authorized the commission to file an application in October 2007 seeking federal authority to convert the interstate into a toll road.

 “The important thing to understand is that Act 44 is still the law of the land in Pennsylvania,” Turnpike Commission Spokesman Bill Capone told Land Line.

 “We are still pursuing our application with the Federal Highway Administration for tolling I-80. We’re still moving forward as required by law, and still trying to do the work and planning necessary to meet the goal of having I-80 up and running as a toll road by mid-2010, regardless of what else is going on.

 “While this is going on, we’re still generating this revenue for the Commonwealth to fill the funding gap for Pennsylvania.”

FHWA officials tossed the application to toll I-80 back to the Turnpike Commission in December 2007 with about 15 questions or concerns. Capone said the commission was working on resubmitting its application to FHWA as early as mid-May.

 “We want to get it right,” he said.

Should Act 44 remain in place and I-80 tolls never materialize, the Turnpike Commission will still be required to pay $450 million per year to the state DOT.

If the Pennsylvania Turnpike is leased to private investors and Act 44 is repealed, I-80 tolls will not materialize and turnpike administrators could be looking for new jobs. LL

david_tanner@landlinemag.com

Aug/Sept Digital Edition