SPECIAL REPORT: Indiana Toll Road bill moves forward

| 2/23/2006

The Indiana Senate Appropriations Committee approved a bill 8-4 Thursday, Feb. 23, along party lines that would authorize Gov. Mitch Daniels to lease the Indiana Toll Road to a foreign group for nearly $4 billion.

The bill now heads to the full Senate for further debate, where Senate Appropriations Chairman Robert Meeks, R-LaGrange, said he is confident it will pass given the strong majority status in the chamber. The full Senate could vote in it as early as next week.

Prior to the committee vote, lawmakers made several changes to the bill, which authorizes a 75-year lease of the 157-mile toll route to a Spanish-Australian consortium.

The leasing plan is the biggest chunk of the Republican governor's 10-year, $10.6 billion statewide construction plan, which he calls "Major Moves."

Among the modifications to the bill is a provision that would require legislative approval of any future public-private partnerships to toll existing or planned highways. Daniels has said he wants to make a planned extension of Interstate 69 from Indianapolis to Evansville a private toll road.

Another change would set aside $400 million in a trust fund that could not be tapped until its balance reaches $1 billion. At that time, interest from the fund could be used to help pay for highway projects beyond the state's 10-year transportation plan, The Associated Press reported.

Another change would allow annual tax credits for tolls incurred by many Indiana residents. It would allot for a maximum annual credit of $300 for residents who file an individual income tax return during the next decade. The tax credit would not be available to small-business truckers.

Dropped from the bill was a provision that would place a 10-year freeze on tolls for passenger vehicles that belong to residents who live in counties that the Indiana Toll Road goes through.

The Senate committee was concerned unequal pricing would violate the interstate commerce clause of the U.S. Constitution.

"It's unconstitutional to (freeze tolls). There's no way to regulate that," Meeks told Land Line prior to the vote.

Macquarie Infrastructure Group of Sydney, Australia, and the Cintra firm, based in Madrid, Spain, bid to lease the toll road for $3.85 billion. The bid needs approval from the state's Legislature to be completed.

In the next decade, supporters said the lease would cover a gap of $2.8 billion needed for road and bridge work throughout the state. The seven Indiana Toll Road counties would receive 34 percent of net proceeds from the deal.

Lawmakers forwarded the bill to the full Senate despite seemingly wide opposition from various organizations and the public.

A big point of contention for opponents is the logic and fiscal sense of giving up a state asset such as the toll road - and its revenue stream - for 75 years in exchange for a decade-long road program.

Sen. Vi Simpson, D-Bloomington, told "Land Line Now" that the deal was done so that the governor could dangle $3 billion in front of the faces of the legislature and say, take it or leave it.

Others expressed concern about the precedent it would set for allowing the governor to privatize any road or bridge in the state.

Undeterred from public sentiment, Chuck Schalliol, budget chief to the governor and chair of the commission operating the toll road, told "Land Line Now" after the vote that the panel's amendments are a good step toward finalizing the legislation.

"I think there's more work to do . but this is a very important step," Schalliol said.

If the leasing bill is approved by the full Senate, where a vote is expected next week, it would head back to the House to sign off on changes before it heads to the governor's desk.

If an agreement cannot be reached by the General Assembly, a conference committee would be formed with select members from both chambers meeting to hammer out a compromise version of the legislation before the session ends in mid March.

- By Keith Goble, state legislative editor
Staff writers Reed Black and Mike Throop contributed to this report.