Quack, quack: Monetization’s just a fancy word for privatization

| Friday, April 06, 2007

New Jersey Gov. Jon Corzine and top transportation officials are putting their own spin on terms used to describe the leasing of toll roads to private investors.

But trucking industry officials who claim long-term leases of highways are essentially sales say if it walks like a duck and talks like a duck, it’s a duck.

Corzine is on record as saying he will not “sell” the New Jersey Turnpike, Garden State Expressway or the state lottery to private investors.

He prefers using the term “monetization” to describe long-term leases of infrastructure and assets to private investors.

“Government folks are trying to put a positive ring on the sale of infrastructure – infrastructure we have already paid for,” Mike Joyce, OOIDA’s senior government affairs representative in Washington, DC, told Land Line.

“Privatization is monetization is privatization. It’s all one and the same.”

New Jersey State Department Transportation Commissioner Kris Kolluri and State Treasurer Bradley Abelow have been studying how much money long-term leases of the Turnpike and other assets might bring in to the state. They are scheduled to make a recommendation to Gov. Corzine in the next few weeks.

Joyce insists that any long-term lease that lasts decades – he gives 50 years as an arbitrary example – should be considered a sale.

“They’re twisting words,” Joyce said. “These supposed leaders in New Jersey need to call a spade a spade. It’s all about the sale of infrastructure.”

OOIDA officials have taken that stance since 2006, when Indiana Gov. Mitch Daniels successfully leased the Indiana Toll Road to private investors for $3.85 billion in cash. That lease will last 75 years.

“If you’ve lost control of something that lasts 75 years and the only way to regain control is to buy it back, then it’s a sale,” OOIDA Executive Vice President Todd Spencer told Land Line this week, reiterating a point he made back then.

New Jersey’s supposed need for a financial bail-out goes beyond highways. Corzine told The Star-Ledger that the state’s pension fund is also drastically under-funded, and he has proposed letting turnpike privatization revenue make up for the shortfalls.

New Jersey lawmakers critical of privatized infrastructure say DOT officials and the governor should proceed with caution with ideas of “monetization.”

– By David Tanner, staff writer
david_tanner@landlinemag.com

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