Drink the Kool-Aid: DOT holds PPP summit

| Friday, February 08, 2008

The U.S. Department of Transportation held its fourth annual summit this week aimed at bringing local, state and federal officials together with private investors to talk about public-private partnerships.

Public-private partnerships, or “PPPs” as they are sometimes referred, are best explained through example.

Immediately coming to mind is the Indiana Toll Road, leased by Gov. Mitch Daniels to investors from Spain and Australia for $3.85 billion in upfront cash. Indiana officials promised to re-invest the cash in 200 transportation projects around the state. In return, the private investors are scheduled to collect and keep all tolls on the road until the year 2081.

An example of a different kind of PPP is the construction of the South Bay Expressway near San Diego which was built from scratch as a toll road by investors who will keep future toll revenue to recoup their costs.

The DOT summit Tuesday, Feb. 5 and Wednesday, Feb. 6, in Washington, DC, featured more than 50 speakers.

U.S. Transportation Secretary Mary Peters was scheduled as the keynote speaker but another DOT representative spoke in her place. Peters is among those who are heavily promoting private investment in U.S. infrastructure.

Leaders with the Owner-Operator Independent Drivers Association scrutinize many of the PPP deals that have been transacted in the past few years.

OOIDA’s Mike Joyce, associate director of government affairs, attended several of the speeches including an address by Tyler Duvall, assistant secretary for transportation policy for the U.S. DOT.

“These tend to be cheerleading sessions,” Joyce told Land Line. “It’s a big cheering session for PPPs, tolling and privatization. They try to get state officials to attend and they try to get them to drink the Kool-Aid and tell them their solution to transportation problems is tolling, congestion pricing, and public-private partnerships.”

The vast majority of speakers at the summit were pro-PPP, but not all.

U.S. Rep. James Oberstar, D-MN, chairs the House Committee on Transportation and Infrastructure. He has spoken out regularly against the dangers of turning over U.S. infrastructure to private investors.

Oberstar did not attend the summit, but the House committee’s policy director, Art Chan, presented Oberstar’s prepared comments.

“We need to be very careful when privatizing public assets,” Oberstar wrote. “Private businesses have objectives and motivations that may not align with the public interest.  The public partner has a duty to ensure that the public interest is best served under any agreements into which it enters.”

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

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