Pennsylvania governor on fast track to lease turnpike

| Thursday, April 17, 2008

Legislation that would enable Gov. Ed Rendell to lease the Pennsylvania Turnpike to private investors could be filed as early as the end of April, a governor’s office spokesman said.

Highway user groups have come out with guns blazing, saying that long-term private control of public roadways is bad for trucking, is bad for the economy, and would sell taxpayers short.

Governor’s office spokesman Barry Ciccocioppo said Rendell expects to have sponsors for the enabling legislation by the end of April.

“We expect legislation to be introduced this month so there is adequate time for the Legislature to take action before they recess for the summer,” Ciccocioppo told Land Line via e-mail. The Pennsylvania General Assembly is in session until June 30. They are scheduled to reconvene in the fall.

“There is not a certain date set yet to provide some flexibility for bidders to line up the best financing possible,” Ciccocioppo said, adding that bids received by the governor’s office would be binding through the end of the current legislative session.

Highway users including the Owner-Operator Independent Drivers Association are opposed to a long-term lease of the turnpike.

OOIDA officials have said that Rendell’s proposed lease is no better than the Act 44 legislation in July 2007 that enabled the Pennsylvania Turnpike Commission to seek authority to convert Interstate 80 into a toll road.

“Selling the Pennsylvania Turnpike – and yes, I’m using the term ‘selling’– is pawnshop mentality once again,” Mike Joyce, OOIDA senior government affairs representative, told Land Line.

“The parameters are similar to what (Indiana Gov.) Mitch Daniels put in place in 2006 when he sold the Indiana Toll Road.”

Joyce pointed out that Pennsylvania has the nation’s highest state diesel tax at 38.1 cents per gallon and the fourth-highest state gasoline tax at 31.2 cents per gallon.

“Yet businesses continue to leave the state,” Joyce said. “I wonder why.”

Privatizing the turnpike would lead to higher tolls for all vehicles. The private operator would be allowed to raise tolls 25 percent next year, and Rendell wants the lease agreement to contain minimum annual increases of 2.5 percent and be indexed to inflation.

Joyce said truckers in Pennsylvania should contact their state representatives and state senators and tell them to oppose the lease of the Pennsylvania Turnpike.

“Pennsylvania needs to go back to the drawing board and study how their money is spent first,” Joyce said.

An increasing number of states are looking for ways to generate transportation revenue. More than two dozen states have enabling legislation in place to lease infrastructure to the private sector.

A consortium from Spain and Australia leased the Chicago Skyway in 2005, paying Illinois $1.83 billion in cash for 99 years of control and operation.

The same consortium – Cintra Concessiones de Infraestructuras de Transporte, S.A., of Spain and Macquarie Infrastructure Group of Australia – leased the Indiana Toll Road for $3.85 billion in 2006. That 75-year lease will last until 2081.

Gov. Rendell’s proposal in Pennsylvania calls for leasing most of the state’s turnpike system to private investors for 75 years. The Southern Beltway and Mon-Fayette Expressway would not be leased, government officials stated in a document released Wednesday, April 15.

The U.S. Federal Highway Administration, based on 2005 legislation known as SAFETEA-LU, has several pilot programs to enable states to toll interstate highways.

Pennsylvania lawmakers approved Act 44 to clear the way for tolls on I-80, but an application filed by state officials to make that happen has not been approved by FHWA.

OOIDA’s Joyce said Gov. Rendell has played one plan against the other – I-80 tolls versus a turnpike lease – in order to sway lawmakers to generate a plan for increasing transportation revenue.

“He’s trying to put the cart before the horse,” Joyce said. “He’s trying to use these big dollar signs to get votes.”

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

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