SPECIAL REPORT: Clock ticking on Indiana Toll Road appeal

| 6/16/2006

The appeal of a preliminary motion in the constitutional challenge of the "Major Moves" plan in Indiana has moved along at an unprecedented pace so far, but only time will tell if it will be quick enough.

The appeal is in the hands of the Indiana Supreme Court, which heard oral arguments on Tuesday, June 13. If litigation is still pending June 28 when Gov. Mitch Daniels is scheduled to sign a $3.85 billion lease for the Indiana Toll Road, the investors from Spain and Australia have the right to walk away from the deal.

The constitutional challenge of the governor's transportation plan began two months ago, when a group of Indiana residents led by activist Steve Bonney, OOIDA Member Randy Nace and the Citizens Action Coalition filed a lawsuit April 12 in St. Joseph County.

The Indiana residents who filed the case contend revenue from the lease must be used to pay down public debt, as outlined in the state's Constitution. Daniels' plan calls for spending the money on 200 transportation projects around the state.

The defense, including Daniels and the Indiana Finance Authority, filed a motion claiming the lawsuit should be considered "public" under state code. And, because the Major Moves plan involves a lease and not a sale, they claim the state can disperse the revenue however it sees fit.

St. Joseph County Superior Court Judge Michael Scopelitis ruled in the state's favor on key points: he ruled that the Indiana Finance Authority is a municipal corporation and that the lawsuit should be considered public.

Judge Scopelitis then ordered the Indiana residents who filed the lawsuit to post a $1.9 billion bond if they wanted to continue to pursue the case.

However, the plaintiffs appealed, and the case ascended to the Indiana Supreme Court, bypassing the appellate court at the state's request.

Four justices of the five-member Indiana Supreme Court heard the case.

One justice, Justice Brent Dickson, recused himself without giving a public reason. If the justices vote 2-2 in the appeal, the lower court's ruling will stand.

The court took the appeal under advisement, with Chief Justice Randall T. Shepard promising a timely ruling. Shepard cited the timeliness of the case, pointing to the $3.85 billion Indiana Toll Road Lease.

The private investment group, Cintra-Macquarie, is scheduled on June 28 to complete a transfer of the $3.85 billion to the state.

Bonney, who spoke Friday, June 16 on Dave Nemo's show on XM Satellite Radio Channel 171, said the plaintiffs got involved because they opposed the idea of a long-term privatization deal for the state's short-term gains.

"It's a slide down the hill and it's a race to the bottom," Bonney said.

Bonney said he has heard of 23 states considering privatization of new and existing toll roads.

"If this (deal in Indiana) goes through, they will fall like dominoes," he said.

Bonney and the other plaintiffs are now awaiting the Indiana Supreme Court ruling on their appeal. Track their progress and their effort to fight the toll-road lease at majormoves.org.

- By David Tanner, staff writer