Paving the way
The 22 states with statutes authorizing public-private road projects.
COLORADO In a $603 million, 99-year deal, the state’s Northwest Parkway Public Highway Authority agreed May 31 to lease the debt-plagued toll road to partners Brisa Auto-Estradas of Portugal and Companhia de Concessoes Rodoviarias of Brazil. The deal provides funding for a potential 2.3-mile extension to State Highway 128 in Broomfield. The lease agreement is expected to close Aug. 31, the authority says. Elsewhere in the state, two P3 projects are under consideration – the 200-plus-mile Prairie Falcon Expressway (formerly known as the Super Slab) and a Colorado Springs connector toll road.
FLORIDA A bill that would have allowed the Florida DOT to lease toll roads other than the Florida Turnpike to private companies died in the state House this year. A spokesman for Gov. Charlie Crist says the governor would consider any “options that would alleviate congestion,” including privatized roads.
ILLINOIS In a $1.8 billion deal in 2005, Chicago leased the Chicago Skyway for 99 years to Spanish-Australian consortium Cintra-Macquarie. Illinois has a joint plan with Indiana to build the Illiana Expressway, a southern bypass of greater Chicago connecting I-57 in Will County to I-80/90 and I-94 in Indiana near Michigan City. Whether this road could lead to a lease deal is not known. Talk among legislators notwithstanding, “the governor’s office has said they don’t support any privatization of the Illinois Tollway at this time,” says Illinois DOT spokeswoman Joelle McGinnis.
INDIANA Last year, Gov. Mitch Daniels got the legislature’s approval to lease the Indiana Toll Road to a foreign consortium for $3.8 billion to fund the Major Moves road-building effort. The 75-year lease is held by Statewide Mobility Partners, owned by Spanish-Australian consortium Cintra-Macquarie. More recently, Indiana and Illinois have moved toward building the Illiana Expressway, connecting I-94 and I-57 to bypass greater Chicago to the south.
MISSOURI The state has been considering P3s for some of its older Mississippi River bridges linking the state with Illinois. Partnerships with its neighbor are vital, considering the cost of the projects. A draft statewide 2008-2012 initiative eyes more than 700 improved or new bridges and roads statewide, costing $5 billion.
NEVADA Gov. Jim Gibbon this year created a 12-member panel to study P3s. Among its tasks: studying other states’ programs and identifying P3 candidates. Nevada’s DOT has plenty on its plate: a recently signed law provides roughly $1 billion for critically needed transportation projects.
NEW JERSEY Earlier this year, a state lawmaker suggested leasing the N.J. Turnpike and the Garden State Parkway for $15 billion to stem state debts. In his February budget address, Gov. Jon Corzine likewise floated the idea of public-private partnerships as a way to rid the state of debt. Other state assets under consideration include the lottery, public transit system and airspace, says Mark Perkiss, spokesman for the state Treasury Department. New Jersey ties to privatization might be closer than is apparent: The (Newark) Star-Ledger reported the state’s pension fund owns some $190 million in stock in the two foreign firms leasing the Indiana Toll Road and the Chicago Skyway.
NEW YORK Last year, then-Gov. George Pataki supported P3s, but met resistance from state legislators. Discussed projects include some of New York City’s oldest bridges. Current Gov. Eliot Spitzer has not publicly indicated his position on privatization of roads.
OHIO During the 2006 election, gubernatorial candidate Ken Blackwell, then secretary of state, proposed leasing the 240-mile Ohio Turnpike. His opponent, Ted Strickland, opposed the idea. Strickland won the race and still opposes privatizing that toll road, a spokesman says.
PENNSYLVANIA Gov. Ed Rendell wants to lease the Pennsylvania Turnpike to help pay for mass transit and the roughly $1.7 billion required annually to repair and maintain highways and bridges. A May report by investment firm Morgan Stanley proposes a $20 billion, 99-year lease on the 360-mile main line and northeast extensions, not the entire 537-mile highway. Critics argue that Morgan Stanley is hardly a disinterested adviser since it is profiting from privatization deals elsewhere. Rendell has received dozens of “expressions of interest” for leasing the turnpike, says Erik Arneson, a spokesman for Senate Majority Leader Dominic Pileggi. Firm proposals could come as early as this month, when the 2007-2008 budget is introduced.
TENNESSEE A bill authorizing the development of two toll projects passed the legislature in June, according to The Tennessean. One of the projects could bridge the Cumberland River three times. The bridges’ cost: $266.5 million. Yet, private companies would not be able to operate or collect tolls on either road. Gov. Phil Bredesen had not yet signed the bill as of press time, but a spokeswoman from his office says private tolling is “a prudent option for the state to consider in light of diminishing federal funds” to build highways.
TEXAS Gov. Rick Perry supports public-private toll roads, such as his proposed Trans-Texas Corridor network. Perry mostly got his way in the legislature this spring, as a much-debated “moratorium” on new projects passed with a host of exceptions allowing up to $20 billion in spending all over the state. Spanish company Cintra and Zachry Construction of San Antonio already have contracted to build and operate the southern 40 miles of Highway 130 from Austin to Sequin. As of press time, the state was considering competing bids – worth billions – from Cintra and the North Texas Tollway Authority to build a tolled highway north of Dallas.
VIRGINIA The state has leased the Pocahontas Parkway – a 9-mile toll road south of Richmond – to Australian company Transurban. The price: nearly $550 million for 99 years, including a promise to build a connector to the metro airport. Australian firm Macquarie Infrastructure Group is the majority owner of the 14-mile Dulles Greenway toll road. At least one state lawmaker has proposed privatizing the Chesapeake Bay Bridge, according to the Reason Foundation, a privatization advocate.