Pennsylvania Could Lease Turnpike in 75-Year Deal

May 19, 2008

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A Spanish company and a unit of Citigroup teamed up to submit the largest bid for the right to lease the Pennsylvania Turnpike for the next 75 years, but it's still up to the state Legislature to approve the deal.

Abertis Infraestructuras SA and Citigroup Inc. won the bidding with a cash offer of $12.8 billion. If the Legislature approves the contract to lease the Turnpike, the governor does not plan to pursue the tolling of I-80, which was called for in Act 44, passed last summer.

Governor Edward Rendell said that under the deal, "the turnpike will be upgraded and tolls will be no higher than the Turnpike Commission will charge. Where Pennsylvanians will see a major difference is on our other roads. Road repair all over the state will accelerate and we will be able to cancel the plan to impose tolls on Interstate 80." (Click here to read more on the governor's web site.)

According to published reports, the lease deal would let the private operator increase tolls by 25 percent in January, and in future years by either 2.5 percent or the consumer price index, whichever is greater.

The state's trucking group criticized the deal.

"The Pennsylvania Motor Truck Association is concerned with the current state of Pennsylvania's aging infrastructure, but the Governor's solution to effectively sell our Turnpike for 75 years does not meet the needs of the transportation community at large," said PMTA president Jim Runk in a statement released Monday. "We continue to advocate for viable, long-term alternatives that will put the public's best interest ahead of the for-profit drive of a private entity. We remain committed to pursuing an equitable solution and to discussing any and all options for solving this statewide problem."

"With the federal government planning to evaluate it on a national level in 2009, we should be leery of speeding forward with a plan that does not take federal solutions into account. If we bypass a thoughtful and transparent debate on how to best manage these necessary improvements, we risk punting the ramifications of a near-sighted solution to our children. We urge legislators to consider whether this proposed solution will truly improve travel for Pennsylvania motorists along our main artery."

The Turnpike Commission says it remains committed to Act 44. Act 44 provides more than $116 billion over a 50-year period for transportation maintenance and improvements in Pennsylvania by converting I-80 to a tolled facility, increasing existing mainline turnpike t tolls, and issuing Monetization Bonds based on future toll revenues.

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