Congressional Democrats may introduce legislation that could punish states for leasing toll roads, a move that could throw cold water on public private partnerships and private equity infrastructure investment.

Last week the US House of Representatives Highways and Transit Subcommittee published a report outlining concerns over public private partnerships. The report is in favour of states forging relationships with financial institutions such as private equity firms, but cautions against charging “excessive tolls” and providing “excessive profits” to such companies.

The report calls for withholding highway funds from states which offer lease deals with companies that fail to meet proposed federal standards.

The US market for infrastructure investments has been heating up over the past two years. In 2005 the 99-year lease for the Chicago Skyway, an eight mile toll road, was sold to Australian bank Macquarie and Spanish toll road firm Cintra for $1.8bn (€1.3bn). Last year Indiana sold a 75-year lease for its 157-mile turnpike to the consortium for $3.8bn.

Pennsylvania is considering a recommendation from Morgan Stanley to lease its turnpike which the bank estimated could be worth up to $3.6bn for a 30-year lease and up to $20bn for a 99-year lease.

Goldman Sachs has raised $6.5bn for its infrastructure fund while Credit Suisse established its first $1bn infrastructure fund in July last year. Last month, Citigroup's alternative investment arm launched its first infrastructure fund Citi Infrastructure Investors. It wants to raise $3bn for investments which could include toll roads.

Spokesmen for Macquarie Infrastructure Fund and Goldman Sachs declined to comment.

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