TOLLROADSnews

A Bloomberg news report says US "House Democrats are considering withholding highway funds from states whose (toll highway concession) leases with companies fail to meet proposed federal standards." Official spokesman for the Democrats at the House Transportation and Infrastructure Committee, Jim Berard, told us he cannot confirm or deny this report.

He says he doesn't know of any discussion of this kind but he can't rule it out. He says Bloomberg reporters may be "reading too much" into the letter to the Governors and the Position Paper, but "I wouldn't rule anything out."

He says the committee statements have been designed to get the state governments to "pause" and ask them to "look carefully" at the longterm commitments being made in toll  concessions.

This is intended, Berard said, to counterbalance what he called the one-sided cheerleader sounds coming out of USDOT.

The Bloomberg report referred to chairman James Oberstar's "proposed guidelines for private (tollroad) leasing agreements" stressing the need for "guarantees that states could upgrade parallel highways and protection against "price gouging by private companies."

The Bloomberg report adds: "States that did not comply would face the loss of federal highway funds."

Would this withholding of funds from bad concessioning states be written somehow into the next five year reauthorization, or would it be more immediate, as in annual highway appropriations, we asked House Democrat spokesman Jim Berard.

He says he doesn't know that the Committee has addressed how it would follow up.

Truckers said to be strongest opponents of concessions

The Bloomberg report says trucking interests and especially US Xpress Enterprises are the strongest political activists against toll concessions. This is because they see private operators as "more likely to raise tolls than government authorities."

The report quotes American Trucking Associations (ATA) chief executive Bill Graves as saying investors "have figured out how to make a lot of money" out of concessions and that the users are probably "going to pay exponentially."

Graves is quoted as saying truckers prefer higher taxes over increased tolls. (Polls show the general public favors tolls over taxes for new roads by two to one.)

ATA chairman and US Xpress president Patrick Quinn says private concessions will introduce the "unpredictable and the unknown" into toll rates.

That is perception perhaps. In fact government toll authorities are under fire for refusing to enter into commitments on toll rates:

• the Metropolitan Washington Airports Authority is negotiating to take over the Dulles Toll Road in Virginia without any of the constraints on toll setting agreed to by private proposers under concession submissions made to the state

• the NTTA public authority in Dallas proposal for SH121 tollroad has no restraints on its toll rate setting while toll caps are contractually binding on private concessionaires

• the Pennsylvania Turnpike Commission public-public proposal mentions an immediate 25% increase in tolls then indexed, while the Morgan Stanley draft concession for leasing the Turnpike has zero toll rate increase and indexing or GDP/capita annually, higher tolls under the public toll authority for many years

Rendell: Turnpike Commission "huge patronage bastion for both political parties"

The Bloomberg report contains the most outspoken attack yet by Pennsylvania Governor Ed Rendell on the state's Turnpike Commission saying most of the criticism of a lease concession comes from "entrenched interests  fearing the loss of what has been a 'huge patronage bastion for both political parties'."

Rendell scoffs at the notion of federal intervention against concessions, saying there will be lots more given the dire financial straits of the states. Rendell, like Mayor Richard Daley of Chicago who started the concession trend, is a Democrat.

TOLLROADSnews 2007-06-11

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