Indiana has managed to close a large part of its deficit by leasing control of the Indiana Toll Road to a private company, Statewide Mobility Partners, for the next 75 years in exchange for the lump sum payment of $3.85 billion. That’s more than three times the amount the state would generate if it operated the toll road by itself during the same time period, according to the U.S. Office of Management and Budget.
“We will deposit this astonishing sum, equaling more than a decade of new construction funding at the current level, into a trust fund, to be invested as fast as legally and humanly possible in the biggest building program in state history,” Gov. Mitch Daniels said in a statement released Monday, Jan. 23. “At last, we can stop dreaming and start digging.” The governor’s office is calling this is the largest public-private partnership in American history.
Statewide Mobility is comprised of the Macquarie Infrastructure Group of Australia and Cintra Concessions de Infraestructuras de Transport S.A. of Spain. Statewide Mobility operates more than 30 toll roads on five continents. It leased the Chicago Skyway in 2004 for $1.83 billion. The takeover is part of Daniels’ Major Moves initiative, a $10.6 billion transportation plan designed to double new construction spending on state projects in the next decade. “A state that aspires to greatness has to think big and act boldly. That’s the kind of state we want Indiana to be,” Daniels said.
Of the $3.85 billion lump sum, the Major Moves Construction Fund will get $2.5 billion. Another $1.3 billion will go to the Toll Road counties, while $150 million will go to cities and towns in the next three years for road and bridge needs. In addition to the lump sum, Statewide Mobility will make improvements valued at $4.4 billion to the toll road throughout the lease. This will amount to more than $200 million in the next three years alone. These improvements include electronic tolling, a new state police post and upgrades to the Toll Road itself. Daniels said the toll road would be “better maintained, better patrolled, with better technology than the state could ever provide.”
Besides the toll bidding, more than 30 funding options have been reviewed by the Indiana Department of Transportation. Some already are being implemented; for example, saving money through project redesign and higher special permit fees. Daniels also has proposed adding tolls to I-69 between Indianapolis and Evansville. “Without new approaches that stretch dollars and access new funding sources, only a fraction of these projects will happen within the next decade,” Daniels said. “Some will never happen.” Daniels has said he will not, however, recommend a gas tax increase.
Besides bidding off control of the toll roads to generate revenue, the governor’s plan includes:
“We envision an Indiana with a reborn Northwest corner, with new means of mobility for both goods and people, with intermodal ports and a major airport serving not just our state but our neighbors,” Daniels said. “We intend a modernized, state-of-the-art East-West Toll Road, and a full complement of connecting secondary roads across the northern tier of our state.”