Indiana has benefited from toll road lease
An anonymous comment on a recent post accused me of not mentioning the Indiana Toll Road deal because it was "not so good, a bad move". Of course, we have talked about the Indiana Toll Road lease many times on our blog, on our website, in legislative testimony, and so forth (see my reply for more), but it wasn't mentioned in the Wall Street Journal article I was summarizing.
But Len Gilroy of the Reason Foundation has a new commentary summarizing the benefits of the Indiana Toll Road deal:
In short, the lease payment is funding permanent assets to serve the needs of current and future Hoosiers. Further, the concessionaire has spent over $88 million in 2008 so far on construction contracts for work on the ITR itself. Over 97 percent of this work went to Indiana businesses, well exceeding the 90 percent target specified in the lease contract for the roughly $4 billion planned in ITR construction work over the 75-year term. That's $4 billion in addition to the $3.8 billion upfront payment that will remain in Indiana.
Without the toll road lease, these projects would likely have never materialized, or they would have necessitated tax increases to move forward. And Indiana has also earned over $360 million in interest on the upfront payment in just two years (over $185,000 per day, at current rates), which will be used to fund additional state and local transportation projects for decades.
This sort of wise fiscal stewardship was a key factor in Standard & Poor's recent decision to award Indiana its first-ever AAA bond rating in July, indicating top-notch financial conditions and management. Indiana's excellent credit rating means it will save millions of taxpayer dollars in interest payments when it issues bonds to fund capital construction projects and the like.
The Indianapolis Star got it right in a recent editorial, saying that the S&P rating "has validated several difficult, controversial decisions that Gov. Mitch Daniels and the General Assembly made to bring Indiana's budget back into balance. [...] [T]he $3.8 billion in capital leveraged through the [ITR] deal has enabled the state to make much-needed improvements in infrastructure while handing off management of an underperforming asset."
6 comments:
What a joke, you call your group bipartisan, yet you are showing only one side of the privatizaion buzz. See the following (the other gov. who is running, remember there are two sides to every story and election):
But Oxley also called the leasing of the Indiana Toll Road a disappointment for local governments who haven't benefited financially from the agreement as much as the state has.
If elected, Oxley said, the Democratic administration would appoint a bipartisan committee to review all privatization contracts.
From Jill Long Thompson's website.
You're right, I should have quoted Mitch Daniels' challenger criticizing Mitch Daniels to be fair and "bipartisan," rather than cite the research of another nonpartisan, independent think tank.
You caught us. We have been touting the success of the Chicago Skyway lease under Mayor Daley (D), working with the Rendell administration (also a D) to educate voters and lawmakers about the Pennsylvania Turnpike Lease proposal, and criticizing Sen. Joe Scarnati's (R) ties to the Turnpike Commission all because we want to help to Republican Mitch Daniels win re-election.
Of course I most offended that you think the Commonwealth Foundation would ever refer to itself as "bipartisan".
So you just "tout" when the issue is on your side? Because, everything else I read about Rendell on this site bashes him.
Hmmm... sounds like you just complimented us for being willing to praise when someone pursues good policy and criticize when they propose bad policy.
Not sure if that's bipartisan, nonpartisan, or just plain independent of the political machinations of Harrisburg.
In regards to the "issues", your group is very much to the right. So what if a Democrat proposed the lease idea, in case you forgot, many from the Rendell "family tree" made a lot of money off of just preping (Why was the House and Senate not included?)a lease proposal. Makes you wonder who would get rich off of the lease/sale of the Commonwealths' roadway? So indeed, there is much more corruption surrounding this lease. In addition, the basic issues here are: pro business or not; smaller or larger government input. This is textbook left vs right politics, learned in the fifth grade. You and your group represent nothing but "right" governmental solutions on all the trendy issues.
You've caught us, we "tout" free market solutions to public policies.
What did you do, read our mission statement, genius?
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