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* From the AP…
Illinois may open the door to partnerships with private companies to save money on special road projects.
The private sector would enter what has been traditionally been a state role by helping to pay for construction and then sharing in any revenue - from tolls, for instance. […]
The bill would limit these partnerships to entirely new projects, not upgrades of existing roads.
* The Question: Do you support the concept of public-private partnerships to build new state toll roads? Take the poll and then explain your answer in comments, please.
posted by Rich Miller
Tuesday, May 17, 11 @ 6:01 am
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the law would need to be crafted in such a way to insure that the private company also had to escrow a certain amount of their revenues for maintaining the road. I voted no based on how it has not worked in other states such as CA.
Comment by pyrman Tuesday, May 17, 11 @ 6:24 am
I’m curious if people are voting “No” because they don’t like toll roads or because of the private partnership idea. Hmmm. Maybe I could’ve phrased it better.
Comment by Rich Miller Tuesday, May 17, 11 @ 6:42 am
I am fine with toll roads.
I voted “no” because the we have seen what reliance on corporate interests by governments can cause when it goes bad (see Harvard and Motorola, and Hoffman Estates and Sears). Why try that in regards to a critical infrastructure element such as raods?
If company A wants to get its name in the public eye, buy the naming rights to a building or a website. But not a tollway.
Comment by Mongo Tuesday, May 17, 11 @ 6:50 am
And end up with our politicians making the same kind of deals as the Daley/parking meter fiasco for a quick revenue boost? No.
Comment by Wensicia Tuesday, May 17, 11 @ 7:01 am
I love the public-private partnership idea.
Why not have the ‘big guns’ like Goldman Sachs and JP Morgan pony up to help Illinois out?
Comment by Leroy Tuesday, May 17, 11 @ 7:07 am
No. Private corporations are far better at crafting a deal that is far more to their advantage than that of the taxpayers.
Comment by Aldyth Tuesday, May 17, 11 @ 7:09 am
I’d be fine with it, if it were similar to the toll roads I’m familiar with like 355 and 294. Absent corruption of course, and with a healthy dose of transparency.
Comment by Southern Girl Tuesday, May 17, 11 @ 7:28 am
-Why not have the ‘big guns’ like Goldman Sachs and JP Morgan pony up to help Illinois out?-
Because when the ‘big guns’ have ‘ponied up’ in the past, the taxpayer gets screwed. A fund run by Morgan Stanley leased the parking meters in Chicago, after all. Private companies (rightfully) have a profit motive. Government does not. Therefore government can do things like infrastructure for less money and with better intention.
Comment by chi Tuesday, May 17, 11 @ 7:35 am
Ralph Nader offered an interestig idea several years ago - Develop a 20 year contract with a paving firm to keep a road maintained. The firm then has the incentive to use durable, long lasting methods for repairing the roads.
Currently, Asphalt is more expensive than concrete, but we are building new roads with Asphalt. This makes no sense. It’s as if Madigan is tied to the asphalt lobby or something.
Comment by Downstate Tuesday, May 17, 11 @ 8:08 am
“Because when the ‘big guns’ have ‘ponied up’ in the past, the taxpayer gets screwed. ”
Well, that isn’t exactly the ‘big guns’ fault, now is it? It takes two to tango in a ‘public-private partnership’
Although I do agree with you that when everyone sits down for a ‘public-private partnership’ meeting, the ‘public’ guys aren’t the smartest in the room…
Comment by Kilroy Tuesday, May 17, 11 @ 8:10 am
Private companies all too often seem accountable only to investors or owners’ profits. That’s not a bad thing, but in public works projects and infrastructure accountability should be to the public.
Comment by Observing Tuesday, May 17, 11 @ 8:20 am
This isnt being done already? That’s disappointing yet unsurprising.
Comment by Dirt Digger Tuesday, May 17, 11 @ 8:31 am
If things are run like they are in Ohio with their Turnpike Commission, then yes, but the devil is in the details. There is no reason that a properly constructed agreement between government and private entities cannot work to the benefit of both.
People rightfully bring up the parking deal in Chicago, which did not act to the benefit of Chicago taxpayers and visitors. However, blame seems to be solely on the business that entered into the agreement with the city, and instead does not center on the corrupt politicians that proposed the deal in the first place.
Comment by Cincinnatus Tuesday, May 17, 11 @ 8:35 am
Historically, this is how Illinois got its first bridges and improved roads. As Cincinnatus noted, the devil is in the details. Public-Private partnerships can work, particularly if they have more flexibility than required for regular public projects.
We can’t afford to ask the taxpayers to pay for everything we want.
Comment by Downstate Illinois Tuesday, May 17, 11 @ 8:41 am
You asked if we supported the *concept* and I, for one, do.
Sorry Chicago got screwed on parking meters (I just take the El and cabs when I visit), but that’s not the question.
When I lived in Tejas, I saw great examples of clean, well-run tollways, fairly and courteously managed. It can happen.
Comment by Ray del Camino Tuesday, May 17, 11 @ 8:45 am
Public-private partnerships represent the worst of both worlds. You get all the government corruption and inefficiency, plus on top of that you get to pay for investor profits.
Comment by PFK Tuesday, May 17, 11 @ 8:47 am
I voted yes. It could make a lot of sense for new construction of special service roads or bridges, for example.
The trick is to make sure the private entity has the funds for the long haul, and won’t walk away leaving the taxpayer holding the bag.
Comment by wordslinger Tuesday, May 17, 11 @ 8:50 am
I’m right with PFK. Some things really are inherently governmental and the government just needs to do a better job.
Comment by Excessively Rabid Tuesday, May 17, 11 @ 9:12 am
Yes. It’s a no brainer.
Comment by 4 percent Tuesday, May 17, 11 @ 9:13 am
No, no, and no. If a corporation wants a road built to further their fortunes, they should pay for it and maintain it themselves…the state can’t take care of the infrastructure it already has…could we have yet even more
welfare in this proposal corporate welfare proposed here?
Roads are a public thoroughfare people…America and it’s governments are their way to being a pawn in the great capitalistic experiment….
Comment by Loop Lady Tuesday, May 17, 11 @ 9:15 am
Notwithstanding Illinois penchant for questionable deals with the private sector, corporations and other private companies have a much better track record for efficiency and cost effectivness. Government on the other hand has no incentive to do things the most efficient way. Government has no profit motive to maintain.
Comment by Springfield Skeptic Tuesday, May 17, 11 @ 9:16 am
I actually like toll roads. They force drivers (like myself) to confront the cost of driving as you are driving — and with open tolls they no longer create traffic horror shows.
What I don’t like is public-private partnerships where the public bears the risk and the private entity pockets the profit. Although every new public-private partnership says, “Oh no, it’ll be different this time,” it never is.
– MrJM
Comment by MrJM Tuesday, May 17, 11 @ 9:21 am
New projects, in partnership with road builders, that the state cannot afford alone at this time, could benefit lots of communities and stimulate commerce.
Would like to be certain the gas tax revenue continues to support the old roads and bridges and is not disproportionately diverted to help the road builder contributors/partners.
Sounds like a possibility as long as local road construction companies are a part of the process. Would like to see a clause that helps the local road builders to participate. After all, we the taxpayer still shoulder a good part of the cost.
As was mentioned, the devil is in the details.
Comment by Justice Tuesday, May 17, 11 @ 9:26 am
I favor, with proper oversight. Hey, if they set the tolls too high or maintain it to crappy standards, no one will want to use it anyway. The main objective is to not saddle the taxpayers with a white elephant, so the deal must make financial sense from both a user and owner perspective. And we need private investment in lots of things now, like energy and communications as well as transportation.
Many of the nation’s railroads were built with mostly private money, but with government help in the form of land grants, etc. I believe the Illinois Central (now part of the Canadian National) was the first in the US to make use of this arrangement.
There were many private toll roads in the US, from its founding up until the early days of the automobile.
This is a moot point with the proposed Illiana highway…the legislation allowing private development has already been signed by Gov. Daniels and Gov. Quinn in each of their states, and the study is underway by IDOT and INDOT. It will be an interesting project to follow.
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 9:31 am
3P infrastructure funding arrangements have the blessing and encouragement of the FHWA. Here is the link to the FHWA web site: http://www.fhwa.dot.gov/ipd/p3/index.htm
I was involved in a project where a community constructed a new road on donated right of way. The project was funded using federal dollars as well as local agency bond funds. There would have been no way the project would have been built without the generous donation of the ROW. Granted, the property owner wanted to be able to develop the adjacent property and didn’t want to construct a $10 million road improvement. The community wants the sales and property tax revenue.
The way this project was structured, it was beneficial to all parties involved.
Given the sparse funding availability, the varied sources of money must be explored and used as necessary.
Any large roadway, such as the Illiana, that may involve a 3P funding arrangement will incur FHWA oversight.
Comment by Huh? Tuesday, May 17, 11 @ 9:50 am
Capt Fax we all know you are a loveable downstater with nearly no suburban experience so the “no” votes probably from people who reason we have the Tollways why bring in some corporation too? What roads will they build? About that is left in IL is slamming 355 through Lake County to WI. The court fight there will not be settled until we are headed to the dirt nap.
Maybe a private corp can build the Denny Hastert Expressway in weest nowhere. Make sure there is a full exit at his land.
Then what Illiana Truckers’ Path? — Tollway Authority
Chicago-Kansas City Expressway? —- Let the wealthy in Quincy foot the tab.
Seems like an unnecessary item and certainly one fraught with risk for those who easily succumb to
temptation
It is a lot like why Mayor Daley never really wanted a casino
Comment by CircularFiringSquad Tuesday, May 17, 11 @ 9:51 am
“Downstate Illinois - Historically, this is how Illinois got its first bridges and improved roads.”
I think that the way the 1920’s law was written, it a section of “hard road” was constructed by a local agency, the State took over jurisdiction and maintenance.
Comment by Huh? Tuesday, May 17, 11 @ 9:55 am
Bottom line: if we aren’t willing to raise gas tax to pay for needed roads and infratrucure, then we need to find revenue somewhere. Currently the Tollway provides excellent service at a reasonable price, but we saw how difficult it was for them to raise tolls to cover maintenance costs. (BTW, if one more person says the tolls were suppossed to be temporary, i’ll scream.) Private companies will be held to maitenance contracts that they’ll have to comply with or they’ll loose the road. Sure they’ll make money but the state will have well maintained infrastrucure that will fuel the economy in other ways. It should be patently obvious to everyone that the way we are maintaining infrastrucure now doesn’t work.
Comment by PJS Tuesday, May 17, 11 @ 9:59 am
What’s the point? The state, even in its current condition, is going to be able to borrow money more cheaply in the vast majority of situations than a private contractor. If we’re going to have tolls on roads, let them go entirely to the state to offset shortfalls in other transportation funding.
Comment by Angry Chicagoan Tuesday, May 17, 11 @ 10:01 am
The results of the rush to privatization we have witnessed are precisely the reason I voted no in the survey. Like any real world problem, the solution lies in controlling the costs of maintenance/construction and collecting the use taxes in the most efficient manner.
There is zero skill base within the governmental ranks to be able to structure, craft or negotiate such a deal in a manner that would be ‘fair’ to the people who built the asset in the first place.
Without beating a dead horse, the Chicago parking meter deal is either a spectacular failure in negotiation or a blatant program to enrich a select few.
Like any real world problem, the solution lies in controlling the costs of maintenance/construction and collecting the use taxes in the most efficient manner.
One thing that needs to be done quickly on both a local and national scale is to develop a process of collection of road maintenance funds that preserves the bias that larger/heavier vehicles pay more, but accounts for the increases in efficiency mandated by the CAFE standards as well as a complete lack of road use taxation for the fringe players such as electric, fuel cell, and other alternate fuel cars.
Comment by Plutocrat03 Tuesday, May 17, 11 @ 10:06 am
Maybe it’s the parking meter fiasco, but I am too leery of the private sector entering this domain. First, as MrJM and others point out, the private sector will see the reward while the public sector absorbs the risk. Second, a lot of people still don’t realize what was in the details of the parking meter lease. When a neighborhood group has a street festival, they are required to pay the parking meter company the full rate of parking for each spot eliminated from closing the street.
Third, what new tollway is needed? I’d rather see a public-private venture with CTA to rebuild/extend the Red Line or Blue Line and improve service. Do we really need new tollways in Illinois?
Finally, if there was a market for this, the private sector would be doing it now. They need the government to help create the market, which sort of turns the head on the myth of the unerring private market. Infrastructure is (believe it or not) one of things governments do best. These projects need to be scrutinized by the public benefit, not the benefit of investors.
Too many problems with this concept to get me on board. Too much experience with similar schemes to make me comfortable enriching another private group of investors.
Comment by 47th Ward Tuesday, May 17, 11 @ 10:11 am
@ PFK - 8:47am,
Public-private partnerships represent the worst of both worlds. You get all the government corruption and inefficiency, plus on top of that you get to pay for investor profits.
Equating gov’t corruption with business profits - just plain silly.
I also note someone said that if a business wants to build a road they should use their own money. Can they restrict the rest of us from using it?
I vote yes - we need to be creative in building/maintaining infrastructure. Gov’ts will always be here but businesses come and go. Making sure the maintenance funds are there is key - it’s what makes toll roads more appropriate.
Comment by dupage dan Tuesday, May 17, 11 @ 10:12 am
What I would further warn everyone about is the many cases in which toll roads have resulted in vast clear profits to the concessionaire and murky benefits at best to everyone else. We’ve got the 20-cents-a-mile 407ETR around Toronto, and even higher tolls on many routes in Mexico to take two examples of situations where private profit for concessionaires is everyone else’s headache. The reason the Illinois Tollway has been able to deliver basically good roads without digging into state gas tax revenues while maintaining some of the lowest tolls in the world is precisely because it’s a state agency.
I’m certainly willing to entertain tolls — although I prefer increases in the gas tax due to the implications for car use and energy conservation — but either way it should be a state-run mechanism.
Comment by Angry Chicagoan Tuesday, May 17, 11 @ 10:22 am
I wouldn’t trust the current administration’s partnership with any business.
Comment by Jechislo Tuesday, May 17, 11 @ 10:30 am
Why not, although with the caveat raised by pyrman @ 6:24 a.m.? If you don’t want to pay the toll, there’s always another route.
But with gasoline climbing ever upward as Peak Oil begins its economic bite, we don’t need more highways. We need to strengthen passenger rail and transit systems across the state. Do that, and we’ll be a lot better off than our neighbors who continue paving themselves into a dead-end.
Comment by Northsider Tuesday, May 17, 11 @ 10:39 am
Trying to figure it out. Private entity build the road and collects the toll. State retains the asset. How is maintenance of the asset to be funded?
Comment by Anon Tuesday, May 17, 11 @ 10:53 am
No, it opens the door to potential unethical conduct.
Comment by He Makes Ryan Look Like a Saint Tuesday, May 17, 11 @ 10:55 am
Private entity build the road and collects the toll. State retains the asset. How is maintenance of the asset to be funded?
It is written into the franchise agreement. Usually the responsibility of the operator to maintain a certain level of maintenance, which comes out of their toll revenues. Some deals even require expansion of the facility when/if traffic reaches a certain point.
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 11:00 am
Using examples of failed road programs in Canada and Mexico (Mexico? Really?) as a reason to say no to programs in Illinois is not useful - it may be useful as a primer on how not to do it, tho.
Comment by dupage dan Tuesday, May 17, 11 @ 11:03 am
Rich, My no vote was not against toll roads. Most of them do seem to be maintained better than regular interstates. Although I think the original idea that they would be toll roads until they were paid for kind of got lost in the shuffle. As is typical once our GA gets a revenue stream they are loathe to lose it.
My no vote was due to the fact that I wonder about the greater opportunities for corruption, skimming of monies, maintenance padding, and the giving of these possible lucrative contracts to “special friends”. I see it as another opportunity for corruption. I wonder what the savings would really be after oversight committees are set up etc. etc.
Comment by Irish Tuesday, May 17, 11 @ 11:14 am
Deals can be constructed to make private investors assume more of the risk. An example is the original structure of the Chicago Skyway deal.
For construction, the city issued bonds backed solely by anticipated Skyway revenues, no other city backing. Maintenance and safety requirements for the road as (get this) determined by the city got first dibs on the revenues with the bondholders taking second position.
There was a period of more than 20 years through the 70s and 90s when bondholders received no payments. All revenues were poured into the road. Bondholders howled, and there were lawsuits, but that was the risk assumed for their hoped-for rate of return.
When the city issued other debt, it would disclose the Skyway default, but the market yawned. That was a separate deal and other city bonds were judged on their security.
Comment by wordslinger Tuesday, May 17, 11 @ 11:15 am
Yes, but be required to devote and escrow a % of revenues (not profit) to maintenance to same standard as publicly funded toll-roads, and require actual and substantial equity from every partner so we avoid political-proxy partners cut in to get the bid.
Comment by Alexander cut the knot. Tuesday, May 17, 11 @ 11:19 am
Absolutely not!!! When the government builds a road, the fixed cost is…well fixed…there isn’t a rate of private profit demanded from future revenue streams. In addition, private companies intend to sell-out at some future date at what they plan to be a substantial profit, therefore there is constant pressure to raise revenue and skimp on expenses to maximize the future selling price.
Comment by Louis Howe Tuesday, May 17, 11 @ 11:20 am
There’s something incongruent about the ‘I’m willing to pay higher/more tolls for a highway’ vs. the ‘My taxes are too high’ statements that come up everyday. What’s the difference? Still more cash out of your pocket. As others have said the parking meters are such a blazing success. The idea sounds great but roads are the very type of projects the state should be doing and maintaining. Bringing in a private groups adds the cost of ROI for another partner. Who pays? Just more surcharges that get passed on to the taxpayer in a slightly different cost format.
Comment by zatoichi Tuesday, May 17, 11 @ 11:27 am
To all of you who feel this opens the door to unethical conduct…
Is there any instance where the “government” and “private business” should ever intertwine? They are inextricable now…defense contractors, transportation builders, consultants, subsidies and tax breaks to agriculture and industry, Medicare payments to private physicians and hospitals, etc.
It seems to me an entire severing of government’s relationship with the private sector would be in order if there is something inherently wrong with this public-private partnerships concept.
Transparent process, honest oversight and open, competitive bidding are today’s buzz words and should be part of any process, save a few that are necessary for national security. Otherwise, this would be like a multitude of other services where the government uses the private sector to achieve its objectives.
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 11:31 am
There’s something incongruent about the ‘I’m willing to pay higher/more tolls for a highway’ vs. the ‘My taxes are too high’ statements that come up everyday.
Not really. The first is a personal choice, the latter is a requirement of citizenship. I can either drive on Ogden Avenue or I-88 and pay, or not pay, the toll to get to the same place. I can’t refuse to pay my federal income taxes as long as I live in the US…however, I could move to the Cayman Islands.
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 11:36 am
The state has such a great record in this area I’m sure it would work out fine.
Comment by Liberty_First Tuesday, May 17, 11 @ 11:47 am
The private sector is already used to build and repair toll and non-toll roads. The private sector can effectively be used to perform distinctly defined maintenance and operations functions under contracts that have limited time-frames. However, long-term deals (leases) that effectively sell off public assets for short-term gain are irresponsible….there are just too many unknowns. Remember that an impetus for the nationwide interstate system was to facilitate movement of materials and personnel for defense; such assets should remain in the perpetual control of responsible government agencies. A good article an this general topic was published in GOVERNING, titled “Outsourcing Perversity” by John D. Donahue.
Comment by JustaJoe Tuesday, May 17, 11 @ 11:52 am
I said no. I still get mad when I have to pay $4 to park for 75 minutes on the street.
Comment by A Different Belle Tuesday, May 17, 11 @ 11:59 am
– Remember that an impetus for the nationwide interstate system was to facilitate movement of materials and personnel for defense; such assets should remain in the perpetual control of responsible government agencies. –
An impetus, certainly, but the economic benefits of a system of national superhighways had been talked about since the beginning of mass production of automobiles. The idea was the more efficient and timely delivery of goods, plus opening up mass expanses of the country for further development.
In fact, long before General Eisenhower famously admired the German Autobahn in 1945, Lt. Col Eisenhower participated as an Army observer in the Transcontinental Convoy along “The Lincoln Highway” from Washington, D.C. to San Francisco. The trip took 56 days, with most of the it from just outside Chicago through Nevada on unpaved roads.
Comment by wordslinger Tuesday, May 17, 11 @ 12:09 pm
Louis Howe said: there is constant pressure to raise revenue and skimp on expenses to maximize the future selling price.
I submit that there is an equal and opposite pressure to make the service affordable and enjoyable. Would you pay $10 a mile for the priviledge of driving on a bumpy road, when a non-tolled option was available 2 miles away?
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 12:21 pm
–Would you pay $10 a mile for the priviledge of driving on a bumpy road, when a non-tolled option was available 2 miles away?–
A major reason why the Skyway was in default for so many years was lost traffic — and tolls — after the completion of the free Boorman, Kingery, Calumet and Ryan expressways.
When those later became subject to (now constant) maintenance issues, the Skyway again became flush.
Comment by wordslinger Tuesday, May 17, 11 @ 12:27 pm
Interesting observations. It’s good that the public is becoming educated on this issue. Namely, that PPP doesn’t mean “free money.” Instead, it means a user fee system like the Tollway.
And since northern Illinois already has a Tollway, shouldn’t they be the ones building new toll roads (at least in the NE part of the state)? The Illinois Tollway runs well, is subject to public scrutiny, and already knows what it takes to build and maintain. Their rates are still ridiculously low, and even with a modest increase the region could use a few more tollroads (like western access to O’Hare, Route 53 extension, and the Illiana).
If new roads are required say, downstate, PPP seems to make a lot of sense. There’s no tollway downstate, and it seems unfair that northeastern Illinois already tolls, and still we send 65% of the road fund to build free roads south of I-80. We should consider tolling more of our interstates, while we are at it. So, no need for gas tax increase…just expand tolling.
Comment by phocion Tuesday, May 17, 11 @ 12:39 pm
I voted yes, feeling that properly structured PPPs can benefit all concerned.
- Everyone has a choice on toll roads: drive and pay, or don’t drive and thus don’t pay.
- Returns can be governed either by the upfront agreement, or by periodic review. Place them under some Toll Authority review, like ICC reviews utilities.
- Private entities understand that maintaining the asset is crucial to maintaining returns, thus the Skyway and other similar PPPs have generous maintenance budgets. Government only funds maintenance when there are funds available, or by political priorities, not by sound economic asset management.
- And to those who say government can do it cheaper, I can only say: “You’ve got to be kidding!”
PS. Local and state) government benefit from private roads because traffic will attract interchange development that yield sales and property tax.
PPS. Find a way to let road developers capture some of the adjoining land development and I bet you’ll find a formula to keep the tolls affordable.
Comment by anon sequitor Tuesday, May 17, 11 @ 12:43 pm
It’s sounds good to me if we did it on major hiways. It’s done all over Europe and So. America.
We should also expand it to include bridges, water treatment and parkland. Throw in high speed
monorail the more the merrier.Or let the boy’s in Springfield handle it. Now theirs a thought.
Comment by mokenavince Tuesday, May 17, 11 @ 12:48 pm
I voted no unless there are sunset provisions where after a period of time ownership becomes soley the State’s and and all toll revenue goes to the State
Comment by orlkon Tuesday, May 17, 11 @ 1:26 pm
@phocion: you’re exactly right!
Comment by PW Tuesday, May 17, 11 @ 1:30 pm
Would the private contracter be allowed to waive the requirements of Davis Bacon in order to build and maintain the roads? If so, we’d be in for some major cost savings.
Comment by Cincinnatus Tuesday, May 17, 11 @ 1:38 pm
I voted no. Those in support should be aware, if they are not, that privatization agreements for roads often include no-compete clauses. In order to protect the profits that the private entity seeks to make by investing in such a road, the agreement with government might limit government’s ability to improve or expand nearby free transportation. In other words, the toll road becomes the only way to efficiently get somewhere, and the user has to pay whatever price is charged. Or, one can just make the choice to take 3 hours to make a 1 hour trip. My source is here:
www.uspirg.org/road-report
Comment by TwoFeetThick Tuesday, May 17, 11 @ 2:00 pm
===It’s as if Madigan is tied to the asphalt lobby or something. ===
Historically in Illinois, the Dems were with concrete and the Repubs were with asphalt. 26 years of GOP governors, and voila, lots of asphalt.
Comment by Rich Miller Tuesday, May 17, 11 @ 2:17 pm
No. Private companies wouldn’t be willing to participate if they weren’t making a profit off of the deal, so why shouldn’t the state handle the project on its own and utilize that revenue and/or lower the cost to the public?
Comment by tired Tuesday, May 17, 11 @ 2:20 pm
I voted no unless there are sunset provisions where after a period of time ownership becomes soley the State’s and and all toll revenue goes to the State
Ownership of new facilities is almost always with the state to begin with. The private entity under the franchise invests their own money for the priviledge of building/operating/maintaining the facility (the land and physical assets are state property) and getting a financial return for a pre-determined term. At that point, the state could re-open competitive bids to run it for another term (most favorable proposal to the state wins) or run it itself. No assignment or sale of the lease w/o state approval, and state gets a cut if there is a profit involved in the transfer.
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 2:52 pm
–This makes no sense. It’s as if Madigan is tied to the asphalt lobby or something.–
You ever heard of a guy from Springfield named Bill Cellini, and the Illinois Asphalt Pavement Association? Some people say he’s been a pretty influential guy over the last 40 years or so.
I once made an IDOT flack (I can’t remember the name now) run down the whole Kool-aid canon as to why Illinois had to have asphalt while other states used concrete. The dude sweated bullets quoting studies about geology, freezing days, hot days, soil samples, etc.
It was a really mean thing for me to do.
Comment by wordslinger Tuesday, May 17, 11 @ 3:26 pm
Yes.
It will mean higher tolls, which are necessary to maintain and expand our roadways.
Comment by Yellow Dog Democrat Tuesday, May 17, 11 @ 3:46 pm
Alternately, someone could just make a $100 million contribution for the naming rights.
For example, how many folks can tell you who the Edens Expressway is named for?
An elected official? Nope — a Banker.
So why not sell the naming rights to another institution, or even a private individual?
Why not the Crown Expressway?
Comment by Yellow Dog Democrat Tuesday, May 17, 11 @ 3:50 pm
Wrodslinger,
I thought we moved to asphalt because of politician’s fear od RediMix Concrete Overshoes®
;-{)>
Comment by Cincinnatus Tuesday, May 17, 11 @ 3:50 pm
I’ll say this…this conversation has brought out a lot of compliments to the good folks at the IL Toll Authority. Usually all they hear about is Blago, John “Quarters” Boyle, Robert Hickman, and the roads that were supposed to be free after the bonds were paid. Lots of folks here seem to be favorable to the agency taking on more projects.
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 4:20 pm
The issue between asphalt vs concrete is two fold.
1. For a new improvement or a reconstructed roadway, the decision is made on the basis of a life cycle comparison & whether an intersection fits the defination of a a “high stress” (Lots of turning or stopping semi’s) intersection. More often than not, the life cycle cost analysis meant that asphalt was significantly cheaper.
2. For resurfacing or rehabilitating a road, it is faster to pave a road with asphalt than concrete. Traffic can be put on a partally build asphalt road while the same is not true of a concrete road.
Comment by Huh? Tuesday, May 17, 11 @ 4:37 pm
Howsabout Yellow Dog Drive?
Comment by dupage dan Tuesday, May 17, 11 @ 4:50 pm
“Third, what new tollway is needed? ”
Maybe make the Elgin-O’Hare actually go to Elgin, O’Hare, or both?
“What I don’t like is public-private partnerships where the public bears the risk and the private entity pockets the profit.”
Doesn’t have to be that way; it’s just a modified regulatory capture problem. If the “public” negotiator had some real incentive to press the best deal for the public, it might work better.
Take the EOH–the right of way is already there, and so is part of the highway. Dump all that into an entity, with the state having a 30/50/75 year reversion right. Sell the entity ($1, $10mm, I dunno) to the “private” entity, subject to the reversion and a raft of pre-defined operational and maintenance requirements, including when the road must be completed. Allow them to charge *any* toll they want, so long as the requirements are met (any, because they won’t make them too high to maximize revenue)–if the requirements aren’t met, road must be free/returns to state. The private company will almost certainly be able to construct and maintain the road at lower cost than the state, and will likely set variable tolls to maintain reasonably fast traffic flow to earn repeat business.
Comment by Chris Tuesday, May 17, 11 @ 5:00 pm
This is privatization, plain and simple. Cinci wants to use this to eliminate prevailing wage too. I think Vulture Capitalism is a better term for this kind of deal. I believe public works should be, you know, public.
What if the investment bankers think exits are too expensive and they want express service instead? Still a good idea?
Finally, does anyone else think this is what Mayor Daley and Son have in mind for their new “business” venture? Giving the Chinese and Saudis a safe place to park their billions?
Debate it all you want, but I’m not convinced there is much demand for any major new road projects, tollways or freeways, if gasoline stays above $4.
Comment by 47th Ward Tuesday, May 17, 11 @ 5:44 pm
@DuPage Dan -
Perhaps Caterpillar or Unlund Insurance would like to by the naming rights for I-155?
Comment by Yellow Dog Democrat Tuesday, May 17, 11 @ 6:10 pm
I’m not convinced there is much demand for any major new road projects, tollways or freeways, if gasoline stays above $4.
If this were true, the Dan Ryan and the Ike would have been free-flow today, and there would never be more than 1 or 2 cars at a red light. Many countries where gasoline is relatively more expensive than the US have well developed toll roads. China is building 1,000 new miles of highways a year. People will pay $ to not move in gridlock…time is money, worth more than $4 for a half hour’s worth of gas consumption to a lot of people, truckers included.
Not saying it’s the only solution by any means (I am a supporter of strategic public transit and high speed rail investment, too) but I think there’s a market there in locations where it makes travel and economic sense.
Comment by Six Degrees of Separation Tuesday, May 17, 11 @ 6:15 pm
“What if the investment bankers think exits are too expensive and they want express service instead? Still a good idea?”
So, you think they’ll build a road that no one wants to use? How do they make money then?
If there is sufficient demand at a high enough price for an express road with one exit in Lake Forest and the other in Oak Brook, that will at some future time revert to the public, at NO cost to anyone who doesn’t drive on it, what’s the problem? I seriously don’t get that objection.
Comment by Chris Tuesday, May 17, 11 @ 6:24 pm
===what’s the problem===
The problem is that by nature, a private entity will do what is best for its investors and shareholders, not what’s in the public’s best interest.
Of course, politicians in Illinois do not have a track record of always acting in the best interests of the public, but the theory is sound.
That’s my problem. These projects need to serve an interest that is higher than profit for investors.
Comment by 47th Ward Tuesday, May 17, 11 @ 7:06 pm
Arizona seems to have done it successfully.
Comment by Cal Skinner Tuesday, May 17, 11 @ 7:59 pm
Cal, it can be done, you just have to button it up so that the taxpayerrs aren’t hosed.
I don’t think there’s a great need for tollways, but there are a lot of places on the Mississippi where another bridge would open up opportunities for development.
For those who’ve never lived on the river, bridges are bread and butter, and the more the merrier.
Comment by wordslinger Tuesday, May 17, 11 @ 8:06 pm
Cal, have they even opened a toll road in Arizona? I think it’s early to call it a success, unless you mean it’s a success for the private interests involved.
I found this article in a quick Google search: http://www.tollroadsnews.com/node/5295
Sounds like they want a private company to build a by-pass around Boulder City, along the primary route from Phoenix to Vegas and the desert tourist areas. According to the article, the 20 mile by-pass won’t be built with any public money, but the taxpayers popped for a $240 million bridge to by-pass the Hoover Dam.
I’d call that investment a winner. But is that the best public policy? Why not include the bridge in the private sector cost?
The good people of Arizona are getting ripped off in this deal.
Comment by 47th Ward Tuesday, May 17, 11 @ 9:04 pm
More from that article:
“it has no intermediate interchange, so serves no local traffic.”
How would you like to own a restaurant or gas station in Boulder City?
The 15 mile stretch of new toll road is expected to cost investors $400 million to construct in exchange for the right to charge tolls on the thousands of tourists who drive around Boulder City to the free bridge that takes them on to Las Vegas, the Grand Canyon, Lake Mead, etc.
Can I be one of the investors?
Comment by 47th Ward Tuesday, May 17, 11 @ 9:12 pm
I see the potential for shake-down pay-to-play written all over this. So, I voted an emphatic no.
Comment by Marie Tuesday, May 17, 11 @ 11:53 pm
Adding: I’m about 3/4ths through David Ellis’s Breach of Trust, so I see shake-down everywhere these day.
Comment by Marie Tuesday, May 17, 11 @ 11:57 pm
“That’s my problem. These projects need to serve an interest that is higher than profit for investors. ”
IF (yeah, big if) ALL the funding is from private sources, and the state gets the asset at the end of the franchise term, what’s the problem?
I understand that you don’t believe that’s the way it will work–but that’s a politician problem, not an inherent flaw in the concept. And, FTR, I agree that–especially in Illinois–that the concept would most likely get FUBAR, b/c of politicians. But that’s not *necessarily* true, and acting as if it is inevitable allows the politicians off the hook.
Comment by Chris Wednesday, May 18, 11 @ 12:13 am