Tom Warne Report, 25 May 2012
As Indiana winds down spending on the $3.8 billion received from the 2006 lease of the Indiana Toll Road, the state is looking at a series of new public-private partnerships which emphasize continued reliance on this financing method. With fortunate timing in the signing of the lease deal just after Gov. Mitch Daniels took office, the state was able to finance a ten year transportation plan without any bond issuance during his tenure. Daniels, a big supporter of public-private partnerships, will leave office in January but three major privatization deals are in the works.
The Indiana Department of Transportation has begun a P3 program for the state’s largest transportation projects, including the effort with Kentucky to build a new $2.4 billion bridge across the Ohio River. Also in the program are a major overhaul of a highway north of Indianapolis and a planned 47-mile expressway linking to Illinois.
“Indiana has tried to position itself as being innovative with regard to leveraging private capital for infrastructure,” INDOT spokesman Will Wingfield said. “It’s important in the current economic climate that Indiana makes it clear to the private sector that Indiana is open for business and interested in engaging in these types of innovative deals that help improve transportation for Hoosiers.”
Aside from $500 million placed in a trust fund, all of the $3.8 billion from the lease proceeds has been spent or identified for projects. INDOT has access to the interest earned by the trust fund every five years. The agency withdrew from those funds for the first time in 2011, spending about $120 million on different projects.