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Tuesday, September 23, 2014

Ind. Gov't. - "Toll Road bankruptcy reignites old debate about privatization"

Madeline Buckley reports today in the South Bend Tribune - here are a few quotes from the long story:

In filing for bankruptcy, the company that operates the Indiana Toll Road has reignited an old debate about the controversial privatization of the Toll Road in 2006.

Those who opposed leasing the highway in 2006 are now outspoken, citing concerns about the future of the road and quality of its upkeep.

Meanwhile, Indiana Gov. Mike Pence said in a statement Monday drivers of the route through northern Indiana can expect “business as usual.”

And U.S. Rep. Jackie Walorski said Monday the state included safeguards in the lease to protect the interests of taxpayers. Walorski voted for the lease when she served as a state representative. * * *

Indiana Finance Authority Director Kendra York said in a statement ITR Commission Co. will continue to manage the Toll Road through the bankruptcy process. The Finance Authority must also approve any potential sale of the lease.

“The IFA has been aware of negotiations between the operator and its lenders, so we anticipated this could be a possibility,” Pence said in the statement. “But Hoosiers can expect business as usual on the Indiana Toll Road.”

Back in 2006, Daniels touted the deal as a win for Indiana, comparing the lease to selling Manhattan for beads.

He said Indiana gets to pocket $3.8 billion, but could take back the Toll Road if the operator failed to meet demands.

Locally, though, the deal met with a lot of opposition.

A resident of LaPorte, Shaw Friedman said he sees substandard conditions when driving on the Toll Road.

“Frankly, the state should intervene as a party in the bankruptcy proceeding,” Friedman, an attorney in LaPorte County, said. “The state’s interests are certainly not represented by the hedge funds, banks and lien holders.”

Friedman said the former governor should be first in court to testify that he pledged the state would take back the Toll Road if the operator did not meet its obligations.

“This is a valuable asset that was really, really sold off at a discount when you consider the value the Toll Road could have had by gradually raising tolls,” Friedman said. “The problem is the $3.8 billion was gone in the first six or seven years. What do we do with the remaining 70 years?”

Politicians who opposed the lease in 2006 spoke out Monday.

Posted by Marcia Oddi on September 23, 2014 09:17 AM
Posted to Indiana Government