Media
Turnpike Commission’s version of MiniTru
- “I’ve got a bridge you might want to buy.” Carson doesn’t own the Brooklyn Bridge. Comparing a lease of the Pennsylvania Turnpike, approved by the General Assembly, to a fake sale of the Brooklyn Bridge wouldn’t fool a fifth-grader.
- “This law was crafted by Gov. Ed Rendell and the General Assembly after months of study and debate. Lawmakers looked at many alternatives.” False. Act 44 was created by a gut-and-replace amendment on the floor of the House, then amended by Senate leadership – it did not go through the committee process. There were no hearings on Act 44. The only study of tolling I-80 concluded that it should not be tolled. The Turnpike Commission claims to have an analysis of I-80 tolling conducted by Citibank, but refuses to release it publicly.
- “Act 44 generates enough funding to satisfy the needs identified by the Governor’s Transportation Funding and Reform Commission, which cited a $1.7 billion annual gap in funding for our transportation systems. … the Turnpike will provide PennDOT with direct payments averaging $1.67 billion annually over the next 50 years.”
Act 44 will pay $1.7 billion – in 2036. The Transportation Funding and Reform Commission didn’t suggest we needed $1.7 billion in 30 years, but now. Act 44 provides only $750 million this year, and won’t provide $1 billion until 2015. Furthermore, given historic inflation rates, $1.7 billion in 2037 will only be worth about $500 million today.
If the federal government rejects I-80 tolling, then Act 44 will yield only $450 million – one-fourth the identified need.
- “No private conglomerate (foreign or domestic) can raise these amounts under comparable financial assumptions.” Prove It. Open up the Turnpike and I-80 for competitive bidding – if the Turnpike Commission/Act 44 is the best deal, it will win. But the Morgan-Stanley report suggests that a Turnpike lease could generate twice as much, as did Governor Rendell on CNBC. A Turnpike lease may generate three times Act 44’s revenue. And that is without tolling I-80 – competitive bidding of both toll roads should generate four to six times what Act 44 does.
- “The Turnpike will incur debt under Act 44 but there is a critical difference: The interest on our debt is free from federal and state income tax. That means it will carry a much lower interest rate than the debt incurred by a private investor.”
- The Nov. 14 op-ed took our management to task with irresponsible and unsubstantiated allegations.” Substantiatiated:
So What? Debt by the Turnpike Commission is owed by taxpayers, debt by a private operator is not. This argument is akin to saying the Turnpike Commission should buy me a new house, because it can get lower interest rates than I can. Under a lease, Taxpayers are on the hook for $0 in debt – all risk is on the hands of the private investors.