Leasing the Turnpike: Questions & Answers

Commonwealth Foundation and Reason Foundation address common concerns
regarding a Public-Private Partnership on Pennsylvania’s toll road

HARRISBURG, PA — Today, the Commonwealth Foundation and the Los Angeles-based Reason Foundation released a policy brief entitled Leasing the Turnpike: Frequently Asked Questions and Answers to help enhance and enlighten the current transportation policy debate.

“With a $12.8 billion bid to lease and operate the Pennsylvania Turnpike for 75 years, many questions will need to be answered before the General Assembly and the general public can determine whether or not to accept the offer,” said Matthew Brouillette, president of the Commonwealth Foundation. “We obviously believe that a Public-Private Partnership on the Turnpike is better transportation policy than the current law, Act 44. But we understand that this is a new concept for most Pennsylvanians and they deserve answers to their genuine concerns.”

The policy brief asks and answers twenty-one of the most common questions related to Pennsylvania’s transportation funding needs and costs, current and proposed solutions, and the benefits of a Turnpike lease. The policy brief can be accessed at CommonwealthFoundation.org and at Reason.org.

“We welcome and encourage debate on this critical issue, and hope our policy brief adds to the discussion” said Len Gilroy, director of government reform at Reason Foundation. “We’ve found that the more people learn about the benefits of Public-Private Partnerships, the more inclined they are to embrace them. The legally binding contract between the state and the operator bring a level of openness, transparency and accountability that citizens and taxpayers don’t get anywhere else in government.”

The twenty-one questions and answers in the policy brief include:

  1. Does Pennsylvania need more money for its roads, highways, bridges and mass transit systems?
  2. Didn’t Act 44 of 2007—which will impose new tolls on the currently free Interstate-80—solve our transportation funding problem?
  3. What if the Federal Highway Administration rejects Pennsylvania’s application to toll I-80?
  4. What are the options available to policymakers for raising additional revenue for transportation projects?
  5. What is a Public-Private Partnership?
  6. What are the potential benefits of a Public-Private Partnership on the Turnpike?
  7. Aren’t Public-Private Partnerships, particularly leases of existing assets, new and unproven?
  8. Isn’t a 75-year lease to a private interest equivalent to the selling of a public asset? Isn’t 75 years far too long to lease a valuable road? The Commonwealth would be committing future generations when we cannot predict what the needs will be.
  9. Where does the value of the Turnpike come from?
  10. Isn’t public financing cheaper than private financing, thereby lowering the costs to taxpayers and toll-payers?
  11. Isn’t the Turnpike an efficiently run toll road?
  12. Wouldn’t a lease of Pennsylvania Turnpike just be a short-term fix with long-term problems?
  13. Why should the users of the Turnpike pay for the transportation costs of the rest of the state? Why not spread that burden to the users of I-80?
  14. Won’t the Governor and General Assembly misspend the billions of dollars from a lease deal?
  15. What if the private company breaches the contract or goes out of business?
  16. Won’t tolls skyrocket under a privately managed Turnpike?
  17. Won’t a private operator neglect the maintenance of the Turnpike to maximize profits?
  18. Won’t higher Turnpike tolls divert traffic to parallel roads?
  19. Isn’t it both a national security risk and bad economic policy to allow a foreign company to operate the Turnpike and send its profits elsewhere?
  20. Wouldn’t a Turnpike lease agreement include a “non-compete clause” giving the winning bidder protection from competition?
  21. Will Turnpike employees lose their jobs or see their wages and benefits cut?

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Editor’s Note: The policy brief, Leasing the Turnpike: Frequently Asked Questions and Answers, is available here.

The Commonwealth Foundation (www.CommonwealthFoundation.org) is an independent, non-profit public policy research and educational institute based in Harrisburg, PA.

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