I have a photo from 1956 of a truck making its way through a Kansas Turnpike toll plaza. The truck, emblazoned with the Graves Trucking logo, belonged to my father's company.
As it turns out, 1956 was the year the Kansas Turnpike opened. The project predated the Federal-Aid Highway Act President Dwight D. Eisenhower's historic initiative. In those days a toll road was one of very few options available to states to build a freeway. Fifty years later toll roads are surging in popularity, but as a quick fix for state financial woes.
With state budget shortfalls and a general unwillingness to raise taxes, state politicians are flocking to private investors for the highway equivalent of the payday loan. In 2005, Chicago leased I-90 to the Australian Macquarie Infrastructure Group and Spanish Cintra for $1.83 billion to pay off city debt and fund non-transportation projects. In 2006, Indiana leased the Indiana Toll Road to the same firms for $3.85 billion. Gov. Ed Rendell recently asked for expressions of interest to lease the Pennsylvania Turnpike for as much as $16 billion.
Other deals are in the works. It is easy to see why politicians are tempted by this new scheme. The nation's highway system needs to grow and be maintained, but states are facing crushing debt loads. Funds to relieve these problems must come from somewhere.
But the United States cannot maintain a national highway network if key segments are leased to the highest bidder. More than money is at stake. Leasing roadways allows states only to postpone, not solve, their budget problems, and without understanding the long-term implications.
Privatization is dismantling the nation's interstate highway network. It's happening with the support and encouragement of the U.S. Department of Transportation and, until recently, without congressional review.
Alternatives exist. Since the interstate system's inception, fuel taxes have foot the bill. Trucking pays nearly $15 billion in highway user fees annually to the $35 billion Federal Highway Trust Fund. Fuel taxes can be uniformly administered, are based on verifiable measures of highway and vehicle use, are relatively simple to collect, not readily evaded, and do not create impediments to interstate commerce.
Privatization, on the other hand, lets operators increase tolls rapidly, robs the public of a degree of control, and does not guarantee service and safety levels. A year ago, highway privatization was a little-understood niche financing scheme. It is fast becoming the financing of choice, as public interest has been sacrificed for the almighty dollar.
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