A growing list of bankrupt public-private partnerships, including the failed Indiana Toll Road, has Congress reassessing the role of private investment in transportation infrastructure, Bloomberg BNA reported.
Citing a recent analysis by the Congressional Research Service, BNA said the spate of public-private partnership (P3) failures is raising questions about how large a role P3s can play in addressing the nation’s infrastructure needs. The CRS, which provides policy and legal analysis to Congress, reportedly shared its assessment with Congressional offices Sept. 29.
“The financial problems of the Indiana Toll Road concessionaire provide more evidence that P3s could be of only limited help in solving the transportation funding problems facing federal, state, and local governments,” CRS reportedly said in an “Insights” analysis.
The Indiana Toll Road Concession Company paid $3.8 billion in 2006 for a 75-year lease from the Indiana Finance Authority under which it agreed to operate, maintain and make improvements to the road in exchange for the right to collect tolls. The operators of the Indiana Toll Road filed for bankruptcy Sept. 21 to get out from under $6 billion in debt after traffic volumes on the toll road were lower than expected.
The CRS said that traffic was 11 percent lower in 2013 than in 2007, BNA reported, because of the economic recession that began in 2007 and because the company raised toll rates on trucks.
The CRS analysis also cited the financial difficulties of San Diego’s South Bay Expressway, Richmond’s Pocahontas Parkway, and the SH-130 in Texas.
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