Politics

The Battle Of Pennsylvania

MayorBob.

Posted to Politics on Mon Jul 14, 2008 at 06:14:31 AM EST (promoted by port1080). RSS.

There's a battle going on in the Keystone State. On the one side is a foreign company and an American bank which want to stick some serious money in state coffers in return for being able to charge people who use the Pennsylvania Turnpike.

On the other are the people who currently constitute the authority running said turnpike who see any other way than the status quo as a threat to their wellbeing. The main ammunition used in this war is an array of media ads and web sites assuring the public that their side is telling the truth. In the middle is every person who might be using the nation's first long-distance rural highway over the next 75 years.

Albertis Infraestructuras is the Spanish company which wants to buy the right to charge tolls on the turnpike over the next three quarters of a century. They are offering (US)$12.8 billion to the state treasury to seal the deal. Citigroup is the American bank ready to underwrite the deal. Albertis' presentation (pdf doc) gives all the relevant facts why this is a good deal (mostly for the company). Governor Ed Rendell has gone on record supporting the proposition. All they have to do now is get the legislature in Harrisburg to bite on the offer. This is where the unstoppable force meets the unmovable object.

For the moment, Pennsylvania House Transportation Committee chair Rep. Joseph Markosek (D - Allegheny-Westmoreland) is that unmovable object. He's managed to stall movement on the bill which would authorize the takeover of the turnpike by Albertis. Markosek claims this kills the move to lease the highway to a foreign firm. To which Albertis and Pennsylvania legislators not opposed to the deal have noted the stout lady has yet to sing. State Rep. Richard Geist (R - Blair) says "I don't think this is anywhere close to being over." Now begins the media wars.

The Albertis Group is morphing into something called the Pennsylvania Transportation Partners (PTP) for purposes of launching the media blitz. Said blitz will involve a heavy rotation of radio ads and four to six million direct mail pieces delivered to Pennsylvanians' mail boxes. PTP's Jim Courtovich says they're "100 percent committed" to the deal and they believe "on something of this magnitude and size, they (the public) are as important as the Legislature." Not to be outdone, the Pennsylvania Turnpike Commission (PTC) is countering with their own campaign to keep things the way they are. Initially the PTC has put up a Straight Talk web site to rebut much of what the PTP is saying. One can be assured that the PTC will begin airing their own radio ad campaign along with direct mailers.

The PTC's argument is, once the deal is done, Albertis would be free to furlough turnpike employees, the state would lose the ability to control toll increases, and the company would be insulated from most public oversight. The PTP's argument is the state gets a lot of money now, lose the headaches of funding maintenance and salaries of turnpike employees, and stand to rake in revenues in the future from the arrangement. The instant money and the prospect of a revenue stream to fund other highway maintenance and repair is what informs Rendell's support. The Commonwealth Foundation, has weighed in on the PTP's side and launched a web site of its own, Turnpike Facts. The ads run on the site take the PTC to task for paying lobbyists and PR groups to add tolls to other interstate highways in the state which are currently free. Part of the irony here is that this information was ferreted out due to the effective use of Freedom of Information requests. Should the turnpike be turned over to Albertis' control as the Commonwealth Foundation and the PTP desire, FOI requests would fall on dead ears in Madrid, where Albertis is headquartered.

Markosek is being lauded by a trade group of independent truckers for "taking a stand against selling or leasing the turnpike." However, that same group isn't too thrilled by the rest of Markosek's agenda - that bill to begin tolling I-80 was his.

Tags: edited by Port1080, written by MayorBob, Pennsylvania, Pennsylvania Turnpike, public infrastructure, foreign companies, tolls, money, media campaigns (all tags)

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1

Re: The Battle Of Pennsylvania

port1080.

Mon Jul 14, 2008 at 08:41:14 AM EST

5.00 (informative, informative)

Being from Pennsylvania, I can see both sides of this.  The state desperately needs money for roads funds - PA has an exceptionally dense highway network, and yet much of it covers some very unforgiving territory (Appalachian Mountains) and a climate that's harsh on roads.  PA also gets a LOT of truck traffic - a cursory glance at a map will show you that the vast majority of goods being trucked to and from New England and the New York City / northern New Jersey ports is going to make its way through Pennsylvania one way or another if it's heading west.  All of that ends up meaning that PA has a lot of bad roads that really need repair.

That said, neither option is particularly palatable.  Interstate 80 has become a vital commuter road for people living in northern Pennsylvania - it's not just a throughway for traffic going across the state.  If I80 is tolled, it will create a traffic nightmare for the entire area as commuter traffic is forced back onto local roads, which weren't designed to handle the loads (because I80 was assumed to be able to take the overflow).  It will also probably put a real damper on the area's economy.  Northeast PA used to rely on coal and manufacturing, but both of those industries fell by the wayside in the 1960s-1980s period.  Recently the local economies have picked up again, but a lot of that is based on the fact that the area is relatively centrally located and a good place to put trucking / shipping hubs (due to the intersections of I80, a major East / West highway, and I81, a major North / South highway).  If I80 is tolled, a lot of those companies will probably either move or go out of business.  Amazon.com is currently planning to build a warehouse / shipping center at the I80 / I81 interchange - if the tolling bill goes through, that may never happen.

Selling the Turnpike isn't all that great of an option either, however.  The Turnpike is almost as important to the southern part of the state as I80 is to the northern part, and it's not clear to me that having  a private company in control of such an important piece of public infrastructure is in anyone's best interest.  The price also seems a bit low - were it higher, that would be a bit easier to stomach.  On the other hand, the Turnpike commission is a hotbed of corruption, nepotism, and mismanagement.  Despite very high tolls (it's one of the most expensive toll highways in the nation) the road is poorly maintained and needs substantial upgrading in many areas.  It's hard to see how a private company could do any worse than the Turnpike commission is already doing.

Because of this, I ultimately favor selling the Turnpike over tolling I80, if that's the choice that has to be made, but ideally I'd like to see the Turnpike commission cleaned up and the road run in a more efficient way, so that money can be taken from the Turnpike tolls and used to improve other state roads without having to sell the Turnpike.  While I'm dreaming, I'd also like a pony.

2

^ 1

Take the cannolis, leave the Turnpike.

MayorBob.

Mon Jul 14, 2008 at 09:53:48 AM EST

5.00 (astute)

The one part I'm buying in the argument that the Turnpike should not be sold or leased to a private company is that the private company in question is foreign. Aren't there public infrastructure management firms in the US who would automatically be subject to niceties such as better control over operations and the ability to ferret out information via FOIA requests? Doesn't the outsourcing of traditional government services at least have to undergo serious review and auditing before a deal is struck? Aren't they required to get bids from a number of firms to insure the taxpayers are getting the best deal possible. It seems like the Spanish firm was the only one who stepped up to the plate with a proposal and Governor Rendell and those in favor just saw the $ signs.

By the way, if you ride that pony on the Turnpike, you still have to pay the standard tolls.

Illegitimi non carborundum.

3

^ 2

Re: Take the cannolis, leave the Turnpike.

port1080.

Mon Jul 14, 2008 at 10:11:31 AM EST

none

It seems like the Spanish firm was the only one who stepped up to the plate with a proposal and Governor Rendell and those in favor just saw the $ signs.

My understanding was that some American firms made initial bids, but they were clearly going to be substantially lower than those from the Spanish firm, so they weren't pursued by either side.  I could be wrong about that, though.

4

Re: The Battle Of Pennsylvania

skeeter1.

Mon Jul 14, 2008 at 04:49:27 PM EST

5.00 (astute)

"The main ammunition used in this war is an array of media ads and web sites assuring the public that their side is telling the truth. In the middle is every person who might be using the nation's first long-distance rural highway over the next 75 years."

We've had the same shit on our stretch of I-80 through Ohio.  The debts were paid off years ago, and the tolls were supposed to go away.  Guess what?  They never did.  I don't think they ever will.  Same thing with the PA turnpike.  It's bad enough for us cage-pilots, but hell on the truckers.  The savvy ones have taken to using US30, US18, I-90, and others instead.  

The state is hell-bent on adding another lane to I-80, but no one is going to use it.  A complete waste of money, if ever there was.  I should have been a cement contractor and cashed in on the deal.  

there's only one way to find out...

5

highway funding and the open road

wetkarma.

Tue Jul 15, 2008 at 06:11:03 AM EST

5.00 (astute)

As the slow motion train wreck of the US fiscal system continues, I think the future is clear for transportation: metered access.

We'll start with toll roads, then switch to variable rates for tolls based on time, then variable rates based on time and vehicle used on all highways, finally you'll have per-mile pricing for all roads.

Use of roads will become like the use of electricity - a utility. This will have interesting social effects as the poor becomes further trapped in ghettos and the advent of private road systems makes a booming comeback.

Just remember kids -- all temporary tax increases are permanent.

 

Memory is a strange bell, jubilee and knell.

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^ 5

Re: highway funding and the open road

port1080.

Tue Jul 15, 2008 at 10:27:27 AM EST

none

As the slow motion train wreck of the US fiscal system continues, I think the future is clear for transportation: metered access.

We'll start with toll roads, then switch to variable rates for tolls based on time, then variable rates based on time and vehicle used on all highways, finally you'll have per-mile pricing for all roads.

I don't think this is very likely.  I think that the worst that would happen would be a move to toll the Interstate system as a whole (or, even more likely, just the rural portions which serve as throughways, rather than the portions around cities that serve as commuter roads).  This would potentially be politically salable - the largest bulk of the tolls would fall on businesses (truckers) and the more well off / middle class (if you've got a car and doing a lot of Interstate driving, odds are that you're at least middle class).  Local roads would be an absolute nightmare to toll.  Sure, you could require every car to have a GPS - but how would you enforce that?  You can't control access on local roads the same way you can on the Interstate.  You'd have to shell out billions to try to put a camera on practically every street corner (which would be an insane task, considering the number of roads in the US).  I just don't see it happening.

7

^ 6

Re: highway funding and the open road

skeeter1.

Thu Jul 17, 2008 at 12:14:38 AM EST

none

"I think that the worst that would happen would be a move to toll the Interstate system as a whole (or, even more likely, just the rural portions which serve as throughways, rather than the portions around cities that serve as commuter roads)."

Just my hunch, but you probably haven't been on the beltway around Chicago.  Stop every 10 miles and pay a toll.  It's a complete PITA!  Traffic backups, wasted fuel, incredible.  I'll rather take my chances on the Dan Ryan expressway (scary as it might be) instead.  

there's only one way to find out...

8

^ 7

Re: highway funding and the open road

Shy Elf.

Sat Jul 19, 2008 at 05:10:49 AM EST

none

Even in a nation whose national identity seems based on eating its seed corn, this proposal strikes me as uniquely odious.  The only thing that keeps me from being truly outraged is the confidence that, when push comes to shove and we need the right of ways back again, we'll find some way to swindle the foreign investors out of their investment and will take over the highway again.

Does anyone here really believe that there is a more fundamental role for local government than transportation?  Transportation, education and police/security/military are the core roles for government.  Any proposal to privatize these services in order to save money amount to cutting the meat from the budget in order to save the fat.

Of course, had Pennsylvania not been neglecting its roads for decades, there would not be an immediate crisis like this, and this "crisis" mostly reflects the decision to rely on federal pork for routine highway maintenance, as well as a lack of skill by Pennsylvania in acquiring federal road money pork.

I am reminded of the time when I was trying to get to Granite Peak in Montana.  The approach road was full of mud puddles, and foot-high rocks in the middle of the dirt road, which was barely passable for a careful driver of a normal 2-wheel-drive vehicle.  This is what Montana thought was a reasonable road for the area.  Then I hit the border of the national forest, and suddenly the road was pancake-flat dark new pavement with paved shoulders, which is what the federal government thought was the needed road, despite the fact that it was impossible to get there without going over the Montana-style road first.

I am constantly astonished by the willingness of "free market" supporters to support toll roads in the name of economic efficiency.  Toll roads are, as skeeter1 points out, anything but economically efficient.  In Illinois as elsewhere, half of the toll revenue collected goes to collecting tolls, and this doesn't even count the gas wasted slowing for toll booths.  The road tolls provide an economic incentive to use local roads, which require more frequent stops and increase fuel usage.  Large trucks have an incentive to use local roads, where they cause far more damage than on the interstates designed for large trucks.  A gas tax is far, far more economically efficient than any toll road scheme, because it does not provide an irrational incentive to use any road instead of any other road.  We really ought to have banned federal funding for toll roads long ago.

10

^ 8

Re: highway funding and the open road

Ober.

Mon Jul 28, 2008 at 02:55:12 PM EST

4.00 (interesting)

"Does anyone here really believe that there is a more fundamental role for local government than transportation?  Transportation, education and police/security/military are the core roles for government.  Any proposal to privatize these services in order to save money amount to cutting the meat from the budget in order to save the fat."

Yes, actually people do believe that government has more fundamental role than providing public transportation.  Those of us who still believe in Madison/Jeffersonian democracy and the historic roots of our representative form of government believe that government exists to protect individual rights.  Under the banner of protecting individuals rights exists sub-categories like judicial system, national defense, and rights of representation.  The government exists primarily to protect your rights, not primarily to provide goods and services.

Transportation is a vital part of any economy, but the government role should be one of regulator, not provider.  An attack on the Turnpike lease via an appeal to "core functions of government" is entirely misguided and fails to understand the Framers understanding of a liberal republic.

9

^ 8

Re: highway funding and the open road

thefadd.

Mon Jul 21, 2008 at 06:59:41 PM EST

none

We really ought to have banned federal funding for toll roads long ago.

We should have banned federal funding for highways, period, long ago. It would have put a stop to all sorts of pernicious federal meddling (national drinking age, national speed limit) under the threat of cutting off funding.

It is easy to buy small plaster models of what you think life is like.

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