Indiana Democrats propose own Toll Road plan

INDIANAPOLIS | The state could borrow at least $1.6 billion for road construction without leasing the Indiana Toll Road, House Democrats said Wednesday, touching off a partisan war of words only an actuary could love.

And while Hoosiers sparred over the potential pitfalls of privatization, an Illinois official suggested that state put its tollway on the auction block.

"Indiana, this week, gave Illinois billions of good reasons to take a more aggressive look at the potential for such an arrangement on our side of the border," said state Sen. Jeff Schoenberg, D-Evanston.

On Monday, Indiana Gov. Mitch Daniels announced that CINTRA - Macquarie, a Spanish-Australian consortium that runs the Chicago Skyway, offered a winning bid of $3.85 for a 75-year lease of the 157-mile Toll Road.

Next week, Schoenberg plans to ask the Illinois General Assembly's bipartisan forecasting arm to request proposals for a private lease of the 274-mile Illinois Tollway.

Both states face massive shortfalls in their 10-year capital construction plans. Daniels, a Republican, needs $2.8 billion for roads, while Illinois Gov. Rod Blagojevich, a Democrat, is searching for a way to fund a $3.2 billion program to build roads and schools.

Sagging state finances and partisan grid lock have stalled the Illinois plan for three years. Indiana legislators, meanwhile, are bickering over Daniels' lease plan, which needs approval from the General Assembly.

The barbs intensified Wednesday, with House Minority Leader Patrick Bauer, D-South Bend, unveiling a bonding proposal he said would allow the governor to "resist the temptation" of leasing the Toll Road.

"There is a lot of troubled people in Indiana -- troubled because we're selling one of our major assets," Bauer said.

Instead, House Democrats suggest borrowing against future toll revenues, which they said would raise at least $800 million over 20 years. Daniels plans to nearly double commuter tolls later this year and the Democrats' plan depends on those higher rates. The state could generate another $800 million by borrowing against future federal transportation dollars, Bauer said.

"This isn't a plan. This is a joke," responded Chuck Schalliol, the governor's budget director. "If this is the best solution our loyal opposition can present, I'm not impressed."

Schalliol said "basic accounting 101" debunks the Democrats' plan. He said their borrowing projections don't subtract the increasing cost of maintaining the Toll Road. And borrowing against future federal dollars would take funding away from projects included in Major Moves, the governor's 10-year, $10.6 billion transportation program.

Even if the state bonded the proposed toll hikes over 75 years, it would only bring in $1.4 billion, Schalliol said.

Bauer also said he was concerned that the foreign Toll Road operator might go bankrupt.

"If a foreign company defaults, we get to keep the money and we get the road back," Schalliol said.