Indiana Toll Road lease could hit bumps down the road

A meeting of transportation officials Thursday offered a glimpse into the tricky negotiations between public and private sectors that could come with any long-term lease of the Indiana Toll Road.

Around a table at Gary/Chicago International Airport offices, Northwest Indiana officials quizzed Skyway Concession LLC's chief executive about an upcoming Chicago Skyway construction project. The officials fear the project could snuff movement between the region and Chicago.

It quickly became apparent the private company stands ready to help alleviate traffic crunches. But the project will go forward at the same time that two other major expressways are undergoing major reconstruction.

"We don't see any advantage of doing this work three years from now rather than now," said Fernando Redondo, chief executive officer of Skyway Concession. "If we wait, say two years, it would only worsen the situation and wouldn't help anyone.

"And it would definitely not help us," Redondo added.

Redondo's Skyway Concession is determined to turn the eight-mile Skyway into a profitable enterprise. That goal could at times conflict with public needs in the region. So discussions like Thursday's are sure to take place.

And those discussions could take place over a wider landscape if Gov. Mitch Daniels' proposal to lease the 157-mile Indiana Toll Road becomes reality.

That proposal appears to be picking up steam. At a press conference Dec. 15 at Gary/Chicago Airport, Daniels said there are six or seven firms showing serious interest in leasing the 49-year-old interstate. Proposals from those companies are due in late January.

Redondo confirmed the parent company of Skyway Concession is interested in leasing the Indiana Toll Road. That would give the Cintra-Macquarie Consortium control of a stretch of U.S. Interstate running from the Ohio border to the heart of Chicago.

"Without any question, it makes all the sense in the world from the business point of view to have both of them," Redondo said.

Local officials across northern Indiana already have expressed concern about the possible lease of the Toll Road. Those concerns range from possible toll increases to how responsive a private operator will be to making improvements to aid economic development.

For example, new toll road interchanges may be needed in rapidly developing areas outside cities. But just where the interchanges would go and when they get built would probably have to be negotiated with any private toll road operator.

Thursday's meeting at the airport, and earlier ones Skyway officials had with Illinois transportation officials, could foreshadow how those types of discussions would go.

And construction schedules are not the only places where public and private interests intersect.

CEO Redondo said Skyway Concession is currently negotiating with the City of Chicago over toll scofflaws so gates can be removed at I-PASS toll lanes. Removing the gates could double toll lane capacity to more than 1,200 vehicles per hour, Redondo said.

But Skyway Concession doesn't have the means of seeing scofflaws are ticketed once they leave the Skyway. It also cannot levy fines.

Gov. Daniels' move to explore Toll Road privatization, first broached after Chicago entered into the 99-year lease with Skyway Concession, appears to be picking up steam.

In his recent visit to the Gary/Chicago Airport, Daniels aggressively pitched the lease of the Toll Road as the best hope for funding a wide range of projects. He said six or seven firms have shown serious interest in leasing the Toll Road. He indicated it might fetch more than the $2 billion the state originally estimated.

"We have the chance to build twice as much infrastructure and Indiana's future ... with other people's money," Daniels said.

"Mayor Daley did a very innovative thing (with the Skyway), and we are trying to go to school on it," he added.