By Steve Walsh, Post-Tribune staff writer
Local communities can expect some major money — and soon — from the $3.8 billion lease of the Indiana Toll Road.
With the lease’s controversial ride through the General Assembly over and a final approval on a deal pending, the dust has begun to settle on Gov. Mitch Daniels’ Major Moves road program.
Aside from billions for state road projects over the next decade, Major Moves is heavily front-loaded with money and incentives for local communities. Despite some of the the controversy over leasing the Toll Road, no cash-strapped community appeared eager to turn away from the money.
The new law allows the state to begin handing out the first checks beginning July 1 — the same deadline for Macquarie/Cintra to take over operation of the Toll Road under a 75-year lease.
Daniels has said he wants the money to be spent as soon as possible, to rev up the state’s ailing rust belt economy.
Local officials said they are glad for the extra cash but even supporters are urging caution as they start counting the new-found wealth.
“We want to spend it carefully, in ways that will leverage state and federal dollars,” Valparaiso Mayor Jon Costas said.
He would urge the city to add another $300,000 to the city’s $1.5 million road repair budget this year and bank the rest for one of Valparaiso larger, long-term construction projects, like a round-about planned for the city’s east side.
The State Budget Agency released the breakdown earlier this week.
Valparaiso is expected to receive $2.6 million from Major Moves this year. Under the deal worked out among lawmakers, each community receives a portion of $75 million a year for the next two years from the Toll Road lease. Communities and counties must create a Major Moves construction fund. The $75 million can be used for road improvements undertaken by either communities or counties.
Each county along the Toll Road also received a lump sum. Under a Statehouse calculation, Lake County received $15 million and Porter County received $25 million. Each of the other five Toll Road counties received $40 million. GOP leaders in the Senate said the lower amounts for Northwest Indiana take into account the money Lake and Porter counties will receive for the Regional Development Authority. The RDA gets $40 million — with half earmarked for the Gary/Chicago Airport — aside from $10 million a year, for eight years, beginning next July.
The payments to Toll Road counties can also be used for economic development projects or as matching money for grants, interlocal agreements or to pay a local share to the RDA, according to the new law.
Under the law, the lump sums to the counties are supposed to be in the mail to communities, after the start of the state’s fiscal year, which begins in July. The local share of the first $75 million would arrive before Oct. 15. The amount is based on the same formula used to determine how much each community receives in gasoline tax revenue, according to information put out by the nonpartisan Legislative Services Agency.
While they welcome the extra money, some local officials reflected on how the source of the funds still remains controversial.
“You are talking about the equivalent of 21Ú2 years of the county’s road budget for a lease that lasts 75 years,” said Porter County Commissioners President Robert Harper.
To get more miles from Major Moves, Harper said he would recommend the County Council bank the windfall and only spend the interest.
Lake County Council President Will Smith said he has spent more time looking at how to implement a 2 percent property tax cap, which the Legislature also passed this year. He said the money should not be limited to roads and economic development.
“The state keeps tying our hands. I would have preferred they allowed us to use this money for property tax relief,” he said.
East Chicago plans to make its local share part of its pitch for RDA funds to open the city’s industrial lakefront to parks, new housing and retail development, said Ned Ruff, who is also the city’s appointment to the RDA.
East Chicago is searching for approximately $40 million to replace its leaking water filtration plant, while at the same time, shrinking its footprint to gain lakefront access, Ruff said.
Daniels has until April 14 to sign the lease with the foreign, private company. If approved, the official lease transfer, including a check for $3.8 billion, is scheduled to happen no later than June 30.
Hobart has been looking for additional dollars to complete widening of 61st Avenue, though officials haven’t made a decision on where the money will come from. The first phase from Interstate 65 to Colorado Street has state and federal funds, but the project is still on the drawing board to Grand Boulevard, said city engineer Steve Truchan.
“It’s certainly something we would put on the front burner,” he said.