BY PATRICK GUINANE, Times of Northwest Indiana
pguinane@nwitimes.com
INDIANAPOLIS | There are no plans to sell or lease the South Shore Line, Gov. Mitch Daniels' administration said Wednesday in a written statement.
The statement followed a report in The Times indicating the Republican governor's administration was considering privatization of the commuter line, similar to a recent 75-year lease of the Indiana Toll Road, an option the top executive of the railroad's ownership group twice has said was suggested by the state transportation commissioner.
"The governor has zero interest in selling or leasing out the South Shore, and has no ability to do so if he did. State government does not even own the South Shore," Daniels Press Secretary Jane Jankowski said in a written statement, one that also criticized The Times' report on the issue.
But comments from the top executive of the Northern Indiana Commuter Transportation District, which owns and operates the South Bend-to-Chicago commuter railroad, seems to contradict the administration's stance. Gerald Hanas, the district's general manager, said he was asked to explore cash-generating privatization options about a month ago when he met with state Transportation Commissioner Tom Sharp.
"He said, 'Look, we've gained some significant revenue under the P3 (public-private partnership) thing with the Toll Road. Is there any way you guys could look at options for P3 for the railroad? Is there anything that you could lease or sell or anything that would make any sense to leverage capital?'" Hanas said Wednesday, reiterating earlier remarks. "We said we'd research it."
On Tuesday, the Indiana Department of Transportation denied such a conversation took place. A spokesman for INDOT, which recently created an office to oversee privatization projects, did not return messages Wednesday.
Use of "advisers" irks administration
"No 'adviser' of any sort has ever raised the idea of selling or leasing the South Shore Rail Line with Gov. Daniels," Jankowski said.
The Government Efficiency Commission, a public-sector panel appointed last year by Republican legislative leaders, issued a report this week stating that "we question if the Northern Indiana Commuter Transportation District is a candidate for sale or lease."
The commission was empaneled to advise Daniels on the future of the dozens of boards and commissions that populate state government.
Still, Jankowski took The Times to task for reporting that "advisers" told the governor the state should consider privatizing the South Shore Line. The term "advisers," she said, gave a false impression that the idea came from high within the administration.
The efficiency report led The Times to contact Hanas, who first said Tuesday the topic had come up with Sharp, Daniels' transportation chief.
Jankowski did not address Hanas' comments. Sharp was unavailable to comment on Wednesday.
"Major Moves was a one-time opportunity to bring billions of dollars and thousands of jobs to the state without a penny of taxes involved. This solution to Indiana's road crisis has been repeatedly attacked with misrepresentations, and the (Times) story (Wednesday) contains the same defects," Jankowski said.
William Nangle, executive editor of The Times, expressed a different view.
"We misidentified who appointed the government efficiency panel in the initial story, indicating it was through Gov. Daniels' administration," Nangle said. "The appointment was made through the Legislature. The suggestion such privatization be considered is factual and has been discussed."
Democrats lash out
Democrats, meanwhile, pounced on an opportunity to further criticize the Republican governor.
"Mitch Daniels continues his efforts to turn our state into a discount store with a railroad used by thousands of commuters each year serving as the next blue light special," said House Minority Leader Pat Bauer, D-South Bend.
The governor is not on the Nov. 7 ballot. But Democrats hope voter discontent over some of his top initiatives will give them the handful of victories they need to take control of the Indiana House.
Topping the attack list is the Toll Road lease, which brought the state $3.8 billion for a decade of road construction and up to $120 million in regional development projects for Lake and Porter counties.
"I think the governor's trying to look at every avenue to most efficiently run the state of Indiana," said state Sen. Vic Heinold, R-Kouts. "The fact that INDOT denies these (South Shore) conversations -- I think it probably is something that has been looked into and the Democrats are using it now as another springboard to attack the governor right before the November elections. There are heavily contested House races, and they've played the Toll Road out as much as they can, so I think they're trying to stir something new."