Turnpike lease winner gives 30-day extension
HARRISBURG -- The winning bidder for a Pennsylvania Turnpike lease granted the state a 30-day extension on its offer, a spokesman for the financial consortium said Monday.
The $12.8 billion bid for a 75-year lease by Pennsylvania Transportation Partners, a Spanish firm and New York City company, expired Friday. The previous 30-day offer expired because the Legislature failed to approve a lease.
The Legislature is likely to adjourn for summer recess in early July. Gov. Ed Rendell, the leading proponent of privatizing the turnpike, has said he wants the turnpike lease on the legislative agenda in September.
"In 30 days, we'll look at what the next steps are," said Jim Courtovich, a Washington, D.C., consultant for the partnership, which includes Abertis Infrastructuras S.A. and Citi Infrastructure Investors. "We're fully aware of the whole dynamic and the governor's decision with legislative leaders to put this off until fall."
"Every 30 days you look at it," based on market conditions and internal financial factors, Coutovich said.
Although it appears to have little support now, "you know the governor. You know how he can work an issue," said Rep. Tom Tangretti, D-Greensburg. "If I had to do a head count now, I'd say no (support for the lease). But (Rendell) is a persuasive guy."
Senate Majority Leader Dominic Pileggi, R-Delaware County, "is opposed to a sale of the turnpike, and he views the 75-year lease as a sale," said spokesman Erik Arneson.
The biggest factor that could change the dynamic in the Legislature is if the federal government issues a decision on whether Pennsylvania can levy tolls on Interstate 80, Arneson said.
Tolling I-80 is a key component of the transportation funding law, Act 44. The Federal Highway Administration is awaiting final paperwork from the Turnpike Commission and PennDOT before issuing a decision.
The proposed turnpike privatization deal was dealt a blow last week when the state House voted 185-12 on an amendment that would have authorized Rendell to execute the lease offer.
"The money is what keeps (turnpike privatization) alive," said Matthew Brouillette, president of the Commonwealth Foundation, a think tank supporting the deal.
"It's a simple matter of looking at the numbers," Brouillette said. Compared with Act 44, "the lease wins hands down. More money is generated for transportation infrastructure, and it shifts the risks off of the taxpayers and on to the private investors."