John Kasich appears eager to lease the Ohio Turnpike. On Tuesday, the governor shared early plans about how he would deploy the proceeds of a deal. The effort was another attempt to sound reassuring, many across the northern tier of the state, where the 241-mile highway runs, skeptical about privatizing the road. No surprise, then, the governor proposes that a majority of the money go to transportation projects north of U.S. Route 30, which travels east and west across the state through Canton and Mansfield.
The plan contains other sensible elements, including dedicated funding streams for local bridges and public transit. The governor also pledges to be a “good neighbor” to communities adjacent to the turnpike. How much money would a lease arrangement reap? The estimate has been $3 billion or so, the state clearing $2.4 billion, though that amount hardly is firm.
And that gets to the concern that has surrounded the idea since it was first put forward by the Kasich team: Are the circumstances right for the state to strike an advantageous deal? Will a governor with an ideological bent toward privatization prove practical enough to just say no?
So far, there is no deal. The governor has hired a consultant to weigh whether an agreement would work for the state. Jerry Wray, the director of the state transportation department, has talked about the state driving a fair bargain, including a steady funding stream and restrictions on toll increases.
Yet, as Wray knows, the more requirements the state establishes, the less money it can expect from a lease. More, the debt market has changed dramatically since Indiana collected $3.8 billion for its 157-mile turnpike in 2006. After the financial calamity, the market has become much tighter, investors leery of such leasing agreements. The Indiana experience has been problematic, even with steep increases in toll rates.
Gov. Kasich describes the turnpike as an “underutilized asset.” What deserves emphasis is that the asset is part of a whole. Strike a misguided deal, and higher tolls will raise the cost of transporting cargo, sending trucks to secondary roads, bringing more headaches than benefits. Or maintenance may be neglected, leading to a different set of problems that diminishes its utility.
There are alternative ways to generate steady money for roads and bridges. And they should be pursued — if the state cannot arrange a most favorable lease for a roadway that currently functions well. With all the state’s challenges, the turnpike shouldn’t become another one.
