Jerry Wray has tried to be reassuring. The director of the state Department of Transportation argued recently in a speech at the Columbus Metropolitan Club that Ohio has learned lessons from other states that have leased roadways and other public works. He stressed that Gov. John Kasich would strike a deal leasing the Ohio Turnpike that serves well the interests of the state.
What Wray and others on the governor’s team see is an opportunity to bolster resources for highway projects and other transportation needs. The governor has talked about a lease arrangement generating as much as $3 billion. A week ago, the state launched an effort to find a consultant to help in the “development and evaluation of options for leveraging” the turnpike. The effort certainly reflects the governor’s thinking about the private sector outperforming the public sector in almost every way.
How did Wray attempt to ease concerns? He stressed that Ohio would not make the same mistake as Indiana. The administration wouldn’t just take a lump sum. It also would insist on “a percentage of the tolls for the life of the lease.” Ohio would “maintain a role with the turnpike.” It would “maintain strict control over how much tolls can be increased.”
Further, according to Wray, the state would not sign a non-compete clause, or one in which it agrees not to improve parallel roads. It would require that the lease agreement include detailed performance standards sustaining the high quality of the turnpike.
Of course, as Wray acknowledged, the greater the number of restrictions, the lower the amount of money the state can expect from the lease. More, Ohio already features a departure from many other public entities in such arrangements. The turnpike has been well operated, usually efficient and effective with its resources, the highway distinctive for its record of repair and maintenance, plus its quick response during snowfalls.
The Indiana Turnpike and the Chicago Skyway, both part of lease deals, suffered from poor performance, leaving room for private operators to squeeze and reap profits. The Ohio Turnpike isn’t so ripe.
Thus, the question arises: With so many necessary restrictions and the prospects for profit less promising, why would a private operator join in a lease agreement? Or, to add a twist, why give up a good thing, the turnpike performing solidly in public hands? That goes, especially, for a state with multiple challenges on other fronts.
The state has much greater highway needs than likely to be covered in such an arrangement. If anything, the governor and his team should be looking for a more complete response to the insufficient resources for transportation, a problem aggravated by the prospect of federal money shrinking as Congress and the White House look for budget savings.
Listen to Jerry Wray and John Kasich, and they sound like two guys willing to walk away if the deal doesn’t work for Ohio. Let’s hope that proves true. Unfortunately, what hovers is the governor’s belief in the private sector, no matter, seemingly, the reality of the numbers. Ohio deserves better on the turnpike.
