In what may be just one step in a move to privatize U.S. highways, the House of Representatives in Indiana has voted to sell its 157-mile toll road to private investors. A joint offer of $3.85 billion from Australia’s Macquarie Infrastructure Group (MIG) and Spain’s Cintra Concessiones de Infrastructuras de Transporte SA (Cintra) helped spur the vote (52 to 47) which was strictly along party lines, with the representatives supporting Republican Governor Mitch Daniel’s initiative. Democrat objections in the House focused on what was seen by them as not enough study being put into the issue, that operators are foreign and the fact that the lease to be signed runs for 75 years. The roadway is the portion of Interstate 90 that connects Ohio with Illinois.
Receipts from the deal are aimed at paying for Governor Daniel’s ten year $2.8 billion plan to upgrade the state’s infrastructure, including expansion of highways. The money is the largest amount ever paid a U.S. state or municipality for an asset.
The same two companies, under their Skyway Concession Co., previously signed a-99 year lease with the City of Chicago, at a cost of $1.83 billion, to operate the Chicago Skyway, the 7.8-mile toll road that connects the Dan Ryan Expressway with the Indiana Toll Road.
The two companies are aiming to spend some $700 million over the next nine years for improvements on the highway, says Cintra, including additional lanes and electronic toll collection. The company already has a deal with the State of Texas to build a $6 billion 316-mile highway between San Antonio and Dallas. MIG owns toll roads in the U.S. near Washington, D.C. and San Diego.