Has Road Privatization Gone Frankenstein?

By Peter Galuszka

Since 1995, Virginia’s politicians  have had a ready tool that they love to use as a ruse to build roads without raising taxes: the Public Privatization Transportation Act.

Once considered a nation-beater and major step in the craze of putting private management methods and money in pubic transport projects, the PPTA was intended to supplement the usually road-building process. Money traditionally would be made available by the General Assembly and groups such as the Commonwealth Transportation Board would access construction needs on a regional basis, select projects and dole out funds.

But as skinflint state legislators refuse year after year to raise taxes (the gasoline tax hasn’t been hiked or adjusted for inflation since 1986), money for construction and maintenance just isn’t there. Not to worry, governors still are getting their pet projects funded by consolidating power in the executive branch through the use of the PPTA.

The process is morphing into something that seems more Kremlin than Thomas Jefferson. The PPTA is badly being misused, according to a report funded by the Southern Environmental Law Center. They hired state road expert James J. Regimbal to put together a scathing look at what is becoming a scary phenomenon. He recommends significant PPTA changes this General Assembly season.

(Jim Bacon has already weighed in with an earlier blog posting).

Here for your interest  is a piece I did for Style Weekly (Q&A) with Regimbal on the same theme.

3 Responses to Has Road Privatization Gone Frankenstein?

  1. Congrats on your article(s). I believe I saw some version in the Post also.

    I’ve generally supported PPTA if the road was going to be a 100% concessionaire toll road privately financed after an investment grade financial analysis.

    The reason why is because the private sector knows how to connect “need” with actual economic demand.

    The Pocahontas Parkway was done initially by VDOT and demonstrated clearly that VDOT either had no business doing the financial analysis or they should have,at least, had an independent investor grade analysis done and if they had done that – the truth of the need would have shone through.

    Some would say that sometimes you have to build roads before they are needed and that if you do that they are actually less expensive that waiting until they are “ripe” at which point acquiring right-of-way is much more expensive.

    some reasonable rationale with that but too much room for error and mischief.

    But back to PPTA. It has morphed into a monster as Peter writes.

    the problem is the State has decided they can do an end-run on NEPA and even financial analysis by finding a private partner who is willing to enter into a subsidy agreement where the investor gets their money and VDOT will cover the shortfalls… for the life of the road. Bad Karma.

    Imagine the State doing this with Dominion power or some other business. Would Va get IBM to come to Va by agreeing to help cover some of IBM expenses?

    the process for want of a better word has gotten incestuous.

    the problem is other than SELC and a few others like Peter the public is dumb as a stump about it.

    The PPTA process is not only problematic.. it’s likely going to create a few financial disasters for the state in the future if they don’t get a better handle on it.

    Geeze.. we’re starting to resemble some of these Northern states that get themselves mired in all kinds of financial skulduggery.

  2. I notice some kind of fuel tax is back on the table.

    It is going to look positively wonderful compared to the tolls we may have to pay.

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