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Senate Approves Measure to Discourage US Private Toll Roads

Tuesday, 13 Mar 2012 07:02 PM

 

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The U.S. Senate voted to exclude privately operated toll roads from the formula that calculates U.S. highway aid to states, a possible blow to companies like Indiana Toll Road manager Macquarie Infrastructure Co.

The amendment to a proposed surface-transportation bill was adopted today on a 50-47 vote. The measure proposed by Senator Jeff Bingaman, a New Mexico Democrat, joins language already in the bill that would limit tax breaks for public-private partnerships.

Those proposals counter other parts of the bill and parts of President Barack Obama’s fiscal 2013 budget that encourage states to attract investment in infrastructure.

Lawmakers and Obama are looking to companies and investors to help pay for toll roads and other projects as the Highway Trust Fund, which pays for infrastructure from U.S. fuel taxes, faces insolvency as soon as October.

The Bingaman amendment was backed by the American Trucking Associations and AAA, the former American Automobile Association.

Indiana, Illinois, Colorado

The American Road and Transportation Builders Association opposed the plan, which the construction trade group said would “punish states” using companies to operate toll roads.

“At a time when all levels of government are under increasing budgetary pressures, we should be incentivizing states who seek to leverage their limited resources,” ARTBA President Peter Ruane said in a letter to senators yesterday.

The Bingaman amendment covers three states -- Indiana, Illinois and Colorado -- according to Maria Najera, a spokeswoman for the senator.

Indiana in 2006 leased its turnpike for 75 years to Cintra, a unit of Madrid-based Ferrovial SA, and Sydney-based Macquarie Infrastructure, in the largest U.S. public-private road lease deal to date.

‘Killer Amendment’

In other votes, the Senate rejected, 30-67, an amendment by Senator Jim DeMint, a South Carolina Republican, that would have returned most transportation spending decisions to states.

Senators also turned back, 28-70, a measure by Senator Dan Coats, an Indiana Republican, that would have ensured each state receives the same amount in U.S. highway funding that its citizens pay into the Highway Trust Fund through fuel taxes. States that in the past had high numbers of earmarked projects unfairly locked in higher spending levels, Coats said.

Senator Barbara Boxer, the California Democrat who crafted the bill, described DeMint’s proposal as “the end of the federal highway transportation system” and Coats’s as a “killer amendment.”

The Senate also rejected, 30-68, a provision by Senator Rob Portman, an Ohio Republican, that would have allowed states of opt out of the U.S. highway program.

The most recent surface-transportation legislation, which was passed in 2005, allocated about $286 billion over six years. Highway programs have operated on eight short-term extensions at about the same spending level since 2009, when the bill was set to expire.

The White House budget released earlier in February that proposed $476 billion over six years on surface transportation, with an immediate $50 billion this year.

--Editors: Bernard Kohn, Steve Geimann

To contact the reporter on this story: Jeff Plungis in Washington at jplungis@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

© Copyright 2014 Bloomberg News. All rights reserved.

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