August 2006

It’s ironic that on the 50th anniversary of the U.S. Interstate Highway System, we are increasingly selling off the same roads to the private sector because our politicians say that we can no longer afford to properly maintain them.

Across the country, states are leasing their highways — mostly to foreign companies — with the expectation that the private sector will be more adept at raising funds to either repair or build new roads and bridges. New York State may soon be looking at changing its laws to allow such deals.

Many experts and politicians have already taken sides on the issue. Advocates say that by putting control of highways in businesses’ hands, the process of funding roads is depoliticized. Opponents assert that it’s yet another example of leasing U.S. infrastructure to the control of foreign firms. Both sides present valid arguments. Sure, our government has not been very proficient with funding infrastructure, but it also may be too soon to conclude that the private sector is a panacea for our road funding ills.

Businesses’ sole purpose is to make a profit; it improves, or reinvests, in its products to compete for our money. But if the product is a road or bridge that commuters have no choice to use, such as the Tappan Zee Bridge or Long Island Expressway, is there incentive to fund projects to improve them? Will the company just raise tolls to enhance the bottom line, thereby pleasing its investors? These are cynical questions but ones worth asking.

California found out the hard way when several years ago it leased a portion of Route 91 in Orange County to a French company. As the road became increasingly gridlocked, the state discovered that it couldn’t build more roads because of a provision in the lease; it had to buy it back for $207.5 million.

Time will tell, however, whether privatizing roads works, but it is important to keep in mind the old adage, “if it sounds too good to be true…”

One final note: Just a reminder that all roads — leased or otherwise — will lead to the NYS Fairgrounds in Syracuse on Oct. 18 for the 2006 Highway & Public Works Expo. More on that in next issue. P

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