Out of Control Policy Blog

Terms of Potential PA Turnpike Lease Announced

Governor Rendell's office released the terms of a Pennsylvania Turnpike concession yesterday. Highlights include:

  • a 75-year concession term;
  • a single upfront payment from the winning bidder;
  • no non-compete clause, nor any provision for the concessionaire to seek compensation for reduced toll revenues resulting from the currently-unplanned construction or upgrade of nearby competing transportation facilities;
  • concessionaire would be allowed to increase toll rates by 25% initially and thereafter by an annual inflation adjustment (either 2.5% or the rise in Consumer Price Index, whichever is greater);
  • concessionaire will be held to some 500 pages of operating and safety specifications; and
  • no restrictions on foreign bidders.

For more details, see Peter Samuel's excellent overview at TollRoadsNews.com, as well as the Philadelphia Inquirer's article yesterday.

And be sure to check out this blog post on Reason's recent policy brief (finding that the Turnpike is one of the least cost-efficient toll roads in the country), as well as Bob Poole's astute response to criticism of the report by the PA Turnpike Commission.

Lastly, over the last few months, the Inquirer ran two op-eds co-authored by yours truly and Commonwealth Foundation President Matt Brouillette on the subject of a Turnpike concession--see here and here.

Leonard Gilroy is Director of Government Reform


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