HARRISBURG -- The federal government's rejection yesterday of a plan to put tolls on Interstate 80 means Pennsylvania is facing a transportation "crisis," and heightens the need for the Legislature to quickly approve a private bid to operate the Pennsylvania Turnpike, Gov. Ed Rendell said.

Mr. Rendell said yesterday he doesn't think the $12.8 billion lease offer from a consortium of New York-based Citigroup and the Spanish firm Abertis "will stay on the table past Jan. 1. It would be playing Russian roulette for the Legislature not to act [this fall] on the Abertis proposal."

He said the offer to lease the turnpike for 75 years is the only alternative left for the state to raise the $1 billion a year it needs to fix crumbling roads and bridges and to bail out struggling mass transit agencies, including the Port Authority of Allegheny County.

Mr. Rendell said he talked yesterday afternoon by phone with U.S. Transportation Secretary Mary Peters, who rejected the Pennsylvania Turnpike Commission's application to put first-time tolls on I-80 starting in mid-2010.

She told him the proposal didn't meet federal criteria for new tolling on interstate highways, such as a requirement that all the money generated be used for improving I-80 alone and not for other roads.

In a statement, Federal Highway Administrator Tom Madison said, "We are legally bound to ensure applications for this program meet all congressionally mandated requirements. We are regrettably unable to approve this application."

Officials and groups opposing the tolls, such as U.S. Reps. John Peterson and Phil English, the Harrisburg-based Commonwealth Foundation and a truckers group called the Owner-Operator Independent Drivers Association, were jubilant.

"I have repeatedly stated that the tolling of Interstate 80 would kill the future economic viability" of Pennsylvania, Mr. Peterson said. "[Yesterday] the Department of Transportation agreed. It's time for the governor and the state Legislature to stop using highway funds for mass transit and other non-highway-related issues and get serious about fixing our roads and bridges.''

Commonwealth Foundation head Matthew Brouillette said the rejection of the tolling plan is a sharp blow to the Turnpike Commission, which he called "a nefarious and scandal-laden" agency. Many critics have said that turnpike decisions on hiring and contracts are often based on political connections.

But the commission has many friends in the Legislature and will certainly fight any attempt to approve a private lease. Leasing the turnpike to Citi-Abertis would almost certainly put the politically powerful commission out of business. If the I-80 tolls had been approved, the turnpike commission's empire would have doubled in size, as it would have run I-80 as well as the 68-year-old turnpike.

Turnpike Commission officials declined comment yesterday until they'd been "officially notified by the Federal Highway Administration" of the reasons.

The tolls on I-80 were a key component of Act 44 of 2007, which was designed to raise nearly $1 billion a year, starting in fiscal 2010-11, to boost transportation systems.

The other component of Act 44 is a 25 percent increase in tolls on the turnpike, which is set to take effect in January. But without the I-80 tolls, Mr. Rendell said, a $450 million-a-year hole will be blown in the Act 44 funding scheme in two years, so an alternative must be found.

The loss of the I-80 toll revenue won't be immediate because Act 44 called on the Turnpike Commission to float $850 million in bonds this fiscal year and another $900 million in bonds in fiscal 2009-10.

The only long-term alternative for transportation funding that Mr. Rendell knows about is the 75-year lease of the turnpike to Citi-Abertis. The offer includes $12.8 billion up front, which Mr. Rendell said would be invested. He expects that to generate about $1 billion a year.

Citi-Abertis officials claimed their offer actually amounts to more than $21 billion, with $4.2 billion in new taxes for the state and nearly $5.5 billion in turnpike improvements added to the one-time upfront fee.

Mr. Rendell said the only other transportation funding idea would be an 8.5 cent-per-gallon increase in the state's gasoline tax (from 32 cents to 40.5 cents per gallon), but he said that is unfair to drivers and politically impossible.