7 day forecast
Rendell chooses Spanish firm to lease turnpike for $12.8 billion
Share with others:
HARRISBURG -- Gov. Ed Rendell today chose a coalition led by a Spanish company, Abertis Infraestructuras, to lease and operate the Pennsylvania Turnpike for 75 years.
Abertis, which is working with Citibank, submitted a bid of $12.8 billion. It was the higher of two bidders interested in leasing the 300-mile, east-west main line of the turnpike, plus the 120-mile northeast extension and two smaller toll roads in western Pennsylvania.
However, the proposed turnpike lease won't be final until it is approved by the state Legislature, and there could be considerable opposition.
Labor unions that represent 1,800 turnpike workers, including toll takers, fear there could be layoffs after the current union contracts with the Pennsylvania Turnpike Commission expire in 2011.
Abertis outbid two other groups: Transurban of Australia, working with Goldman Sachs, a New York investment bank, which $12.1 billion, and Macquarie of Australia, working with Cintra of Spain, which bid $8.1 billion.
Mr. Rendell made the announcement at a news conference in his office today, after working on the proposed turnpike lease for about a year.
Mr. Rendell sees a lease of the turnpike as an alternative to Act 44, which was passed last July to generate $946 million a year for road, bridge and mass transit improvements.
But half the funds from Act 44 were to be raised by putting tolls on Interstate 80, which has caused a lot of opposition in north-central Pennsylvania. And it still isn't known when, or if, the federal government will permit the tolling of I-80.
Mr. Rendell said that if the state invests the one-time, up-front payment from Abertis at the same rates as other state investments, the state would receive $1.1 billion a year for roads, bridges and mass transit.
The initial bids from the two consortiums were within 10 percent of each other, so Mr. Rendell asked them to resubmit the bids last Friday, hoping the state would get more money.
Abertis, based in Barcelona, Spain, operates some airports, toll roads and parking garages in Europe but has been looking to get established in American transportation infrastructure.
More details in tomorrow's Pittsburgh Post-Gazette.
First Published May 19, 2008 11:26 am
