Seven Counties May Bid For Ownership Of Indiana Toll Road Lease

Gov. Mitch Daniels sold the legislature on the 75-year lease of the Indiana Toll Road, in part, on his assurance the state of Indiana would regain control of the toll road in the event the private consortium which paid $3.8 billion for the long-term lease ever went bankrupt. Now that the private operator has gone bankrupt, the Indiana Finance Authority refused calls for it to reclaim the toll road, arguing the estimated $68 million required to maintain and operate the toll road annually was too costly. The Northwest Indiana Times' Keith Benman is reporting on a potential bid by the seven northern Indiana counties through which the toll road passes making a bid to operate the toll road as a public, nonprofit entity.

LaPorte County is leading the effort according to the report. Investment banker Piper Jaffray & Co. of Minneapolis has been retained by the county's commissioners to provide advice on a potential bid. A 7-county consortium would have the advantage of being able to issue tax-exempt municipal bonds to finance debt for the lease but would still rely on a private operator to run the toll road. A Piper Jaffray analysis estimates a bid of $3.7 billion, requiring the borrowing of about $4.1 billion. The 7-counties would not be on the hook for the debt; rather, revenues generated by the toll road would be solely relied upon. LaPorte officials believe the deal would still throw off some additional revenues to the participating counties. Other counties which could participate in the deal include Elkhart, LaGrange, Lake, Porter, Steuben and St. Joseph.