Massachusetts Senate leader comes out for look at privatization of Turnpike

Therese Murray president of the Massachusetts Senate and a Democrat says the state needs to look closely at the merits of sale or concession of the Massachusetts Turnpike. She was reported saying this after a chamber of commerce speech by the Boston Herald which quotes her:

"The Turnpike has $8 billion in assets. Do we look at getting rid of some of those assets, selling them or leasing them? Those are all things that really need to be discussed before we go to raising the gas tax."

The state governor Deval Patrick (Democrat) has appointed UBS as consultants to advise on privatization of state assets with the state turnpike a major subject. UBS has been working on the project for some weeks.

The governor's office told us this afternoon that there is "no timeline" for completion of the report but it is wanted "as soon as possible."

We don't know what the chances are for concessions getting anywhere in Massachusetts. The state Turnpike has a pretty horrible reputation and is a most unloved institution. However it now has a whole new crew at the top and many will be inclined to give them time to improve its performance. A secret society previously it now actually publishes annual reports, financial accounts and schedules of board meetings.

On the other hand the Turnpike in Massachusetts has none of the independent power base and huge political clout wielded by, say, the Pennsylvania Turnpike. If the governor and leading legislators decide it should be concessioned out under a longterm lease there is no independent powerbase in the Turnpike in Boston to fight it.

Public opinion on the subject has not developed.

BACKGROUND: For business purposes the Turnpike system is operated as two separate entities:

- Western Turnpike which is I-90 from the New York State line east to the junction with MA128/I-95 the north south-peripheral route in the western suburbs of Boston, for most of its length a typical 2+2 lane rural expressway, and about 170km (110 miles) long but the east-west backbone of the state, its key link to the mid-west, and an important feeder route to the Boston metro area

- Metro Highway System comprising the 4+4 lane Turnpike Boston Extension also I-90 which heads east into downtown Boston and I-93 and now to the waterfront and to Boston Airport via the Williams Toll Tunnel, plus the other toll-free Big Dig structures and old Sumner and Callahan toll tunnels to East Boston and the airport.

The Turnpike has the assets which could make it into one of the major toll authorities in the US but perpetual political turmoil and politicization of toll setting (especially zero-toll decisions on the I-93 portion of the Big Dig and on the far western end for cars) has left it a minor and tenuous entity.

Just the most recent political intervention was the proposal weeks before the last state election by then Gov Mitt Romney to completely abolish tolls on the Turnpike without proposing any alternative sources of revenue at all.

Toll revenue the last several years has stagnated around $250m, making the Mass Pike now smaller than much newer toll authorities in California, Texas, Florida and other places, and small fry besides the toll authorities of Illinois, New Jersey, New York and Pennsylvania. Most of its revenues are absorbed in operating costs so it is unable to do proper maintenance let alone generate a return on capital.

The Turnpike's reputation has been grievously harmed by mishandling of the Big Dig project, the largest public works construction management fiasco in many decades. Turnpike managers with half a brain would have flatly refused to take on a project this difficult and this expensive without any revenue potential at all - just debt and operating costs to be covered by tolls squeezed out of motorists elsewhere in the system.

TOLLROADSnews 2007-10-25