Indiana Toll Road hikes approved; truckers hit first

INDIANAPOLIS | The ink on the $3.8 billion Indiana Toll Road lease has had a week to dry, but it will be at least another two months before the state makes public three losing bids.

All four companies made offers on the same 75-year lease, making price the only variable. The Spanish-Australian consortium of Cintra-Macquarie won with a $3.8 billion bid. The public-private partnership appeared to be consummated last week, with Cintra-Macquarie making a $380 million commitment at lease-signing.

The Toll Road lease is hailed as the most lucrative privatization of existing U.S. infrastructure, far eclipsing the $1.83 billion Cintra-Macquarie paid in late 2004 for a 99-year lease of the eight-mile Chicago Skyway.

The deal was predicated on steep increases in toll fares, which the Indiana Finance Authority approved Tuesday.

Beginning in early or mid-June most commercial truck drivers will see a trip from Illinois to Ohio increase from $14.55 to $18.

Passenger cars will continue to pay rates until summer or fall 2007, when electronic tolling is installed. From then until 2016, passenger cars will receive a 40 percent discount.

But the private operator has the power to hike tolls at least 2 percent every year until 2081. By then, a trip across the 157-mile road -- now $4.65 -- easily could exceed $30.

On the losing bids, State Budget Director Chuck Schalliol said Indiana can't risk making the lower offers public until June 30 -- the anticipated closing date with Cintra-Macquarie.

"What if they at the end walked away," Schalliol said. "If you tell them, they might say, 'I'm going to walk away from my $380 million, lower my bid and walk away.' "

The Hoosier State Press Association fought unsuccessfully for earlier disclosure of the losing bids while the lease was winding through the Legislature.

"We would prefer to see that information sooner," said Steve Key, general counsel for the association. But Schalliol and other officials in Republican Gov. Mitch Daniels' administration argued such disclosure could create a domino effect of high bidders bowing out.

"That kind of an argument makes it difficult for us to say that's not a valid argument because there's not really a track record in this state to go on," Key said.

Tollroadnews.com, an online newsletter, has reported that the losing bids all were at least $1 billion less below Cintra-Macquarie's offer. Schalliol on Tuesday wouldn't say.

ITR Concession Co., which will run the Toll Road beginning in July, registered with the secretary of state as a Delaware corporation -- even after Daniels made supporting Indiana companies a major campaign issue in 2004.

"Whether you're registered as an Indiana company or a Delaware company, what matters is, where are your people, where are your jobs," Schalliol said. "A lot of national and international companies are very comfortable with Delaware law. That's not any reflection on Indiana."

The secretary of state's office said the company filed just before 5 p.m. April 12, or about six hours after a lawsuit was filed against the Toll Road lease. The lawsuit, in part, argues that the state cannot sign a lease with a company not registered for business in Indiana.