Headlines

1. Wash. state will stop sending inmates elsewhere
2. RI hearing turns to privatization
3. Passing: Robert M. Ball, Social Security commissioner under three presidents
4. Georgia: Clayton county schools to reject bids
5. Hearing is secret in KBR Iraq case

News Summaries

1. Wash. state will stop sending inmates elsewhere
The Washington State Department of Corrections (DOC) plans to stop sending inmates to private, out-of-state prisons and to begin shipping home the 1,200 inmates at those facilities this summer, reports the Seattle Times. The state prisons system has rented out-of-state prison beds since 2003 to ease overcrowding, but the scheduled opening in January 2009 of the new Coyote Ridge prison in Franklin County will likely allow the DOC to keep all prisoners in state. The out-of-state transfers have put DOC at odds with its own program to keep fathers connected with their children. Research has shown that inmates who keep close contact with their families have lower recidivism rates, and their children are less likely to be incarcerated.

2. RI hearing turns to privatization
A state hearing on Rhode Island Governor’s Carcieri attempt to cut state employee benefits provided a forum for Carcieri’s top legal adviser, Kernan F. King, to argue for the repeal of what he characterized as an “anti-privatization” law passed last year, according to an article in the Providence Journal. Defenders say the new law simply requires the administration to do a detailed cost-benefit analysis before it hires a private company to do work now done by state employees, but King said the law would stretch a routine contract award out over three years and give new opportunities to sue to anyone potentially affected by a privatization. “This legislation is a nightmare,” he told the lawmakers. “It will prevent a balanced budget. It will grind government to a halt and it will unleash an avalanche of litigation.” Eventually, House Finance Committee Chairman Steven M. Costantino, D-Providence, cut him off, saying: “Can we reduce the hyperbole? Can we speak to the issues? I don’t think government is going to grind to a halt.”

3. Passing: Robert M. Ball, Social Security commissioner under three presidents
The Los Angeles Times reports that Robert M. Ball, an indefatigable champion of Social Security who was present practically at its creation in 1935 and rose in the bureaucracy to become its commissioner under three presidents, has died. He was 93. Active virtually until his death, Ball was a key player on a package that rescued Social Security from financial ruin in 1983 and as recently as last year was writing alternatives to President Bush’s proposal to privatize the program, an approach that Ball abhorred. Ball met nine presidents during his career, from No. 33 (Harry S. Truman) to No. 42 (Bill Clinton), except No. 38 (Gerald R. Ford). He bristled particularly at the proposals of No. 43, George W. Bush. "FDR talked about a basic retirement income that would guarantee a certain replacement rate for everybody to build on," Ball said. "For the last 70 years, we’ve been operating a system that’s useful to every American family. Bush’s plan now says we’ll maintain the benefits promise only for the poor."

4. Georgia: Clayton county schools to reject bids
The Atlanta Journal-Constitution reports that for the second time in less than a year, the Clayton County school system is expected to throw out all of the bids for a multimillion-dollar alternative education program because of possible improprieties. The latest move comes as the Southern Association of Colleges and Schools is investigating the 52,800-student district for allegations of unethical conduct, including bid tampering. Board Chairwoman Ericka Davis said there have been problems with the alternative education program since the district decided to hire a private company in March to educate students with severe behavior problems. "It’s not just one incident," she said. "If we keep having to go through this process, maybe we need to look at the current situation and do away with privatization," Davis said. "It might be better if we put more funding and resources toward the current program." Sid Chapman, president of the county’s largest teachers’ union, said teachers should be running all education programs in the district. "The cost of privatization makes no sense," said Chapman of the 2,800-member Clayton County Education Association. "Teachers will lose jobs. Private companies are not required to use certified teachers or counselors." Atlanta Public Schools pays Community Education Partners $10 million a year to help students with chronic discipline problems.

5. Hearing is secret in KBR Iraq case
In an unusual closed session, a federal appeals court will hear arguments today in three cases alleging KBR knowingly sent civilian contractors along a dangerous route in Iraq, where they suffered a deadly attack, according to an article in The Houston Chronicle. The hearing at the 5th U.S. Circuit Court of Appeals in New Orleans will center on the events of April 9, 2004 – sometimes called the Good Friday massacre – when Iraqi insurgents attacked a KBR convoy of military supply trucks, killing six civilian truck drivers and injuring 14. In today’s hearing, the judges will consider whether there is enough evidence to try the cases before juries. A ruling in the plaintiffs’ favor could open the door for similar lawsuits to move forward. KBR’s workers are a critical component of the Pentagon’s privatization strategy, enabling the military to reduce the number of troops needed in the country by turning over noncombat functions to civilians.

Headlines

1. NJ Judge dismisses charges against toll-hike protesters
2. Pa. Gov. Rendell preps hard-sell for turnpike lease
3. Private interest in rail to Dulles
4. Army testing privatized housing

1. NJ Judge dismisses charges against toll-hike protesters
A New Jersey municipal court judge dropped charges Monday against two toll-hike protesters arrested outside Gov. Jon S. Corzine’s speech in Middle Township this month, reports the Press of Atlantic City. Municipal Prosecutor Mary D’Arcy Bittner said she did not want to pursue charges of defiant trespass against former Bogota Mayor Steve Lonegan and Somers Point lawyer and former Atlantic County Freeholder Seth Grossman. Township police arrested and charged the two men Jan. 19 for allegedly trying to bring protest signs into the Performing Arts Center where the governor was promoting his toll-hike plan. A notice on the front door of the center on Middle Township school property banned signs, backpacks and packages from the building during the governor’s appearance. The arrests were captured on amateur video by members of the public at the center and posted on the Internet site YouTube. The footage has been viewed thousands of times.

2. Pa. Gov. Rendell preps hard-sell for turnpike lease
Gov. Ed Rendell is expected to begin an aggressive campaign to privatize the Pennsylvania Turnpike when he presents his state budget blueprint Tuesday to a joint session of the General Assembly, according to the Pittsburgh Tribune-Review. Jim Lee, president of Susquehanna Polling and Research in Harrisburg, puts the odds of Rendell getting private lease approval at "50-50" — an improvement over where it stood last year.

3. Private interest in rail to Dulles
The Washington Post reports that private equity investors are drawing up proposals to partner with Virginia for a rail line to Dulles International Airport as hope fades that the federal government will help fund the 23-mile Metrorail extension. State officials said several equity groups have expressed interest in investing in a rail since Thursday, when U.S. transportation officials declared the project unfit for federal funding.The $5 billion project had been counting on a $900 million grant from the Federal Transit Administration.

4. Army testing privatized housing
As part of the Residential Communities Initiative, the Army is privatizing housing for Soldiers and their families, and a pilot program under RCI is also providing billeting for unaccompanied NCOs and officers, reports the Army Military News. At five installations — Fort Irwin, Calf.; Fort Drum, N.Y.; Fort Stewart, Ga.; Fort Bragg, N.C.; and Fort Bliss, Texas — the Army’s commercial partners under RCI are building privatized apartments for unaccompanied Soldiers.

Headlines

1. Trans-Texas corridor plan met with more loathing
2. Private undersea shortcut from Long Island to New England would be world’s longest car tunnel
3. 2 bills focus on curbing government activity
4. Indiana: Six black nurses allege they were fired for whistleblowing against private prison company
5. Passing responsibility: Editorial
6. Ga. board approves new hospital lease

1. Trans-Texas corridor plan met with more loathing
In what is becoming a regular occurrence in Southeast Texas, more than 1,000 Austin County residents and interested outsiders jammed a county fairgrounds exhibit hall Monday night to let a panel of state transportation officials know that the Trans-Texas Corridor was not welcome here, according to the Houston Chronicle.Similar meetings last week in Hempstead, Rosenberg and Huntsville were packed with residents and local officials who questioned the need for the project and the motives of its supporters. Supporters envision the Trans-Texas Corridor as a network of broad corridors linking major cities, with toll roads for cars and trucks, rail tracks for freight and passenger trains, and space for pipelines and power lines. Such supporters were in short supply Monday night.

2. Private undersea shortcut from Long Island to New England would be world’s longest car tunnel
It would be the world’s longest highway tunnel, running more than 16 miles under the west end of Long Island Sound. The cost is estimated at $10 billion — and it wouldn’t cost taxpayers a dime. A developer wants to build the tunnel with private money, recouping his costs by charging drivers $25 each way and by selling advertising, according to the AP. Developer Vincent Polimeni says the tunnel between Oyster Bay and Rye on the New York mainland would let travelers going between Long Island and New England avoid crowded New York City highways and help alleviate traffic congestion.

3. 2 bills focus on curbing government activity
The Desert Morning News reports on two bills before the Utah State Legislature which have some citizens worried that they could spell the end of publicly-funded recreation centers, golf courses and reception halls. HB 75 would require the government to set up an advisory board that would review and create an inventory of all commercial activities the government is providing. The board would then report to the government privatization policy board, which has been in place for years. The other bill, HB76, would abolish the government privatization policy board altogether. Instead, the state, cities and counties would have to create a commission to whom businesses could appeal the operations of publicly funded projects that compete with them, including golf courses, reception halls and recreation centers. If the commission finds that a public project is improperly competing with private business and the local government doesn’t cease the project’s operations, the commission could ask the district court for an injunction.

4. Indiana: Six black nurses allege they were fired for whistleblowing against private prison company
The Associated Press reports that six black nurses sued a private company operating a Marion County, Indiana jail Monday, alleging they were fired or forced to leave their jobs because of racism or exposing medical practices that put inmates at risk. The 10-count complaint alleges Corrections Corp. of America (CCA) retaliated against the six because they had complained to their supervisors that inmates did not receive prescribed medications, were given wrong medications or were given other patients’ drugs to save money. CCA claims to be the largest private prison company in the country, with about 72,500 beds in 65 facilities in 19 states and the District of Columbia.

5. Passing responsibility: Editorial
The St. Louis Post-Dispatch has an editorial today about how successful was the state’s plan to shift state mental health patients into private groups and agencies. "No doubt it was seductive to believe that there was a simple solution to caring for people whose mental and physical challenges are so profound. Surely the private sector could do so at less cost and, at the same time, relieve the state of the problems of abuse and neglect that have dogged Bellefontaine and other state-operated facilities for the mentally and developmentally disabled. As it turns out, privatization is no magic bullet. State officials last week said that they had been unable to find private agencies that were qualified to handle the demanding assignment and willing to do it for the money available."

6. Ga. board approves new hospital lease
The Fulton-DeKalb Hospital Authority on Monday OK’d a lease agreement that hands over daily operational control of Grady Memorial and opens the door to a public and private sector bailout, according to the Atlanta Business Chronicle.

Headlines

1. Can New York hit the jackpot by selling its lottery?
2. Debate on privatizing the Michigan lottery is revived
3. Transportation secretary backs toll roads
4. US drivers to see major toll hikes
5. Municipal toll roads become likely path
6. Editorial: NC toll roads
7. Penn. turnpike fare increases will be regulated
8. Bill would kill NH toll-bridge project
9. Stephenson’s privatizing

1. Can New York hit the jackpot by selling its lottery?
In essence, a private company, or more likely, a consortium, would be trying to make the state’s lottery system more profitable over the next several decades by taking over management from state bureaucrats. To entice the state to go along, the private investors would have to pay a lump sum large enough to be worth the state’s trouble. Governors across the country have been tempted by the potential, but there has been criticism of proposals to use lump-sum payments to erase short-term budget gaps, according to an article in The New York Times.

2. Debate on privatizing the Michigan lottery is revived
The controversial idea of privatizing the Lottery to save the state and school districts money has been revived, reports the South Bend Tribune. The House Speaker said he wants to use proceeds from the sale or lease of the Lottery to help pay the rising cost of retired teachers’ health plans and ease the burden of health insurance on the state and local school districts.

3. Transportation secretary backs toll roads
With a busy road as a backdrop, U.S. Transportation Secretary Mary E. Peters pledged support for toll projects in Tennessee and elsewhere in the country, while delivering a rebuke to supporters of higher gas taxes, reports The Tennessean. Peters also said she came to Tennessee because of support here for public-private toll roads and bridges. Last year, the legislature voted to allow the state to initially build one toll bridge and one toll road; the legislation prohibits tolls from being added to existing roads. "I believe very strongly that what Gov. Bredesen and the state legislature here have done are paving the way to the future, literally, in terms of passing important legislation that allows them to take advantage of private-sector investment in transportation."

4. US drivers to see major toll hikes
USA TODAY reports that the nation’s toll booths are getting dramatically more expensive to drive through.The sharp increases come as states endure financially lean times triggered by the housing and credit crunch and struggle to find money to maintain or replace vital infrastructure. Big toll hikes are planned for most of the nation’s signature toll roads, bridges and tunnels. The increases would add dollars, not cents, to the cost of passing through many toll booths.

5. Municipal toll roads become likely path
Though the Oklahoma Supreme Court last week put an end to a proposed toll bridge joining Jenks and Tulsa, Oklahoma residents should expect to see additional – and perhaps more carefully crafted – municipal toll road proposals in the future, according to The Journal Record.

6. Editorial: NC toll roads
The Winston-Salem Journal criticizes state toll road agency for asking lawmakers for permission to raise toll fees."Lawmakers have rushed headlong into the toll-road idea to avoid a gas-tax increase and still build some of the new roads we need. It means that people who use these two toll roads will pay gas taxes to support all of the state’s transportation needs and then pay a toll to meet their own need to get home from work."

7. Penn. turnpike fare increases will be regulated
Private companies offering bids to lease the Pennsylvania Turnpike must agree to limit fare increases, Gov. Ed Rendell said last week. There’s no need for alarm about future fares, Rendell said at a news conference, reports the Pittsburgh Tribune Review. "The toll increases must track what the Turnpike Commission will impose" under Act 44, the state’s highway funding law, Rendell said. The commission has proposed a 25 percent toll increase next year, followed by increases linked to inflation thereafter. "Putting ceilings on toll hikes eliminates the unfounded fears being fomented by the Turnpike Commission and its lobbyists in defense of the patronage playground," said Matthew Brouillette, president of the Commonwealth Foundation, a think tank that favors privatization. Roy Kienitz, deputy chief of staff for Rendell, said the governor plans to solicit bids and to present the best proposal this spring to the Legislature.

8. Bill would kill NH toll-bridge project
New Hampshire lawmakers last week considered a bill that would kill the controversial proposal to build a roadway and toll bridge through a Nashua neighborhood, but still allow the state to seek private financing to fund other public works projects, reports the Nashua Telegraph. After an organized group of residents bombarded lawmakers with letters and e-mails stating their opposition to the plan, the sponsors of the bill agreed to amend the legislation to specifically prohibit ever building a bridge and roadway through that neighborhood.“Yes, we’re relieved that we’re not going to have a bridge go through our neighborhood,” Smith said. “But we went through hell over a six week period.”

9. Stephenson’s privatizing
A letter-to-the-editor appears in the Salt Lake Tribune concerning State Sen. Howard Stephenson’s proposed Bill 45, ‘Accounting for Competitive Activities of Local Entities’. "This bill could force city, county or state-owned golf courses, recreation/fitness centers, swimming pools – anything that competes with private businesses – to lose public funding, close and be sold to private businesses, if a private business feels it competes with them. This bill would take away reasonably priced recreational activities from the general public. Once privatized, many ordinary citizens, seniors, singles and families who now pay for these activities at affordable prices, could not afford private-sector golf, swimming or fitness centers. If golf courses are privatized and then fail to turn a profit, they would be sold for development and would be gone forever. We would lose beautiful, green and open space. What comes next? Will the library system close because it competes with bookstores? What about recreation programs that keep our youth occupied with softball, baseball and swimming? This is a bill that tries to fix something that isn’t broken."

Headlines

1. Toll hike foes warn of impact on safety
2. Privatizing lottery is irresponsible gimmick
3. Who wants to camp under a toll road? A bad idea for California’s parks
4. WV delegate opposed to priv. workers comp challenges governor

1. Toll hike foes warn of impact on safety
Opponents of a state plan to hike tolls along the New Jersey Turnpike and other routes are pointing to the potential for more truck traffic and increased risks along alternative roads as truckers inevitably make detours to avoid the higher fees, reports the Star-Ledger. Foes of the plan would like to scrap or at least rework the ambitious and controversial strategy. "Today, the people of my district already face an extraordinary number of trucks coming down Route 1 and Route 130," said state Sen. Bill Baroni, R-Hamilton. "To add to that problem is not good public policy because it makes the roads more dangerous."

2. Privatizing lottery is irresponsible gimmick
Peter Shumlin (D), president pro tempore of the Vermont sate senate has an opinion piece in the Rutland Herald about the govenor’s plans to privatize the state lottery: "While the Vermont lottery encourages everyone to "play responsibly," Gov. Jim Douglas is playing irresponsibly with his proposal to lease our lottery to Wall Street for the next 40 years. Selling off a profitable state asset which belongs to all of us to the same folks who brought us the subprime mortgage crisis is a short-term financial gimmick that is both risky and short-sighted."

3. Who wants to camp under a toll road? A bad idea for California’s parks
Robin Everett from the Sierra Club writes in the California Progress Report about a protest she helped organize at the state capitol concerning a proposed toll road near a popular campground: “A toll road through a state park? You’ve got to be kidding me!” This was the statement heard over and over again by volunteers for Sierra Club, Surfrider Foundation, the Save San Onofre Coalition and myself as we assembled on the steps of the State Capitol to speak out against the proposed Foothill-South Toll Road through San Onofre State Beach.

4. WV delegate opposed to priv. workers comp challenges governor
Outraged by the new privatized workers’ compensation system and the “bullying” of the Manchin administration, Delegate Mel Kessler plunked down his $1,500 fee early Thursday to run for governor of West Virginia, according to the Beckley, WV Register-Herald. Kessler has been a strong critic of the state’s decision to turn the troubled workers’ compensation system over to BrickStreet, and met only a day earlier with the firm’s officials and Gov. Manchin. In that meeting, the Beckley resident said he was amazed that Manchin was unaware of some facets of the new system. “He acted like he didn’t know BrickStreet had tapped into the old fund by $3.5 million,” he said.

Reports
Hearing Record: US House Committee on Transportation and Infrastructure. Subcommittee on Highways and Transit. Title: Public-Private Partnerships: Innovative Contracting. April 17, 2007.

Headlines

1. Milwaukee county executive is overzealous about privatization
2. Columbus schools might outsource meals
3. Virginia: VDOT nixes privatization
4. NJ: Senate gets its first look at Corzine’s toll program
5. Tulsa enters pact with minor league team over stadium

1. Milwaukee county executive is overzealous about privatization
Michael May writes in his Milwaukee Biz blog that he parts ways with Milwaukee County Executive Scott Walker’s over privatization: "I disagree with his comments regarding privatization of county assets, including our airports, golf courses and parks. No formal proposals for the privatization of General Mitchell International Airport (GMIA) have been presented to Milwaukee County. But beyond that, I question why we would privatize an entity that requires no property taxes for its operation and provides 240 family supporting jobs. Their salaries are fully covered by fees paid by airlines and passengers. We have always worked well with the airlines that serve the airport. In fact, GMIA was ranked the fourth-best airport in the United States by Conde Nast Traveler magazine, ranking No. 1 for ease of connections."

2. Columbus schools might outsource meals
Columbus schools are considering privatizing most or all of their food-service operation in an effort to save money, potentially eliminating between 90 and 450 positions, according to The Columbus Dispatch. Superintendent Gene Harris recommended that the district outsource all its food-preparation operations for kindergarten through eighth grade by next school year, a plan that would eliminate about 90 food-worker jobs.

3. Virginia: VDOT nixes privatization
The Virginia Department of Transportation announced last week that it’s shelving discussions that would invite private investment into part of its highway system., reports The Bond Buyer (subscription). “I have directed VDOT to terminate all activities related to the [Public Private Transportation Act] procurement of improvements along the I-81 corridor,” said VDOT commissioner David Ekern in a statement. The commonwealth had been in talks with former Halliburton Inc. subsidiary Kellogg Brown and Root Click for Enhanced Coverage Linking Searchesto use private investment to fund improvements to a portion of the state’s highway system. But a Dec. 18 request from KBR that it did not wish to pursue the project led to VDOT’s decision to terminate all debate regarding the project. In 2007, KBR separated from Halliburton to become its own publicly traded company, and said in its withdrawal request that it needed to “manage its business profile very carefully.” The proposed plan would have established a truck-specific toll for the 325-mile stretch of highway, which earned criticism from the trucking community. The state had been in talks regarding the highway since February 2004.

4. NJ: Senate gets its first look at Corzine’s toll program
New Jersey state senators voiced concern yesterday about the nature of the public benefit corporation that would be created to manage state toll roads under the Corzine administration’s plan to leverage the highways to pay down New Jersey’s debt, reports The Philadelphia Inquirer. Central to the concerns expressed at a Senate Budget and Appropriations Committee hearing on Gov. Corzine’s plan to shore up state finances was what role – if any – the Legislature will have in overseeing the public benefit corporation, known as the PBC.

5. Tulsa enters pact with minor league team over stadium
Tulsa officials hope to lure the city’s minor league baseball team to a proposed new $70 million downtown stadium during negotiations over the next four months, according to The Bond Buyer (subscription). Mayor Kathy Taylor announced on Tuesday that the city has signed an exclusive agreement with Tulsa Drillers owner Chuck Lamson to work out a deal for the team to play in a new stadium to be built on a 16-acre parcel on the eastern side of downtown, six blocks west of the BOK Center. The 7,000-seat baseball stadium was to be the centerpiece of a $1 billion project on a 300-acre site along the Arkansas River. Financing options are a part of the negotiations, but city officials said they expect the stadium would be built with a mixture of public and private funds that could include revenue bonds supported by an increase in the city’s 5% hotel-motel tax. Tulsa may support a move in the upcoming legislative session to amend Oklahoma’s Local Development and Enterprise Zone Incentive Leverage Act to provide state matching funds for at least part of the city’s portion of the stadium project, Taylor said. Additional public funds could come from the sale of city-owned properties around the stadium site, said Jack Crowley, the mayor’s special adviser on urban planning. "This project will generate a lot of activity in downtown and increase the value of those lots," Crowley said. "It is a fantastic opportunity to leverage the city’s dollars through a public-private partnership. We don’t want to miss the boat." The proposed stadium will include 6,000 permanent seats, luxury boxes, and additional seating on grassy berms that could bring total capacity to approximately 10,000.

Headlines

1. Review of Canadian public works projects lauded by Schwarzenegger
2. Va. leases busiest roadway
3. Turnpike pays high toll for Pennsylvania, D.C. lobbying
4. Florida city ponders privatizing services

1. Review of Canadian public works projects lauded by Schwarzenegger
Gov. Arnold Schwarzenegger’s administration cites four projects in British Columbia, Canada, as positive examples of the use of public-private partnerships. SFGate.com examines these BC projects and finds cost overruns and delays.

2. Va. leases busiest roadway
Private companies can collect tolls for 75 years.
Five days before Christmas, the Virginia Department of Transportation signed an agreement with Fluor Enterprises Inc. and the Transurban Group to construct and operate 14 miles of "High Occupancy Toll" Lanes, or HOT Lanes, on the Capital Beltway, the busiest stretch of road in Virginia, reports The Connection.

3. Turnpike pays high toll for Pennsylvania, D.C. lobbying
Whn it comes to lobbying, the Pennsylvania Turnpike Commission is one big spender on the federal and state levels. In 2007, the turnpike commission spent $396,000 in Washington, D.C., more than most large cities and states. It was one of only a few U.S. toll road or bridge agencies to shell out any money at all for politically related activities, reports the Pittsburgh Post-Gazette. The Harrisburg-based Commonwealth Foundation, a research and education group, said the turnpike commission’s big spending on lobbyists is consistent "with its history as a cash cow for political appointees and campaign contributions."

4. Florida city ponders privatizing services
Titusville, FL City Council members discussed privatization at a recent workshop, looking ahead to Jan. 29, when Floridians vote on a state property tax reform amendment that has cities scrambling for ways to keep municipal services running efficiently on possibly less money, according to Floridatoday.com.

Headlines

1. Bloomberg creates a task force to advocate for U.S. infrastructure needs
2. Govenors’ privatization plans
3. States consider privatizing lotteries
4. Cars, trucks might bypass N.J. toll roads
5. Fixing a budget at the toll booth
6. Developer unable to build sound wall blocking toll road noise
7. Opponents to Interstate 81 toll cheers bill
8. State workers left for employers who benefited from their former agency’s corporate outsourcing

1. Bloomberg creates a task force to advocate for U.S. infrastructure needs
Joined by Gov. Arnold Schwarzenegger of California, a Republican, and Gov. Edward G. Rendell of Pennsylvania, a Democrat, NYC Mayor Michael Bloomberg announced the creation of a nonpartisan organization that will advocate for more, and smarter, federal spending on infrastructure. The organization, Building America’s Future, will comprise elected officials and others, and it will be financed by the Rockefeller Foundation, a frequent collaborator with the mayor on pet projects, reports the New York Times. “Infrastructure isn’t sexy or glamorous, and it doesn’t make for great headlines,” Mr. Bloomberg said in Los Angeles, “but it is one of the most important issues facing our country. “And make no mistake about it, we have an infrastructure crisis.”

2. Govenors’ privatization plans
Stateline.org summarizes govenors’ state-of-the-state address: Calif:: Gov. Schwarzenegger (R) said he would continue to push for more partnerships between state government and private industry to help fix the state’s crumbling infrastructure. He estimated the state faces $500 billion worth of infrastructure needs in the next 20 years. NJ: Gov. Corzine (D) vowed not to sell or lease state roads to the private sector, calling instead for a non-profit “public benefit corporation” to manage — but not own — the roads. NY: One of Gov. Spitzer’s (D) boldest plans involves leasing the New York State Lottery to private investors to fund an endowment for higher education, which would be the first in the country. VT: Gov. Douglas (R) suggested the state cut property taxes and increase school construction projects by leasing the lottery to a private concern, an idea sure to spark debate.

3. States consider privatizing lotteries
Courted by Wall Street investment houses, Vermont is one of more than a dozen states where proposals have been floated to lease state lotteries to private investors. But some fear that private companies would be more focused on profits than people, introducing addictive games that prey on compulsive gamblers.
Lawmakers in Illinois, Indiana and Texas have rejected lottery lease proposals in the past two years, but governors in all three states have indicated they’ll raise the idea again, according to an article in USAToday.

4. Cars, trucks might bypass N.J. toll roads
A study predicts 40 percent of trucks would leave the NJ turnpike by 2022, according to an article in the Courier Post. More than one out of every four vehicles that would otherwise use New Jersey’s toll roads will avoid those routes by the time the largest of Gov. Jon S. Corzine’s proposed toll increases takes effect, a study released Friday says. The findings seem to add ammunition for opponents of Corzine’s proposal who have raised fears that increasing tolls would force trucks and cars onto local roads. Assemblyman John Wisniewski, D-Middlesex, a staunch opponent of Corzine’s plan, said local mayors would have to prepare for increased traffic from vehicles seeking cheaper routes. "There’s a lot of downstream consequences that I think need to be very carefully analyzed so that we understand as a state what is being presented to us," said Wisniewski, chairman of the Assembly Transportation Committee.

5. Fixing a budget at the toll booth
"As states and cities look to their roadways to generate badly needed money, the state of New Jersey is offering an approach worth studying. Gov. Jon Corzine wants to shore up his state’s troubled finances by sharply raising tolls. If he gets his way, the cost of driving most of the turnpike could eventually rise from $5.85 to $48, providing money for both debt reduction and public transportation. The plan has potential pitfalls, but it may well be the best solution to a difficult problem," says an editorial in the New York Times.

6. Developer unable to build sound wall blocking toll road noise
The newly opened South Bay Expressway, the county’s first tollway, is a welcome addition for gridlock-weary Chula Vista commuters. But the four-lane, north-south ribbon of asphalt is a literal nightmare for nearby residents, reports the San Diego Union-Tribune. The backyards of their homes, ranging from about 25 to 75 yards away from the road, have no sound wall to block the noise, vibrations and headlights of trucks and cars that zoom along nonstop, day and night. After years of delays, this portion of state Route 125 opened in November, developed by a private company. Since then, some residents have complained of sleep deprivation. “My life is miserable. It’s like living in a war zone,” said Hany Ongyan, 44, who lives on Hamden Drive. “You try to sleep and some semi truck comes along and shakes the house up.”

7. Opponents to Interstate 81 toll cheers bill
Virginia conservation groups are cheering state legislators for filing a bill to hopefully ban tolls on Interstate 81, reports WHSV-TV. Tolls have been proposed to provide $11 billion for an improvement plan VDOT has to widen the entire length of Interstate 81. Rosemary Wallinger says she doesn’t want to see Interstate 81 widened everywhere despite traffic problems. She believes in land conservation, such as saving Valley battlefields. "Transportation today is about more than roads. We’re about more than roads, multi-model solutions to this plan, and we do support improvements, just not the scale thats currently proposed," says Wallinger. She says that 81 would be the only rural interstate to have tolls. However, the road is just too important to Valley residents and businesses. "In addition to being an interstate for many citizens who live in the Shenandoah Valley, it’s Main Street, whether we like it or not. We have industries along this highway, the poultry industry, other industries that are having a hard enough time already," says Wallinger.

8. State workers left for employers who benefited from their former agency’s corporate outsourcing
Two Texas state officials who helped oversee a big push to outsource computer services later went to work for employers who benefited from the program, reports the Dallas Morning News. Larry Olson, former head of the state Department of Information Resources, worked the second half of last year for Houston-based TPI, a leading adviser on corporate and governmental outsourcing. Earlier, his state agency paid TPI $4.5 million to help it re-bid a much-expanded state outsourcing of computer services. Another top official at the department, Kim Weatherford, retired last July to work as a contractor for Stellargy Consulting LLC. Its main owner, Gary C. Young of Dripping Springs, co-owns with his wife, Charlyne, a separate firm, Stellargy Services LLC. Stellargy is a subcontractor for IBM on the state’s $863 million, seven-year outsourcing deal. Leaders of Common Cause Texas and Public Citizen of Texas said the two former officials’ career moves underscore a need to tighten the law to bar decision-makers at agencies from working for state contractors or regulated industries for at least two years after leaving office.

Headlines

1. Tolls ‘wave of the future’ for WA highway projects
2. PA turnpike’s defenders go on offense
3. Calif. treasurer opposes tollway
4. Financing options urged for KY bridges
5. Poll: 56% of NJ residents oppose Gov’s plan to raise tolls

1. Tolls ‘wave of the future’ for WA highway projects
Washington has a long tradition of free highways, but the state will increasingly turn to tolls to pay for expensive bridges and selected road projects, lawmakers predict and reported in The Seattle Times. The state House and Senate transportation panels heard favorable reaction Thursday to legislation spelling out a tolling policy that could benefit future projects, including a new $4 billion floating bridge for Lake Washington. The 2008 legislation doesn’t authorize tolls for any particular project, but anticipates that future legislatures would vote on each toll project as it’s ready to go. "There’s no question, it’s the wave of the future," Senate Transportation Chairwoman Mary Margaret Haugen, D-Camano Island, said in an interview. "We need a different way to raise revenue to help build some of these major, major projects."

2. PA turnpike’s defenders go on offense
Pennsylvania turnpike supporters on Thursday fired back at those who back privatizing the toll highway, saying that could result in fare hikes more than double what motorists would face if the road remains under state control.. "Those toll increases are going to be significant," Majority Whip Keith McCall of Carbon County, the No. 2 House Democrat, told Pittsburgh’s Tribune-Review. "They (private companies) are going to want a big return on their money."

3. Calif. treasurer opposes tollway
California State Treasurer Bill Lockyer, saying he was "deeply disappointed" by Gov. Arnold Schwarzenegger’s support for a toll road extension through San Onofre State Beach, called on the state Coastal Commission to reject the project, according to the Los Angeles Times. The toll road shouldn’t be built, Lockyer said Thursday, because "it would cut through the heart" of California’s sixth-most-popular state park. Last year, Lockyer, as state attorney general, filed a lawsuit to block the road, saying it would destroy environmental resources and disturb sacred religious and ceremonial sites for Native Americans.

4. Financing options urged for KY bridges
Kentucky Transportation Secretary Joe Prather said yesterday that the state’s road fund can’t pay for the $4.1 billion Ohio River Bridges Project and other large highway ventures, and he supports finding new ways to finance them, according to The Courier-Journal. Prather stopped short of endorsing a specific source of additional money, although his remarks came weeks before the state Transportation Cabinet expects to issue a report evaluating whether tolls are feasible for the Ohio River project.

5. Poll: 56% of NJ residents oppose Gov’s plan to raise tolls
More than half of New Jersey residents polled in a recent survey said they oppose Gov. Jon Corzine’s proposal to boost tolls by 50% to help pay down state debt and fund transportation infrastructure, according to The Bond Buyer (subscription). Monmouth University Polling Institute yesterday released the polling results, just one week after the governor announced his debt restructuring plan. That initiative involves the state forming a public benefit corporation that would sell nearly $37.6 billion of debt backed by toll increases, with the bond proceeds defeasing half of the state’s more than $30 billion of outstanding debt, paying down toll road bonds, and financing transportation infrastructure needs throughout the state.

Headlines

1. P3 ‘success’ just a big hoax.
2. Foreign companies eyes US infrastructure projects.
3. A slew of new infrastructure funds
4. Corzine to mayors: tax relief hangs on toll plan.
5. CA Gov. backs trestles toll road.

1. P3 ‘success’ just a big hoax. According to blogger Bill Tieleman, when Calif. Gov. Schwarzenegger cites British Columbia’s public-private partnership projects as a state model, he omits cost overruns. "In the vast majority of examples here in BC and elsewhere, the costs are higher as the public gets hosed to provide private corporations with substantial profits," says Tieleman.

2. Foreign companies eyes US infrastructure projects. Germany’s Hochtief AG sees great growth potential for infrastructure projects such as new roads and bridges in the US, according to the Financial Times and reported in Forbes. Hochtief last year bought US-based Flatiron Construction Corp for 240 mln usd to enter the US civil engineering market and tap into the developing US market for public-private partnerships (PPPs). These types of projects see private companies building, for instance, roads at their own cost in exchange for the right to take tolls for a set period of time. At the end of that period the road is turned over to the state. PPP, most common in the UK, Australia and Argentina, are now starting to be introduced in the US, and more than 20 US states have already done the legal groundwork for such programs, according to the newspaper.

3. A slew of new infrastructure funds have been launched in recent months, according to Project Finance International (PFI) (subscription required) and reported in the AE Feldman blog. Altogether, these new funds have raised capital commitments topping $100 million. PFI attributes the surge in infrastructure funds to several contributing factors. First, cash-strapped governments have enacted legislation enabling privatization or public-private partnerships of various forms, creating opportunities for private participation in infrastructure that did not exist just 25 years ago. Moreover, there is a general move among institutional investors away from stocks and bonds and towards alternative investment products, like infrastructure, in a search for higher returns. Pension funds are also beginning to think of infrastructure as a substitute for long duration fixed income and new funds are catering to this demand.

4. Corzine to mayors: tax relief hangs on toll plan. Gov. Jon S. Corzine warned mayors Wednesday that property tax relief could be cut in the new state budget unless he can reduce state debt, providing local officials an ominous picture of what could happen if his toll road plan is not approved, reports the Courier-Post.

5. CA Gov. backs trestles toll road. Gov. Arnold Schwarzenegger is endorsing an Orange County toll road that would cut through one of the state’s most popular beach areas, reports NBC-SanDiego. In a letter to the head of the Coastal Commission, Schwarzenegger on Tuesday described the six-lane Foothill South tollway as "essential to protect our environment and the quality of life for everyone in California." Critics note the road will pass through San Onofre State Beach and say it might degrade the famous surfing spot.