S
ince 1995, Virginia has been a leader in public-private funding schemes for transportation projects. The state has been able to fund several highway and bridge projects in the Richmond area and Northern Virginia by turning to private financing and operators and avoiding burdening taxpayers who don’t want to pay more taxes or be burdened with extra debt.
To be sure, the public-private schemes have their critics who say that turning public obligations over to the private sector doesn’t always ensure efficient operation despite what the free market mavens would have you believe. And, the schemes often build roads where none are needed and the result is either more suburban sprawl or nothing at all but debt.
So, it is interesting that the McDonnell Administration has come out with a consultant’s report that examines the states public-private process. The report was done for about $100,000 by KPMG Corporate Finance.
The upshot is that Virginia needs to set up a separate agency to better coordinate its public private affairs. More important, it uses the process only for highways when it could try a more “multi-modal” approach that would involve rail, light rail and combinations thereof with highways.
KMPG recommends that the state set up a program with fewer steps to decide a PPTA (public private) project, standardize documents used, develop targets and make sure there’s competition on price when soliciting bids. This could be done by setting up a stand-alone PPTA program office as governments in Ireland, Ontario, Texas and Georgia have done.
Another goal should be to make PPTA less highway-specific, which is a goal of state Transportation Secretary Sean Connaughton. Right now the two biggest PPTA projects include the Pocahontas Parkway near Richmond and the Interstate 495 hot-lane projects near Washington. Connaughton’s newer projects would be to use PPTA a limited access superhighway linking Petersburg and Hampton Roads along U.S. 460 and replacing the Midtown Tunnel in Portsmouth.
Environmentalists, such as Trip Pollard of the Southern Environmental Law Center, say that increasing the multi-modal focus” of PPTA is “a good recommendation.” Even so, Pollard is critical of the secrecy with which the state cloaks itself when talking PPTA with private firms, the amount taxpayers have to pay versus the relatively small exposure of private equity holders and the failure to consider alternatives or be completely straight with taxpayers about overall costs.
A classic example is the Pocahontas Parkway that connects Interstates 95 and 295 and 64 southeast of Richmond. There are big questions why the road is necessary. It cuts about 20 minutes from the time it takes people in Petersburg or south of Richmond to get to the airport, but that’s about it. Apparently, planners hoped for a big explosion of eastward sprawl from Richmond similar to the ugly sprawl one sees around Short Pump in Henrico County and Hull Street Road in southwestern Chesterfield.
Not only is promoting sprawl with a spanking new highway a bad idea, but officials have to scramble when ridership doesn’t go according to script. That’s what happened with Pocahontas. Far fewer people used the road than expected, revenue from tolls was down, the state almost lost its Triple A credit rating and a new PPTA scheme had to be worked out chop-chop.
So, the KPMG study may have some good ideas, but they can’t correct bad planning or the goofy and lingering idea that Virginians can always get something for nothing with PPTA.
Peter Galuszka
Leave a Reply
You must be logged in to post a comment.