Could Public-Private Partnerships Bring Tolls to Connecticut?

New Connecticut Gov. Ned Lamont said he is convinced the private sector would be interested in working with the state because a revenue stream would be guaranteed if tolls are approved by the legislature.

by Christopher Keating, The Hartford Courant / March 11, 2019
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(TNS) — Connecticut Gov. Ned Lamont said Thursday he is exploring public-private partnerships to construct electronic highway tolls, potentially bringing in the private sector on the controversial issue.

The state would issue a request for proposals to get direct feedback from businesses, but all details have not been worked out yet.

One possibility is private investors could provide upfront money to construct the overhead toll system before motorists start depositing hundreds of millions of dollars a year into state coffers. The construction costs for Lamont’s toll plan are currently projected at $213 million. Tolls would not be fully implemented until the 2025 fiscal year.

"How do you get the toll gantries going before you have the funding coming in?'' Lamont asked. "That’s part of what we can do with that partnership. They front some of that money. In terms of design and operation, we do that in collaboration. They’ll get a piece of the revenues over a period of time in compensation. You do have to get a rate of return on this. ... You’ve got to have some way to give the private sector return on what they’re doing.''

Lamont conceded that the idea is "a little premature'' because the legislature has not approved tolls. Republican leaders say there are no Republican votes in either the state House of Representatives or the Senate for tolls. Democrats control the House by a 91-60 margin and the Senate 22-14.

Lamont said he is convinced the private sector would be interested in working with the state because a revenue stream would be guaranteed if tolls are approved by the legislature.

"There’s real interest,'' he said after a speech Thursday at a downtown Hartford hotel. "I’ve got a recurring, reliable, predictable set of revenues coming in [from tolls]. I’ve got an extraordinary need when it comes to transportation infrastructure. ... Then the private sector is ready to come in. They can provide some implementation.''

Lamont wants to engage the private sector in the same way that Webster Bank helped out recently with state-backed loans for federal workers who had not been paid during the government shutdown, which has since ended.

"I come out of the private sector. I know what the private guys like,'' said Lamont, who created a cable television and digital company that bore his name.

But Lamont said flatly he does not have all the answers on an issue that is still evolving.

The governor said he is not looking to establish a private toll road as has been done in other states, including a highway leading to Washington Dulles International Airport in Virginia.

“I don’t think I’d go that far,” he said. “I don’t think we want to give away our infrastructure. ... We set the operating rules. We set the parameters. We say this is the return that you’re going to get and this is the return that we’re going to get. ... We’re going to be smart about how we do things."

One of the key aspects to the strategy would be the work of David Lehman, the former Goldman Sachs executive who has been nominated by Lamont to be the commissioner of the Department of Economic and Community Development. Lehman is working for the administration, but his confirmation is still pending in front of the legislature after running into some grassroots opposition due to his work at Goldman.

“This is a guy who did this. He put together public-private partnerships,” Lamont said of Lehman. “He did opportunity zones. That was his focus over many years down on Wall Street. I’ve got a real pro who has taken the lead on this. I’ve just got to get him going here. ... He’s been on the other side. Now, he’s fighting for the state of Connecticut and our taxpayers. That’s what I like.”

Once the idea on tolls is fleshed out, Lamont would need to get it approved by the state legislature. He has introduced a bill that would allow executive branch agencies to create public-private partnerships in order to spur economic growth and job creation.

"We’ve got to work on that,'' he said of legislative approval. "We’re going to talk about that. I think it gives folks some confidence that you’re going to have some private-sector discipline as part of rebuilding our transportation system. I don’t think it will be a tough sell. ... I’m not giving away ownership. I’m not giving away control.''

©2019 The Hartford Courant (Hartford, Conn.). Distributed by Tribune Content Agency, LLC.

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