Peter DeFazio, incoming highways chairman, doesn't much like corporatized toll roads.

Mother Jones magazine has an extensive story this month on the move to privatize highways and turn them into toll roads run by for-profit corporations.

(And yes, there's a move afoot here in Oregon - discussed on BlueOregon by Russell Sadler in June and September.)

In the Mother Jones article, they point to the toll road scandal in Indiana -- where Republican Governor Mitch Daniels gave a multinational company the rights to charge tolls for 75 years. There's an extensive segment with Congressman Peter DeFazio -- due to become the chairman of the Highway and Transit Subcommittee of the House Transportation and Infrastructure Committee. Here's that clip:

The hearing was a fairly docile affair—that is, until Oregon's Peter DeFazio, the ranking Democrat on the subcommittee, got his turn questioning [Governor Mitch] Daniels. "So you're saying that there's no political will to raise the tolls," he began, "but if you enter into a binding contract which gives a private entity the right to infinitely raise tolls, then that'll happen—but politically you couldn't say we're going to go out and raise the tolls."

"Well, you're a busy man, Congressman," Daniels responded dryly. "I don't expect you to understand our state."

"No, sir. I'm just asking a question," DeFazio shot back, his voice rising. "Are we outsourcing political will to a private entity here?"

When DeFazio spoke with Mother Jones months later, he was still seething. Daniels, he said, "just screwed the state of Indiana and the people of the state of Indiana." In his view, mig-Cintra has "a license to print money here. They do the deal, put money up front, turn around and go to a bank, which will gladly give them whatever they want, and pay themselves back, and they are left with equity and debt. They are projecting that they already would have broken even around the 15th year. So we've committed an asset for 75 years and after 15 years the state could have been making money on it."

DeFazio continued, "When you look at the Chicago Skyway, that's even worse. They are not even reinvesting the proceeds of the sale in transportation. They're using them for operating costs. That would be like anybody selling their assets in order to live. You can't sell your assets very long to put food on the table—before long you're out of assets. Chicago has sold an asset, which will be extraordinarily profitable for the company that got it."

DeFazio's take harkens back to Eisenhower and his vision of a national highway system as vital to economic development, commerce, and even national security. "It's a scam, basically," he says. "And you lose control of your transportation infrastructure. It means you fragment the system ultimately. It just does not make sense for an integrated national transportation system."


  • cwech (unverified)

    Excellent, as a resident of Yamhill County I'm becoming extremely frustrated by the possibility that 99W and a bypass would both be toll roads. This is good to hear that DeFazio is standing up against this stuff, hope Wu joins him.

  • peter (unverified)

    looks to me like the problem is not necessarily corporate toll roads, but the ridiculously favorable terms the corporation is getting for these roads.

    defazio makes a very salient point that inherent in privatization is the outsourcing of political will, and political accountability. though that only works when the public doesn't figure out who was responsible for the bad deal in the first place. in daniels case, he is now very, very unpopular.

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    though that only works when the public doesn't figure out who was responsible for the bad deal in the first place. in daniels case, he is now very, very unpopular.

    That may be true, but long after Daniels is gone - the political will to raise tolls will be outsourced. It won't be until the latter quarter of this century that Indiana will get back its roads.

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    "It won't be until the latter quarter of this century that Indiana will get back its roads."

    And by that time, they'll be old, ugly, and not even able to whore themselves out for $3.50 a ride!

  • TomCat (unverified)

    I guess I don't have much of a stake, as I gave up the costly driving habit several years ago in favor of public transportation. Nevertheless, I think privatizing highways is a terrible idea.

  • lrr (unverified)

    Toll roads could work if they're part of government. ie one state used tolls to pay for a highway. After it paid for itself in five years, they tore down the toll booths.

    Why should we give a private foreign corporation the right to profit off our roads? What do we pay transportation taxes, gas taxes, etc for?

    It cost me $15.00 and 8 stops for a roundtrip from my sister's house in Denver to the airport on their private toll road. Is that what we want here?

    Denver's tolled bypass is a road that hardly anyone uses because it's so expensive. The net result is that they keep increasing the tolls. Now the freeways in town are more crowded than ever.

    Who will pay for emergency vehicles? While on that road I didn't see a single police car, bus, nor any other public vehicle.

    Outsourcing a toll road to an Australian company and then putting tolls on the competing public freeway because that corporation demands it is insane. Have our legislators lost their minds?

  • lin qiao (unverified)

    Geez Louise, what a bunch of pinko skeptics. Look, this is the season for magic, and this scheme is The Magic of The Marketplace writ large. Someone needs to point this out to Mister Tee and the rest of the pseudo-libertarian set, which has been wanting to privatize roads forever.

  • JohnH (unverified)

    I lived in Connecticut when the state got rid of all toll roads after truckers repeatedly fell asleep at the wheel and plowed through vehicles stopped to pay tolls, resulting in fatalities. It's better to raise the gas tax than have tolls.

  • Adron (unverified)

    There is an obvious reason why roads are becoming privatized.

    Ever since the Government monopolized the road creation and dissolved the private solvency of the passenger transportation industry in this country we're left with inadequate funding of roads and other such problems.

    How does an inadequate and always incapable Government solve the problem? They go crawling with their schemes to the private sector, back to the backs of those who built this country.

    So now that we're stuck with cars we need a real solution. Privatized road creation, maintenance, and operation (as proven a dozen times over, all around the world) is an obvious solution to just one of the dozens of Government incapabilities.

    ...oh and I love the silliness of stating, raise the gas tax, because that's fair. Do we give vouchers to people who don't use the roads?

    Tolls are fair use based "fares" on road usage. If they had been allowed to stay in place we'd probably still have the massive trolley networks, intraurbans, passenger rail, and other such great services America used to have. But when the Cities, States, and Fed just hand out roads like it's a damn joke what can one expect.

    ...oh yeah. More congestion and hot tempers.

  • urban planning overlord (unverified)

    There is a single reason we have toll road proposals today in Oregon.

    In November, 2000, voters in Oregon were given the opportunity to ratify a gas tax increase approved by the state legislature. This was the result: The measure went down by a huge margin of 5 to 1.

    So, at this point, our choice for new roads is toll roads, or no roads.

    As for whether a toll road should be rpivately run or publicy run, that is an open question, and I think one that Peter DeFAzio and Blue Oregon progressives should properly debate. But the concept of toll roads in and of themselves has been decided by the actions of Oregon's voters.

    Two additional points:

    Adron is absolutely right - automobile usage in this country has been heavily subsidized, and has resulted in the dimunition of alternative transportation modes and the sprawl and suburbanization of this nation. "Congestion pricing," or tolls, merely balances the scales again.

    I don't support the concept of converting existing free roads to toll roads, such as existing 99W through Newberg. Only new facilities should be tolled, not existing ones. This leads to a problem with the Dundee Bypass because of the use of the free road. My solution? Turn 99W through Newberg back into the "Main Street" it once was, by making it two-way again, eliminating the couplet, redesigning it to emphasize pedestrians over autos with lots of signal lights, put in some diagonal parking, and the traffic through downtown Newberg will be local once again, which is what it should be.

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    The Libertarian trolls on this site keep using jargon like "user fees" and congestion pricing." These are euphemisms for rationing.

    You price the poor off the highways with tolls removing "congestion" that disturbs the well-to-do on their commutes.

    It is deliberately anti-egalitarian in keep with the conservative and Libertarian goal of creating an aristocracy of wealth in our country.Like the war in Iraq, no one campiagned on a platform of toll roads. And like the war in Iraq, when the real consequences of toll roads become clear, the public will revolt.

    I wouldn't want to be the politicians in the way.

  • LT (unverified)

    In November, 2000, voters in Oregon were given the opportunity to ratify a gas tax increase approved by the state legislature.

    In 2000, lots of people voted no on many ballot measures to protest the number of ballot measures that year (many of those measures were Sizemore measures, but there had been lots of legislative referrals). There were legislators around that time who had said openly that Oregonians didn't need to have input as bills were debated because they could always vote their opinions when the legislature put referrals on the ballot---and some people vote against legislative referrals because they think legislators should do more deciding themselves. Or, as a friend put it, "aren't we paying legislators to deal with such complex matters?".

    Secondly, "the concept of toll roads in and of themselves has been decided by the actions of Oregon's voters" really means that once voters have decided, no one who was not registered and voting in that election permanently loses the right to express an opinion.

    How many people who voted in the 2006 election lived in Oregon in 2000? How many were born between 1982-1988 and thus were not old enough to register and vote in 2000? The voters in 2006 chose a number of legislators under the age of 40. How many in the age group 24 and under helped elect those younger legislators? Are those younger legislators really going to say that once people voted in 2000 the topic can never again be discussed? Or will they say "Of course we can re-open debates that happened years ago"?

    "The voters have spoken" was Minnis-speak---spoken on measures whose results she liked--not all measures ever passed. In 2006, voters turned down Measures 41 and 48 which would seem to suggest the old "the voters have spoken, and nothing about taxes can be discussed except for tax cuts" rhetoric didn't reflect the mood of all voters in 2006. That rhetoric didn't guarantee the return Minnis's party to majority.

    If there is open public debate on new roads being toll roads, that is one thing. "We've decided the road you have been driving for years from home to work should have a toll" could result in revolt.

    The idea of making downtown Newberg local again sounds appealing, but there are a couple of questions: is that what residents of Newberg want, or is the overlord just going to tell them that is what will happen? where does the money come from to pay for that?

    Roads should be controlled by government, not by a corporation.

  • urban planning overlord (unverified)

    I hope you haven't put me in the category of "libertarian troll," Mr. Sadler.

    Converting existing free roads to toll roads? Bad public policy, elitism, you are dead on.

    But, putting that issue aside, how do you propose to pay for all the new "free" roads needed to keep all of those poor and working class folks stuck in their cars out of traffic jams? The last attempt to raise the gas tax failed 85-15 in Oregon.

    Next, where do you propose to put all those new free roads? New freeways and other urban roadways have traditionally been placed through poor and working class communities, because they lack the political clout to stop the road, and because their lower property values lower the road's overall cost.

    Finally, the very poor and downtrodden you champion against the "Lexus Lane" crowd tend to also include an awful lot of folks who can't afford any car at all, or can't get affordable auto insurance, or have a disability preventing them from driving. Putting all those finite tax dollars into new free roadways shortchanges alternative transportation strategies designed to serve them.

    So, realistically, the choice is not between "lexus lanes" and free-ways. The choice is now between "lexus lanes" and no new roadways at all.

    Unless, of course, you have joined the conservatives in believing that "stopping government waste" will free up billions of dollars for new roadways.

  • Urban Planning Overlord (unverified)

    LT: a little additional history.

    The May 2002 defeat of the gas tax measure was not close - over 85% against will take an awful lot of changed minds to make a different result this time.

    The May 2002 Measure was one of six on the ballot, not a small number historically, but only half the number on our last ballot.

    The May 2002 Measure was not a "legislative referral." The legislature passed the measure in 2001, and peititioners collected the signautres necessary to put a referendum on the law on the ballot.

    As for downtown Newberg, I find it hard to imagine that any community in Oregon wouldn't want to reclaim their historic downtown from state highway passenger and freight traffic, but I certainly wouldn't mind asking the citizens of Newberg whether or not they agree. Remember, the whole bypass idea came about because Highway 99W traffic was choking in Newberg and Dundee.

  • Sid Leiken (unverified)

    The Oregon Transportation Commission is engaging the private sector to pay for as much of the improvements as possible, whether a state run highway or the interstate system. It is not necessarily a written policy but they are clearly strong arming local governments to come up with a match, or as they say, participation. I am not necessarily opposed to this policy as long as I know what to expect.

    It is the 11th hour surprises that cause me heartburn that I don't care for. My city runs very efficiently and I, therefore, expect other government entities to do the same. If ODOT staff would enable the local staffs a little more control in working things out with local governements I believe they would be viewed in a different light. Problem becomes, centralized power in Salem making decisions where they don't need a hands on answer. Instead they could be provided the answers from those on the groundfloor.

    As for tolls, I don't have a clear answer. I have dealt with tolls in the past but usually in metro areas that have more people living in them than the state of Oregon.

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    UPO wrote... But, putting that issue aside, how do you propose to pay for all the new "free" roads needed to keep all of those poor and working class folks stuck in their cars out of traffic jams?

    You're not actually arguing that more roads will create less traffic, are you?

    Except where there are physical barriers and chokepoints (like the Columbia River bridges), the law of triple displacement means that traffic won't improve on the most congested portions of roads.

    When there is predictable traffic (i.e. Sunset Highway at 5:30 p.m.), people adjust their behavior to travel at a different time, on a different route, or via different transportation modes. Each person will do that based on their own cost/benefit criteria that compares traffic annoyance to the desire to travel at the peak/preferred time, route, and more (i.e. Sunset at 5:30.)

    In other words, traffic is at precisely the market-driven point where everyone is annoyed - but not so much that they change their time, route, or mode. If you double the number of lanes, for example, you make it possible for more people to choose that time/route/mode set -- and traffic will fill right back up. Conversely, if you cut the lanes in half, you wouldn't have more traffic -- rather, more people would choose another time, another route, or another mode.

    Except where there is a chokepoint like the Columbia River crossings, building more capacity won't reduce peak traffic. It only moves more people into that peak period from other times, other routes, and other modes.

    (Which isn't a bad thing, but mass transit critics and pro-highway advocates always scream about how we need more highway capacity to reduce peak traffic -- but that doesn't actually work.)

  • urban planning overlord (unverified)

    Kari, you are of course correct - my gibe about new roads was meant with more than a dollop of sarcasm. The phenomenon you expound on is well-documented - In "The Power Broker" Robert Caro notes that it was first noticed on the many new roads Robert Moses foisted on New York starting in the 1930's.

    Perhaps "no new roads at all" is preferable from a policy standpoint over even new toll roads, much less free roads.

    My policy would be to allow new roadways if they pay for themselves, and use our tax dollars to build up the alternative public transit, bicycle, and pedestrian infrastructure we have neglected over the past few decades. I think car drivers should remain with the choice to use their vehicles - we should just make sre they pay the costs.

  • LT (unverified)

    My policy would be to allow new roadways if they pay for themselves, and use our tax dollars to build up the alternative public transit, bicycle, and pedestrian infrastructure we have neglected over the past few decades.

    Except that denies the reality of people's lives outside of the Metro area. Someone who gets a new job which involves a commute from Monmouth to McMinnville or Salem to Monmouth, people who live in Salem but work in Wilsonville (or similar commutes) because they have a home and roots in one community but were hired to work in the other community, people whose job requires carrying things in the trunk of a car which would be hard to carry onto public transportation (product demonstrators bringing materials with them to the site, sales people with a territory which may be multiple counties, etc.) don't fit into the mode of alternate urban transportation.

    And that doesn't even begin to scratch the surface of people whose work involves driving around one or more rural counties on the Oregon Coast or E. of the Cascades.

    Given the headline of this topic, people should try to envision how their proposed solutions would work in rural Lane County or other parts of the 4th Congressional District--not just for residents of Eugene and Springfield.

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    LT, you're right that where there is no road at all, people can't get there from here.

    However, I daresay that there aren't very many places in Oregon where there's not a direct route from one to the other (with the exception of those failing bridges that Governor Kulongoski started to fix with his billion-dollar infrastructure project last term.) Certainly, road repair is a worthy and important project.

    This conversation has moved to whether or not we need to add additional capacity to existing routes to reduce traffic.

    Do we need more roads from Portland to the wine country? Maybe. But they won't reduce traffic.

  • DAN GRADY (unverified)

    Public Transit is alive and well in those cities that embraced it!! The Metro in the Beltway is a very good example, as well as Trimet, and the New York Transit System that I know of!!

    The idea that government service and oversight of the commons is better placed with the private sector has been a complete failure at every turn, and rolling out an example of the railway systems, and LARY in LA is not good enough to make sense in today's much different world. LARY was begun by the Hamiltons and when it was made finally viable with the help and variance of the County and City, they limited the service to fewer cars and less timely service as a profit strategy that made the cars packed full a peek hours. It was a motivating factor when the decision came to buy them out, and lingered when the state went for super highways, and freeways.

    But; to assume that a concerted effort of government oversight of private contractors and private ownership is not possible would be to deny our history of governance nationwide from every level. This constant pull of private and government usage vs. ownership is a ying & yang struggle that will go on into perpetuity.

    The fact that we have been victims so often from crony politics, corruption, and incompetence is not so compelling coming from an argument for the private sector that commits these same sins, and makes government look grandly preferable in the process.

  • Ross Williams (unverified)

    However, I daresay that there aren't very many places in Oregon where there's not a direct route from one to the other (with the exception of those failing bridges

    The reality is that Oregon's existing highways are slowly failing as well. ODOT and the Republicans in the legislature have not been keeping up with basic maintenance, using revenue to build new facilities instead. It will be a long time before roads start to go back to gravel, but there is a big bill coming down the road when roads that haven't been properly maintained have to be rebuilt instead.

  • Jason McHuff (unverified)

    people who live in Salem but work in Wilsonville

    FYI, transit has at least this commute taken care of. But yes, I agree that transit doesn't make economical or practical since for some trips.

    Overall, charging tolls is a good way to pay for pay for projects since an up-front fee moderates use. And having private enterprise take over government functions, roads or otherwise, results in an added cost: a profit.

  • lrr (unverified)

    I haven't seen a compelling reason to privatize roads that were already paid for by taxpayers. It offers a short-term gain that becomes someone else's problem down the line and ends up costing everyone more money. Buses will avoid the road or be forced to raise rates, who will pay for the police, fire, etc or will all those new costs come from local governments? Will this company pay property taxes for the private use roads?

    I'd be less skeptical of government oversight for proposed infrastructure monopolies if we didn't witness a complete failure of the PUC in its oversight duties w/ PGE. Why does the government think it's okay to add a toll to a road that would compete w/ the 99 bipass? That's not a "free market" action, that's catering to a company to enhance their profits at the expense of our citizens.

    There are other taxes we could raise or reallocate that are supposed to be used for roads, infrastructure, and public transit.

    TRANSPORTATION | KEY FACTS 2006 44 Oregon Department of Transportation Revenue Sources — 2005-2007 $ Millions Beginning Balance 349 Motor Fuels Taxes 852 Driver and Vehicle License 499 and Fees Transportation Licenses 63 and Fees Weight-Mile Tax 455 Transfers to the Department 104 State General Funds 9 Oregon Lottery Proceeds 33 All Other Revenue 44 Sales and Charges for 22 Services Subtotal State Funds 2,430 Federal Funds 605 State Highway and Oregon 744 Lottery Revenue Bonds TOTAL REVENUE $3,779 Source: 2005–2007 Legislatively Adopted

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