INDIANAPOLIS – In 2006, the agreement allowing the lease of the Indiana Toll Road to a private company as well as the bill authorizing the public-private partnership were public and vetted – sometimes loudly – for months.
The legislature approved the bill in March and the deal closed June 30 – a 75-year lease that seemed pretty set in stone.
Fast forward 12 years and Gov. Eric Holcomb dropped a bombshell this month – a $1 billion payment to the state over three years in exchange for a one-time, 35 percent toll increase on commercial vehicles with three axles or more.
He also has a plan on how to spend the money – roads, broadband, trails and flights.
All without legislative involvement and with a lot of secrecy.
Even lawmakers extensively involved in the 2006 process were surprised.
“I don't think anyone at the time thought it could be amended without coming back to the people's representatives,” said former Rep. Win Moses, D-Fort Wayne.
He said he understands small tweaks for workability but said “it was not meant to completely change the numbers without a further public review.”
Former Rep. Randy Borror, R-Fort Wayne, said the proposal was discussed more than any he has ever been involved with, including more than a dozen hours of testimony and debate. He carried the original Toll Road lease bill.
“The feeling back then was it was a 75-year lease with solid terms,” he said. “All of us knew the statute could be changed. But we were less sure of the operating agreement.”
The bill itself allowed the Indiana Finance Authority to enter into the agreement to lease the Indiana Toll Road, but the specific details of the lease aren't in statute. For instance, it's the lease that limits annual toll increases to the greater of 2 percent, inflation or gross domestic product annually.
“I was kind of surprised,” said Robert Poole, director of transportation policy and Searle Freedom Trust Transportation Fellow at Reason Foundation. He initially reviewed a similar Illinois lease for then-Gov. Mitch Daniels and has followed the Indiana transaction closely since.
“The legislators voted to approve the original deal and the public was deeply involved. There was legitimate concern about what the (toll) pricing would be and the agreement controlled and limited that,” Poole said. “If suddenly the formula that was built on can be changed on a regular basis that isn't what the legislature signed on for. That is concerning.”
Theoretically the company could seek increases again and again over the next 63 years.