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Toll Road counties object
Northern Indiana: Indy region's $1B share of lease money is too big
By Bill Ruthhart
February 6, 2006
More than $1 billion in new road projects would break ground in the Indianapolis region if Gov. Mitch Daniels leases the Indiana Toll Road, a plan Northern Indiana leaders say funnels too much money to the state's core.
Those from the Toll Road counties say the plan, in which a Spanish-Australian consortium would pay $3.85 billion to operate the highway for 75 years, gives the Indianapolis region more than its fair share of the lease money.
"This is another time where they're taking resources we use to develop our part of the state and taking them down to Indianapolis," said Rep. Scott Pelath, D-Michigan City.
"It's a tough pill to swallow."
If Daniels leases the Toll Road, a little more than $1 billion of the proceeds would be spent through 2015 on new construction projects in Marion County and its eight surrounding counties. The seven northernmost Indiana counties through which the Toll Road passes would receive about $100 million more, or $1.1 billion, of the lease money under a House bill passed last week.
Though the Toll Road counties still would receive more money, leaders there say Central Indiana's cut is too large, reigniting a decades-long tension between Indianapolis and the other regions of Indiana.
"We've always felt like it's Indianapolis versus the rest of the state," said Rep. Robert Kuzman, D-Crown Point. "So far, Indianapolis is winning this battle."
The General Assembly still must grant Daniels the power to lease the Toll Road.
The Indiana House voted last week to do so but added changes to allow a freeze on commuter tolls for 10 years and $100 million for economic development in northeastern Indiana. This week, that bill will move on to the Republican-controlled Senate, which is expected to pass the plan.
Central Indiana's share of the proposed $3.85 billion bid would be used for more than 30 Indiana Department of Transportation projects, totaling more than $972 million, according to an Indianapolis Star analysis. An additional $28 million-plus would be provided to municipalities for local road projects.
INDOT plans to use $700 million of the lease money to help fund the $2 billion extension of I-69 from Indianapolis to Evansville. The Indianapolis region likely could receive more of the lease money than the Toll Road counties, depending on how much of that I-69 money is spent in Marion, Johnson and Morgan counties.
If the governor's plan to lease the Toll Road is not successful, the status of all projects in the state's pipeline would be re-evaluated. In addition to the $3.85 billion in lease money, the governor's Major Moves plan calls for other road improvements that would be funded through existing revenue or an increase in tolls.
Rep. Michael B. Murphy, R-Indianapolis, rebutted claims that Central Indiana would receive an unfair share of funds .
"I think 20 percent of the state's population lives in Indianapolis, and that's not even counting the surrounding counties. It's obviously the economic core of our state," Murphy said.
"I grew up in the shadow of the Toll Road in South Bend, and while I respect my friends from up there, I think the governor is fairly dividing the money."
Central Indiana's share
Nearly half of the money slated for the Indianapolis region would go to Marion County -- more than $450 million. That would include $235 million to expand I-465 between U.S. 31 and Fall Creek in Lawrence.
Rep. Gregory W. Porter, D-Indianapolis, said he's glad projects in the metro area are going to be funded but argued it could happen without leasing the Toll Road.
Instead, he said the Democrats' preferred method of bonding for $2 billion could have done the trick. Plus, he said, most of the projects were scheduled before Daniels took office.
"Great, we have all these projects now, but they were on the table already to begin with," Porter said. "The new administration came in, took them off the table and are putting them back on.
"Why do I need to be grateful?"
Because otherwise, the projects would not be completed for a long time, said Rep. Gerald R. Torr, R-Carmel.
"There is no funding currently," Torr said. "Going forward, there's just no reasonable expectation that all these projects would get done."
Some of the other major local projects include the $51 million widening of I-70 in Hancock County, the $150 million expansion of U.S. 31 in Hamilton County and the $230 million improvement of I-69 from I-465 through Noblesville.
"This money is critical, not only for us in Fishers, but the entire Central Indiana region," said Fishers Town Council President Scott Faultless, a Republican.
"The improvements to I-69 in the northeast corridor are essential for continued growth and job creation in Central Indiana."
Toll Road counties balk
But the money is coming, in part, from toll-paying commuters from Indiana's northernmost counties, said Hammond Mayor Thomas McDermott Jr.
"This Toll Road lease targets the most northern part of the state and spreads our tolls and our money around to the rest of the state," McDermott said.
"It's fundamentally unfair."
The fears that one part of the state will benefit more than others have been fanned by Democratic claims that the governor's plan doesn't add up. House Minority Leader B. Patrick Bauer, D-South Bend, said the governor has promised to complete so many projects that even if the state is successful in leasing the Toll Road for $3.85 billion, there won't be enough money to build all the roads.
Bauer said he has estimated Daniels has "overpromised" by $1.6 billion.
"If he has a problem," Bauer said, "he just promises a lot of money."
Daniels said there not only is enough money to complete all of the projects, there likely will be money left over.
"Overpromises is the problem we're trying to solve," Daniels said. "There were more than $2 in promises for every dollar the state had, and that problem sat there for 16 years and nobody solved it.
"Now we have a solution in hand."
Charles E. Schalliol, the state's budget director, said preliminary estimates show that by the end of 2015, there should be more than $1 billion left over after all of the Major Moves projects are done.
He said that's "assuming 4.5 percent earnings on our money" for a total estimated interest of $1.15 billion over 10 years.
"It's not like when the bill gets over to the Senate, there's a lot of extra money to be spent," Schalliol said. "But our estimates suggest that right now it looks like we have money to do everything that's been talked about, with some left over."
Those in the Toll Road counties want more money left over for them and less for Indianapolis.
But McDermott fears Northern Indiana's fate has been sealed.
"This is an unfair deal," he said. "But it's a done deal."
Call Star reporter Bill Ruthhart at (317) 444-2770.
Star reporter Mary Beth Schneider contributed to this story.