Report Shows Dangers of Private Toll Roads; Proposed Knik Arm Bridge Would Turn Region’s Transportation Decisions Over to Private Investors

Anchorage, AK - A new US Public Interest Research Group (US PIRG) report, Road Privatization: Explaining the Trend, Assessing the Facts, and Protecting the Public, clearly describes the loss of public control experienced by states and regions that pursue public private partnership (P3s) without sufficient safeguards in place. The Knik Arm Bridge and Toll Authority (KABATA), an Alaska legislature-created bureaucracy of less than ten people, is expected to sign a P3 contract with private investors for this $1 billion project within the next year.

Legislation passed by the Alaska legislature in 2003 and 2006 creating KABATA provides few of the safeguards needed to ensure that the P3 contract is in the best interest of the State of Alaska and Anchorage and Mat-Su Borough residents. Unlike the Alaska Gasline Inducement Act signed by Governor Palin in June 2007, the KABATA statute does not require public review, comments on the draft contract, and legislative approval of the final contract. Additionally, the affected communities of Anchorage and the Mat-Su Borough are not required to sign-off on the final contract or on scheduled toll increases. Also increasing the risks, the statute would allow for a concession deal to give toll monies to a private operator for an unlimited number of years, rather than the 30 years recommended in the US PIRG report.

“US PIRG’s report, based on the experience of other states and authored by Phineas Baxandall, Ph.D., gives recommendations on how not to be fleeced by the Knik Arm Bridge Public Private Partnership process. The current Knik Arm Bridge P3 process deserves extensive scrutiny by the media and state and local elected officials,” stated Lois Epstein, Director of the Alaska Transportation Priorities Project, located in Anchorage.

“This important report has enormous implications for the proposed Knik Arm Bridge project,” said Steve Cleary, Director of AkPIRG in Anchorage. “We need to change the Knik Arm Bridge statute to ensure that the bridge authority is open, transparent, and accountable to the state and the region’s residents.”

“Without greater public involvement in the bridge authority’s decisions, the state, Anchorage, and the Mat-Su Borough risk ceding control of toll rates, bridge maintenance, and other important decisions to the private sector,” added Epstein. “Additionally, despite public investment in the proposed bridge, all toll money likely will go to the private investors.”

The US PIRG report is available upon request or on the web: here

Phineas Baxandall, Ph.D., author of the report, is available to answer questions via email at phineas@pirg.org

or by cell phone (857) 234-1328.

Download: Press Release, October 2nd, 2008 (MS Word, 33k)