Codey weighs selling highway to boost transit fund

Friday, June 10, 2005
Star-Ledger Staff

Acting Gov. Richard Codey is considering the possibility of selling or leasing the state's toll roads to raise money to solve New Jersey's transportation funding crisis, said his spokeswoman, Kelley Heck.

Officials said the governor is hoping that revenue from selling the New Jersey Turnpike or Garden State Parkway would offset the need for an increase in the state's gasoline tax.

Codey initially raised the idea of selling the Turnpike back in January as a way to balance the state budget. In February, he changed his mind somewhat, saying the proceeds from privatizing the roads might be used to replenish the Transportation Trust Fund, which pays for large highway and mass transit projects.

 Since then, the Codey administration has not moved forward with any detailed financial or legal analysis on selling the toll roads, officials said.

"This is just a preliminary stage," Heck said. "It's too early, too preliminary."

Heck said an in-depth review of the idea would begin sometime after passage of the state budget, which is due June 30.

"The idea has been discussed," said Marc LaVorgna, a spokesman for the state transportation department. "It's one of many options that will be explored."

By next June, the Transportation Trust Fund will run out of money for new projects, with all its money going to pay off its escalating debt. In order to sell the toll roads to raise money for the fund, state officials would need to deal with several key issues.

First, the purchase price would have to cover the Turnpike's current debt, which is about $5 billion. It also would have to generate enough money to pay for $1.5 billion in widening projects Codey is planning for the Turnpike and Parkway. Moreover, there would have to be enough money for the ongoing operation of the toll roads.

Finally, the privatization would have to produce enough money to replenish the trust fund, which cranks out more than $1 billion in highway and mass transit projects per year.

Last year, officials in Illinois reaped $1.8 billion by leasing the Chicago Skyway. That deal imposes limits on how much the private company can raise the tolls.