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Statement of Serena Unrein, Public Interest Advocate for the Arizona PIRG Education Fund, to the Maricopa Association of Governments (MAG) Transportation Policy Committee:
“As the Transportation Policy Committee and the Maricopa Association of Governments enters into a policy discussion about public/private partnerships in the region, I encourage members of the committee to use the privatization principles Arizona PIRG Education Fund has formed to protect the public interest in these deals.
While road privatization can offer a hard-to-resist “quick fix” for the transportation budget challenges we face in Maricopa County and across the state of Arizona, poorly done deals can have hidden costs and big potential downsides for the public.
Private toll road operators seek to maximize their profits. But what’s good for business isn’t always good for motorists or for transportation policy in general. For example, the state of Indiana was forced to pay the private operator of the Indiana Toll Road more than $400,000 for waiving tolls to speed evacuations after a flood. And privatization contracts can financially encourage bad transportation policy. One toll road contract in Texas provides the state with a financial incentive for increasing the speed limit from 70 to 80 miles per hour.
To protect the public interest, the Arizona PIRG Education Fund recommends that existing roadways not be privatized and that private deals to construct new roadways be allowed only under the following conditions:
- The public should retain control over decisions about transportation planning and management.
- The public must receive full value so future toll revenues won’t be sold off at a discount.
- No deal should last longer than 30 years because of uncertainty over future conditions and because the risks of a bad deal grow exponentially over time.
- Contracts should require state-of-the-art maintenance and safety standards, instead of regional minimums.
- Complete transparency and public disclosure are needed to ensure proper public vetting of privatization proposals."
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