Two teams said to have bid on Pa. Turnpike

At least two teams of private investors and operators have offered about $12 billion to lease the Pennsylvania Turnpike, sources said yesterday.

A third team, the operator of Chicago and Indiana toll roads, may not have submitted a final bid because of financing difficulties.

Gov. Rendell is to announce the successful bidder next week, perhaps as early as Monday. Any proposal to lease the turnpike will require legislative approval, and legislative leaders have said the proposal faces tough sledding.

Teams bidding to operate the turnpike are said to include a consortium of the New York investment bank Goldman, Sachs & Co. and the Australian toll-road operator Transurban Group, and a consortium of the Spanish toll-road operator Abertis Infraestructuras, the Australian investment and advisory firm Babcock & Brown, and New York-based Citigroup Inc.

A third would-be bidder, the team of Macquarie Infrastructure Group of Australia and Cintra Concesiones de Infraestructuras de Transporte of Spain, was reported to have freed its bankers to talk to other bidders. Macquarie-Cintra is the private operator of the Indiana Toll Road and the Chicago Skyway.

The bids are said to be in the range of $11 billion to $12 billion for a 75-year lease of the 359-mile main turnpike and the 110-mile Northeast Extension.

That's at the low end of the value range predicted last year by Rendell's financial adviser, Morgan Stanley. Morgan suggested that the toll road might bring from $12 billion to $18 billion.

Rendell spokesman Chuck Ardo declined to comment on the bids received yesterday.

Under the administration's plan, the turnpike would be leased for 75 years to a private operator, which would be allowed to raise tolls 25 percent next year and 2.5 percent or the rate of inflation every year after that.

If approved, the lease would mean the end of embattled efforts to add tolls to I-80 as a way to raise transportation money.

The administration instead would invest the multibillion-dollar lease payment and use the proceeds to pay for highway, bridge and transit projects.

The proposal to lease the turnpike faces stiff opposition in the legislature, which rejected the proposal last year. Instead, it approved a measure empowering the Turnpike Commission to raise tolls on the turnpike and install tolls on I-80 across northern Pennsylvania.

That law, Act 44, quickly drew heavy opposition from rural legislators, businesses and residents, who argued that tolls on I-80 would cripple their economy. And I-80 tolls would require approval from the U.S. Department of Transportation, which remains uncertain.

Administration officials expect investments from the proceeds of a turnpike lease to generate at least as much as would be produced by Act 44: $945 million per year, averaged over the next 10 years.

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