Illiana Boondoggle Now Guaranteed to Cost Taxpayers At Least $250 Million

Gantry on Triangle Expressway
A recent agreement mandates electronic tolling for the Illiana, with no cash payment option. New toll roads, like this one near Durham, N.C., have electronic tolls and traffic counts far below expectations. Photo: NC DOT/Flickr

Remember the “innovative” public-private partnership Governor Quinn lauded as a way to build the “21st century” Illiana Expressway, without shifting the entire cost onto the general public? Or remember CMAP’s statement opposing the project, based on its contradictory growth projections, overestimated benefit to the region, and severe financial risk, and the multiple op-eds and articles that followed, all expressing concern about the expressway’s ability to garner enough toll revenue to pay for itself?

It appears that the Illiana project, extolled by the governor and IDOT as a way to invigorate the south suburban economy by building a privately-financed and operated expressway, will actually involve even more public dollars than we imagined.

The terms of the public-private partnership devised for the Illiana have already been condemned in the local media. The project’s backers cite the eventual selection of a private developer to design, construct, and operate the expressway as a way to relieve the public from paying for the project; indeed, its “private financing” is perhaps why the project could even be contemplated by a state with huge debts. But a Toll Sensitivity Analysis [PDF] released by IDOT last November shows that the Illiana will cost four times as much to drive on as nearby tollways. Any business would have a hard time staying open by charging four times as much as nearby, more convenient competitors.

Unless that business is road building in Illinois, of course. An agreement between Illinois and Indiana now commits a minimum of $250 million in Illinois dollars to the project. Indiana’s DOT has also committed $80–$110 million to the project; together, this amounts to at least a third of the project’s currently projected cost of $1 billion. If toll revenue fails to live up to expectations, the public may be on the hook for much, much more.

Is IDOT trying to sweeten the deal to attract road developers by promising a minimum amount of public funds upfront? What more could be done to make the project palatable to a developer, when both states have already made it clear that they’ll pay up to the entire cost?

Public-private partnerships make sense when there’s a good chance that the risks of the project will be shared — rather than just placing all the risk on the public sector and all the rewards on the private sector. As the number of vehicle miles traveled has fallen over recent years, other toll roads built using public-private partnerships have fallen far behind on revenue expectations. With Illinois’ transportation fund perilously underfunded and about to expire, it makes little sense to further burden it with a new, money-losing road. IDOT must know this, which is why they’re offering hundreds of millions upfront (plus untold billions in guarantees) to court builders.

ALSO ON STREETSBLOG

MPC: Funding the Illiana Expressway Would Be a Big Mistake

|
The Metropolitan Planning Council, a non-profit promoting economic development strategies for Chicagoland, has come out strongly against the Illiana Expressway, a 47-mile highway the Illinois Department of Transportation has proposed for the rural communities of southern Will County and northwestern Indiana. MPC released a statement yesterday highlighting numerous shortcomings in IDOT’s proposal, including vague financing […]
STREETSBLOG USA

The Illiana Expressway Will Eat Itself

|
The Illiana Expressway fails on all measures — expected revenue, projected traffic — when looked at realistically. Unfortunately, Illinois and Indiana don’t look at it that way. Image: Parsons Brinckerhoff A recent report by U.S. PIRG and the Frontier Group, “Highway Boondoggles: Wasted Money and America’s Transportation Future,” examines 11 of the most wasteful, least […]

Illiana Forced Into CMAP Regional Plan By Springfield, Suburban Reps

|
The Chicago Metropolitan Agency for Planning’s MPO Policy committee today approved the Illiana Tollway, among other projects, as part of GO TO 2040, which the agency calls “the comprehensive regional plan… for sustainable prosperity through mid-century and beyond.” Committee members representing Chicago, Cook County, and McHenry County, which together are home to almost two-thirds of Chicago […]

Rauner Authorizes More Illiana Spending to “Wind Down” Project

|
Governor Bruce Rauner signed a bill last week that authorizes spending $5.5 million more on the Illiana Tollway, a month after he announced he was suspending the project. The Illiana would have been a new highway a couple miles south of the existing Chicago metropolitan region that would have encouraged suburban sprawl. Tolls would have been […]