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An Ohio advocacy group is asking whether privatization of the Ohio Turnpike is the best option for taxpayers, warning that it could end up costing travelers and the state too much money.
During a conference call Thursday morning, the Ohio Public Interest Research Group discussed its report that outlines eight questions that should be asked while discussing possible plans for the turnpike, a 241-mile toll road that stretches across northern Ohio.
Gov. John Kasich is considering leasing the turnpike over a period of years or issuing bonds against it to help pay for the state’s infrastructure projects. Officials say the state is short $1.6 billion for needed infrastructure, with 23 major projects delayed as much as 13 years.
One question the public interest group report raises is whether a leasing contract would include a non-compete clause that would discourage improvements to roads that would take people off the turnpike.
“Leases could just say, ‘if you do improvements on other roads, you have to pay us for what knocks down our profit,’” said Tabitha Woodruff, an advocate for the Ohio Public Interest Research Group.
Phineas Baxandall, a senior policy analyst for the group, said a privatization proposal might not make as much sense as issuing bonds.
“A privatization proposal is in some ways less efficient than that because if there’s one thing the public sector can do at low cost, it’s borrow money cheaply,” he said.
A state-financed, $2.85 million study of the future of the turnpike by Texas-based consultant KPMG Corporate Finance is expected by year-end.
The CUT Loopholes Act would put an end to the price and profit shifting that allows publicly traded companies to engage in pervasive tax avoidance.
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