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Governor considers leasing Ohio Turnpike to private operator

Proceeds won't be used to offset budget shortfall

The possibility of leasing the Ohio Turnpike to a private operator will be considered by Governor John Kasich, but the proceeds of any such deal would not be used to help reduce the huge general fund budget shortfall facing the state.

During a recent press conference, Kasich said that even if the 241-mile toll road is privatized, the proceeds would be devoted to paying for infrastructure improvements and other long-term needs.

"If we look at the turnpike and find we’re in a bad market and we’re not going to get the numbers that we want – I have a number in my head as to what would work – if we don’t get that number, we’re not going to do it,” Kasich said.

“And I don’t want to use these dollars to patch a hole because that’s sort of like using one-time money,” he said.

Revenue from privatizing the turnpike could be split between infrastructure needs and “an annuity or revenue stream that we could use to, you know, take care of needs as we see fit. But you just don’t want to go and blow all that money,” he said.

The state faces an estimated $8 billion revenue shortfall in the general fund budget for the biennium beginning July 1, and Kasich has said repeatedly that tax increases are off the table, so he and legislative leaders will be looking under every rock for ways to cut state spending.

One of the areas almost certain to be targeted for spending reductions is debt service for capital improvements.

Under normal circumstances, a new two-year state capital improvements budget bill would have been passed in 2010, and it would have provided bonding authority for nearly $2 billion in capital projects for state agencies and institutions of higher education.  It also would have included $100 million in cash for "community projects," local pet projects such as art museums, parks and other initiatives.

But with the general revenue fund budget crunch looming and a legislature stocked with new lawmakers who campaigned for reduced government spending and lower taxes, curbing debt payments seems to be a high priority.

New Senate President Tom Niehaus (R-New Richmond) said that while the matter hadn’t been fully discussed with the incoming administration, he foresaw a minimalist approach to the next capital measure.

“I would expect that there will be some kind of a capital bill because there are some things we have to do to maintain the buildings,” he said.

“I would be very surprised if there are any community projects as part of the capital bill, and I would expect that any capital bill that we do is going to be smaller than what we might have anticipated two years ago,” Niehaus said.

Mike Dittoe, spokesman for House Speaker Bill Batchelder (R-Medina), said the speaker and House Finance Chairman Rep. Ron Amstutz (R-Wooster) had a similar take on the issue.

“Given the dire budget situation that we face currently, they also agree that there’s a very, very remote chance that there will be any new money for new capital projects,” he said. “They are largely in agreement with President Niehaus.”

“That’s where they’re leaning at this point,” he added. “Once the Finance Committee has a chance to delve into the budget in greater detail after it comes from the governor’s office, that’s when we will be able to make the fullest assessment on whether or not there will be a capital bill.”

Gongwer News Service

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