There’s a debate in Congress.  There’s a debate in Congress between Chicago’s two senators.  There’s a debate in Congress between Chicago’s two senators about privatization.

Last week, Bob Sechler of the Wall Street Journal described newly introduced legislation from Senator Dick Durbin (D-Ill) called “The Protecting Taxpayers in Transportation Asset Transfers Act.”  The bill seeks to require that U.S. government money spent on state and local transportation projects be repaid before the assets are leased or sold to private operators.  In Sechler’s words, this could “potentially crimp[ ] the ongoing national push toward privatization.”   The bill could create a federal lien to project the public’s investment:

Under the bill, a federal lien would be attached to all transportation projects that have received more than $25 million in federal funding, or that are valued at more than $500 million and have received federal funding. The lien wouldn’t be released until the money is repaid, based upon a depreciation formula, and “the parties agree to take action to increase transparency and public input in the privatization transaction.”

Already, Jon Hilkevitch of the Chicago Tribune is reporting about a new plan to be unveiled this morning by Senator Mark Kirk (R-Ill) that challenges the method of investment proposed by Senator Durbin.  Under the proposed “Lincoln Legacy Infrastructure Development Act,” Senator Kirk and his co-sponsors want to make it easier for governments to lease public transportation assets or enter into partnerships with private companies to build them.

If you are involved in the transportation construction industry, this is a fight worth watching.  The two pieces of legislation go the heart of the debate: that is, What is the proper balance of the private-sector’s role in constructing roads, airports, railroads and other transportation facilities?   On one end of the spectrum is the importance of protecting the public’s share of investment before major transportation projects are leased or sold.  The counter-concern is to eliminate barriers for innovative funding for highways, bridges and other infrastructure at a time when there is little to no public funds available.

I previously wrote about whether PPPs could help revive highway and bridge construction.  I have also written about some problems with partnering on construction projects, whether you are talking about PPPs or some other partnership arrangement between owners/developers and contractors.  This will continue to be a debate in the political halls, but doing nothing is not an option.

Image: Thomas Hawk