Although Ohio Gov. John Kasich keeps talking about selling/leasing the Ohio Turnpike, the Indiana Turnpike privatization of a few years ago is looking like a huge mess for drivers and the investors.
TollRoadNews:
Debtwire, a London Financial Times wire service claims the Indiana Toll Road Concession Company (ITRCC) is in danger of defaulting on its debt as early as the first months of next year (2012). The wire says ITRCC has been rapidly "burning through" an interest reserve account which threatens to put it out of compliance with reserve provisions of its $4.1b in bonds.
The principal lender to ITRCC is the Royal Bank of Scotland which Debtwire says has assigned the loan to its "workout" department. The wire report says the interest reserve account could be depleted by the end of 2011.....
....Traffic and revenue have been well below expectation since the 75 year concession was signed with the state of Indiana at the height of the boom in June 2006. Toll revenues in 2010 were $164.2m versus interest expense on debt of $268m....
There are plenty of details and numbers on how the Indiana Toll Road has been a complete disaster for the investors in the TollRoadsNews.com issue. This fact alone may make a sale/lease of the Ohio Turnpike a losing proposition for an investment firm or new private owner.
Drivers on the Indiana toll road have faced an increase in tolls. Some truckers are avoiding the Indiana road entirely.
