Group promoting infrastructure privatization spurred on by toll highway lobbyists
Let’s build the infrastructure is preparing to officially launch in Washington, DC, next week with a six-figure advertising blitz focused on lobbying lawmakers to use privatization, rather than taxation, to pay for infrastructure proposals being debated in Congress.
The organization touts public-private partnerships and a process known as ‘asset recycling’, in which the government funds new construction and repairs by selling or leasing roads, bridges, water services, parking lots and other infrastructure assets to private entrepreneurs instead of paying for them with public funds. Private operators in turn recoup the costs by adding tolls or increasing user fees, such as water bills or parking fees.
The new group, led by two former mayors, Republican Mick Cornett of Oklahoma City and Democrat Michael Nutter of Philadelphia, have posted virtually no information about their supporters on their website or how they are paying for the wave. television commercials.
There is little information about Let’s Build Infrastructure on the Internet. The website was registered anonymously in June and leaves no trace of its funding sources. Cornett and Nutter did not respond to requests for comment.
But a body of evidence, including social media posts as well as nonprofit and lobbying company registration documents, suggests toll highway operators are affiliated with the pro-privatization push.
In 2019, Hans Klinger, a registered lobbyist for toll highway operator Cintra, the US subsidiary of Spanish infrastructure conglomerate Ferrovial, SA, was director of a non-profit organization called Invest in Texas Roads Now. . The group has promoted a partnership to build six new toll lanes on a freeway near Dallas on Interstate 635 and four on Interstate 35 in Texas.
The website for Investing in Texas Roads Now redirect now at Let’s Build Infrastructure, and the two groups share the same website language, header graphic, and logo design.
Klinger, who did not respond to a request for comment, was the first and only person to retweet the Twitter promotion for Let’s Build Infrastructure before the group was unveiled to Politico this week. Black Diamond Strategies, the consulting firm in which Klinger is a partner, is registered represent Cintra on issues related to public-private transport partnerships.
Cintra has faced controversy over the years over its management of America’s toll roads. In Indiana, the company more than doubled the price of cash-paying cars to drive the Indiana Toll Road from $ 4.65 to $ 9.40. The 75-year lease to operate the road raised eyebrows at the time. But the fall in traffic, due in part to high toll costs, has led to bankruptcy for the project in 2014.
The company was again faced with a backlash in North Carolina after the Interstate 77 Express project, which allowed a consortium led by Cintra to collect toll money for 50 years in exchange for building and operating the tracks. Motorists have complained about uneven pavement, confusing lane design and Cintra’s “dynamic toll,” which uses congestion factors to increase tolls by up to $ 7 to $ 10.
The group promoted by Cintra appears as Senate negotiations on the role of public-private partnerships in infrastructure have reached a critical point. Dueling proposals over the size, scope and funding of infrastructure legislation are making their way to Congress.
Many Democrats converged on a plan funded by a mix of IRS enforcement, a higher capital gains tax for higher income earners, a higher marginal tax increase for those with higher incomes. high income households and a mix of corporate income taxes. These funds will be used to directly pay for the expansion of broadband, electric vehicle infrastructure, modernization of airports and land transport, and other investments.
But a rival proposal, supported by Sens. Kyrsten Sinema, D-Ariz., And Rob Portman, R-Ohio, released a bipartisan plan that relies less on taxes and more on the kind of public-private partnerships that would benefit companies like Cintra. The Biden administration explicitly read senators’ demands lists “Public-private partnerships, private activity bonds, direct payment bonds and asset recycling for infrastructure investments” as key to funding the alternative proposal.
Recently released lobbying information shows that other toll highway operators and investors are trying to influence congressional negotiators. Transurban, a controversial toll operator who charged as much as $ 30 for pricing congestion on its routes in the Washington, DC area, is pressure On the bill. The Global Infrastructure Investor Association, which represents the interests involved in the privatization of water and transport, is also to attempt to influence legislators.
In an opinion column announcing the effort, Cornett and Nutter wrote for The Hill that public-private partnerships are simply a cost-effective way to bring those with the most expertise into the process of rebuilding infrastructure. aging of America.
“The agreements are designed to incent private operators to foot the bill for repairing and maintaining existing infrastructure, as well as building new projects, leveraging expertise that government officials simply do not have.” , wrote the mayors.
The couple also suggested that such arrangements are best for the public and come with little risk or cost. “The state and the taxpayers are fully protected, and the road always remains the property of the state,” the two wrote. “Funding these vital projects is no small feat and should not depend solely on tax increases and new borrowing. “
The recent toll, however, is less than the rhetoric. In an infamous public-private deal, Chicago leased the city’s parking meters to a group of investors, who quickly hiked the fees by 800%. The lease agreement also required the city to pay investors whenever a parade or street fair restricted parking. The agreement will last until 2083.
In an infamous public-private deal, Chicago leased the city’s parking meters to a group of investors, who quickly hiked the fees by 800%.
In 2012, private investors bought a lease on water services in Bayonne, New Jersey, and Middletown, Pennsylvania. New operators quickly started increasing water utility bills every year, and by 2019 water prices had risen by more than 50%.
Even the success stories featured on the Let’s Build Infrastructure website are loaded. The organization touts the work of the San Antonio Water System, a water utility, which has reached an agreement with a private operator to expand the capacity of the pipeline to serve residents of the city. Residents are already facing nearly 10 percent increase in water bills to help pay for the project.
Nutter, the co-chair of the new group, has his own ties to the interests of infrastructure privatization. He is an advisor to the law and lobbying firm Dentons, which maintains a practice on public-private transport partnerships. The former mayor of Philadelphia also recently served as a paid director on the board of directors of Conduent, a toll road operator who has in the face of scandals through the country for motorists overcharging.
In the press release announcing the group, Nutter is boasted as an expert and advocate for American infrastructure, although his recent work for a toll road operator is omitted from his Biography.