Elected officials from northern Indiana, most prominently Democratic U.S. Sen. Joe Donnelly, have urged state government to reclaim the Indiana Toll Road after its private operator went bankrupt.

Not a chance, Indianapolis replied.

Indiana Public Finance Director Kendra York wrote a letter back to Donnelly saying the state has no plans to reclaim the Toll Road just because the Indiana Toll Road Concession Co., a Spanish-Australian consortium, has filed for bankruptcy in a bid to sell off the 157-mile tollway after racking up about $6 billion in debt. The state wants to stick with a private operator so the Indiana Department of Transportation does not assume responsibility for the road's maintenance. 

Earlier this month, Donnelly wrote the Indiana Finance Authority urging it to take advantage of its leverage in federal bankruptcy court to address longtime problems such as half hour-long wait times at toll plazas, filthy travel plazas and the bridge to Interstate 94 in Portage that has been down for more than a year. The LaPorte County Commissioners even hired a bankruptcy attorney to investigate whether the 75-year lease allowed the state to retake daily operations of the Toll Road, as former Gov. Mitch Daniels repeatedly claimed it would.

The state, however, is not interested in assuming the cost of running and maintaining the Toll Road, York wrote. Indiana would have to spend far more now than the $68 million it did over the last two years of state control.

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"In sixty years of state operation, the Toll Road never covered its costs," she wrote. "In 2005, the year before the road was leased, the state of Indiana did not collect sufficient tolls to support basic road treatments, or repair the deteriorating conditions of the highway and bridges. These improvements could not have been undertaken within INDOT's budget without neglecting other parts of the state highway system."

The state government, which is often harped on by region residents for neglecting roads and highways in the densely populated northwest corner of the state, had not increased the tolls on the Toll Road for 20 years at the time. The lease to a private operator calls for tolls – now $10 for a car traveling the whole length of the tollway – to increase by a set amount every year. 

After eight years of toll hikes, the Toll Road's underlying profit margin, taking away debt payments, is estimated to be about about 82 percent. The tollway could be a cash-generating machine that would fund road projects not just in Northern Indiana, but across the state, Donnelly said.

Since taking over in 2006, the Indiana Toll Road Concession Co. has invested $450 million in safety and infrastructure improvements on the Toll Road, and plans to do $30 million more. The Indiana Finance Authority has been working with the operator to address complaints about the travel plazas.

"I appreciate that the Indiana Finance Authority shares my concern about the substandard conditions of the Indiana Toll Road and travel plazas," Donnelly said. "Hoosiers deserve better. It is important that the IFA uses its authority to ensure that the toll road is managed and operated appropriately and that passengers traveling across our state have access to safe roads and quality services."


Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.