Colorado Toll Road Goes Private

<p>The Northwest Parkway Public Highway Authority, owner of Colorado's newest toll road (opened 2003), has finalized the bid for leasing the 11-mile road after revenue did not match expectations.</p>
April 18, 2007, 7am PDT | Irvin Dawid
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The Board of Directors of the Northwest Parkway Public Highway Authority, representing the three cities and counties the financially troubled roadway serves, had solicited bids from 11 investment firms and toll-road operators. They have selected a team of companies from Portugal and Brazil as the winner in a bid to operate the road which links the E-470 toll road with U.S. 36, under a long-term leasing arrangement.

"With toll revenues lagging original projections, Northwest Parkway officials began the search last year for private investors who might have a longer investment horizon and be able to weather the road's slower-than-expected move to financial stability.

Executive Director Steve Hogan said the parkway, which is owned by Broomfield, Lafayette and Weld County (sic), still is "on track" for a leasing arrangement that would retire about $416 million in bond debt and transfer financial risk to the private sector bidding team."

"They (the team of Brisa Auto-Estradas de Portugal S.A. and Companhia de Concessões Rodoviarias, of São Paulo, Brazil) are one of the largest toll-road operators in Europe," said parkway Executive Director Steve Hogan, adding that the parties will negotiate financial terms of the deal over the next 30 days."

"Governments have discovered that they can get billions of dollars in payments for other road construction and maintenance from their busy toll roads, which offer private investors a steady source of income over many years.

"The Northwest Parkway's leasing model is different from established toll roads because it does not yet have a robust flow of cash or the dense development in its corridor that would increase use of its toll lanes."

{Editor's note: It would appear that unlike the much acclaimed leases in Chicago (Chicago Skyway) and Indiana (Indiana Toll Road), the Authority will use the 'lump sum payment' to retire private debt used to finance the toll road, similar to the example of Virginia's Pocahontas Parkway}.

Thanks to Albert G. Melcher via Sierra Club Transportation Forum

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Published on Tuesday, April 10, 2007 in The Denver Post
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