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By privatizing roadways, officials hand over significant control of regional transportation policy to people only accountable to their shareholders, according to a study done in 2009 by the U.S. Public Interest Research Group.
PIRG also says upfront payments that states receive are often worth far less than the value of future toll revenue from the roads. Analysis of toll roads in Indiana and Chicago found that private investors would recoup their investments in less than 20 years, but since the deals are for 75 and 99 years, respectively, the public got far less for their assets than they are truly worth, PIRG said.
"Private investors also want long-term assurances about the revenue they will collect for future decades," said Phineas Baxandall, a senior analyst for tax and budget policy for PIRG. "These assurances tend to restrict what kinds of policies the state can pursue or force the state to compensate the private investors in case public policies infringe on that revenue source."
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