Penn Governor: Help me kill Office of Public Benefit

Edward Rendell, speaking today at Infrastructure Investor: New York, warned a proposal in House Transportation and Infrastructure Committee Chairman Jim Oberstar's transportation bill would have a ‘chilling effect’ on private investment in infrastructure.

A prominent US politician today urged investors to oppose the creation of an Office of Public Benefit to oversee public-private partnerships (PPPs) for federal highway projects in the US – a measure backed by House Transportation and Infrastructure Committee Chairman Jim Oberstar but opposed by much of the infrastructure industry.

“We must stop the Office of Public Benefit from being created,” Pennsylvania Governor Ed Rendell told delegates gathered today on the second day of the Infrastructure Investor: New York forum. Rendell argued that “the Office of Public Benefit will have a chilling effect on private investment in infrastructure”.

Under the $500 billion, six-year transportation reauthorisation bill proposed by Chairman Oberstar, the Department of Transportation would be required to create an Office of Public Benefit within the Federal Highway Administration to oversee federal requirements for PPPs on the nation's highway system. The agency would be charged with reviewing and approving PPP arrangements as well as states’ plans for toll increases on federally funded highways.

We must stop the Office of Public Benefit from being created

Gov. Ed Rendell


Rendell said these powers would essentially amount to a veto power over PPPs on the nation’s highways, posing a hurdle to private investment just at the time when the US needs it most. In 2008, he attempted a PPP for the long-term lease of Pennsylvania’s 537-mile turnpike.

Rendell’s comments came on the last day of the US government’s current fiscal year, which means that many government programmes, including transportation, are due to expire at midnight unless they are re-authorised for the following fiscal year starting tomorrow.

Ed Rendell

As of press time, Chairman Oberstar was urging the US Senate to pass a three month reauthorisation of the current transportation spending programme known as SAFETEA-LU (Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users). Last week the House passed the same legislation in an effort to put pressure on Congress to pass a longer-term, multi-year reauthorisation measure before the end of the year.

Rendell told delegates at today’s conference that Congress will most likely take up debate of the reauthorisation after the mid-term elections scheduled for 2010, meaning that an 18-month reauthorisation of SAFETEA-LU was most likely.

Still, Rendell urged investors not to wait and get on with their opposition to the Office of Public Benefit and “get on it now”.

Rendell also had some kind words for Chairman Oberstar. Among other things, the former Philadelphia mayor praised Chairman Oberstar for allocating $500 billion toward transportation – more than any other previous transportation bill in US history.

But even that amount, Rendell said, will prove inadequate. He cited the US’ transportation funding gap, as measured by the American Society of Civil Engineers, at $2.2 trillion over the next five years.

“The gap is so enormous that we have to use every weapon in our arsenal,” he said, adding: “We have got to unleash the power of private investment in every way possible.”