A Sunday July 5, 2009 article in the Dallas Morning News discussed the toll road authority problems in Texas and included Venable partner Jim Burnley's comments on the national scope of toll road funding.
According to the article, lawmakers left the Texas Capitol on Thursday after refusing Gov. Rick Perry's pleas to extend the state's authority to enter long-term contracts with private toll-road developers. The state's authority to strike new toll road deals expires on August 31.
Recently, states such as New York, Florida and Virginia have expanded the legal authority for toll roads, but the deals have not necessarily followed. Existing toll roads are also being confronted by sagging traffic and huge debts.
Burnley, who served as U.S. Secretary of Transportation under President Ronald Reagan, said Wall Street's appetite for the highly leveraged toll road deals has waned.
There is significantly less capital available for those kinds of investments, he said.
"Virtually all of the public-private deals that have been seriously discussed in the past decade have involved significant leverage," he said. "As we return to a more normal economy those kinds of deals will be attractive again. But lenders [may] continue to be more conservative for many years to come, reducing availability of capital for infrastructure."
Because the need for highways is so much more than the available tax funds to pay for it, private toll roads will continue to be important, Burnley said. "But they will play a reduced role."