THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, January 26, 1996 TAG: 9601260534
SECTION: LOCAL PAGE: B4 EDITION: FINAL
TYPE: Virginia News
SOURCE: ASSOCIATED PRESS
DATELINE: STERLING LENGTH: Medium: 71 lines
The General Assembly is considering a bill that would allow the Dulles Greenway to obtain federal highway loans, even though the private toll road was never supposed to ask for government help.
Del. Vivian E. Watts, D-Fairfax, introduced the bill this week that would allow the state to provide the road company with free services and issue loans using federal transportation money.
Government involvement was never envisioned when the $326 million project began in the late 1980s as the nation's first privately built highway in modern times. The law that authorized the venture prohibited the state from bailing it out if financial problems arose.
But traffic on the 4-month-old highway connecting Leesburg with Washington Dulles International Airport is averaging only 10,500 vehicles a day. The company's financial plan was based on an estimate of 34,000 drivers a day by the end of the road's first year of operation.
The shortfall in toll proceeds has put the company in danger of missing construction loan payments. If it cannot renegotiate terms or find other financing, it faces having to surrender the road to creditors.
Watts said she introduced the bill at the request of the road's owners to provide them with more financial flexibility.
The measure would remove the company from the oversight of the State Corporation Commission, which regulates banks, utilities and insurers, and place it under the Transportation Department under the auspices of a 1995 law governing privately built roads. Watts said that would help the company restructure its debt.
``By setting it up under the more typical arrangement nationwide, it just puts them in a better position in going out into the market,'' said Watts, who was transportation secretary when the state approved the Greenway venture in 1988.
She stressed that the state would incur no liability because of her bill. ``We're not bailing them out,'' she said.
``The key thing is guaranteeing everyone out there that we're not talking about pledging the state's full faith and credit.''
But Transportation Secretary Robert E. Martinez said he fears that the bill could pressure the state to increase its involvement in the project.
``I know that I speak for the governor on this - we will not support any legislation that would increase by one penny the exposure of the state,'' he said.
Martinez said that while he supports the Greenway, its financial troubles are not the state's problem. ``I wish them all the luck in the world, seriously,'' he said. ``I hope they make a ton of money. But it's a private venture.''
The road's three main investors in Toll Road Investors Partnership II stand to lose a total of $82 million if missed debt payments result in a foreclosure.
The three partners are Middleburg resident Maggie Bryant; Autostrade International SpA, an Italian toll road company; and Brown & Root of Houston, the contractor that built the road.
Michael Crane, chief executive of the Greenway company, said the company has no immediate plans to request federal loan money.
``We are concentrating on increasing the ridership. That's our main focus right now,'' Crane said. ``This bill gives us more financing options, and I would always want to try to maintain as many options as possible. I don't think it will really impact our current financial situation.''
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