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The Indiana Toll Road Lease as an Intergenerational Cash Transfer


  • John B. Gilmour is Paul Verkuil, Professor at the College of William and Mary, where he has taught in the Government Department and the Thomas, Jefferson Program in Public Policy since 1995. His fi eld of research and teaching is American politics, with specialization on Congress and the president and on budgetary politics and processes. He is author of two books and numerous articles. E-mail:


In a recent incarnation of the public–private partnership, state or city governments agree to lease revenue-producing assets to a private operator for a lengthy period, up to 99 years. The government receives an up-front payment, allowing it to collect many years of future revenue at once. This article evaluates the distributional consequences across time of one asset lease, the Indiana Toll Road. The analysis finds that the majority of benefits, in the form of road construction, are enjoyed in the early part of the lease, while the bulk of the costs fall late in the lease, raising important questions about intergenerational fairness.