Privatizing Transportation Systems

Privatizing Transportation Systems

Privatizing Transportation Systems

Privatizing Transportation Systems


Privatization began in the 1970s with Carter's deregulation of some business, and increased with the Thatcher administration in the United Kindgom, the Reagan administration in the United States, and many communist and socialist countries. One area of concern in privatization is transportation--airports, water ports, roads, and mass transit. Privatization can be implemented in financing, construction, operation, and maintenance of the transportation system, the main motives being the belief that the private sector can be more efficient than the public sector, and because public funds are becoming less plentiful for a variety of reasons. These original essays, contributed by a distingushed group that includes the 1996 Nobel Prize in Economics co-recipient William Vickrey, focus on ideas and innovations for expanding the private role in transportation.


Jack M. Reilly

In 1989, the Albany County Executive proposed a long-term lease of the Albany County Airport to a joint venture between Lockheed Air Terminal, Inc. and a local developer. This was the first time that a local elected official seriously pursued conversion from public to private governance of an airport used by commercial air carriers.

The controversial proposal, which was never implemented, received considerable local and national attention and was discussed by numerous airport constituencies. This chapter highlights the chronology of events surrounding the proposed lease and the motivations for it. the local issues raised by private governance of the airport are discussed, as are reactions of airport constituents and opinion makers, such as the local and national press. the set of constituencies includes airlines, the federal government, airport users, airport neighbors, and the local business community.

In his State of the County address on January 1, 1988, Albany County Executive James Coyne proposed the sale of the Albany County Airport to the Capital District Transportation Authority (CDTA), a regional transportation agency with legislative powers to operate transportation services and facilities in the Albany area. CDTA's primary responsibility was the region's public transit system. in proposing the transfer, the County Executive stated, "The changeover could go a long way in assisting us in cutting future taxes and at the same time take on a regional concept in aviation." After several months of negotiation with cdta, which revolved primarily around the acquisition . . .

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