WASTING TAXPAYERS' MONEY

The proposed new Interstate I-69 highway has been nationally recognized as an extraordinary waste of our tax dollars.

Building a new highway from Indianapolis to Evansville would cost $1.7 billion or more. The common sense Interstate 70/ US 41 alternative route for I-69 would be only 13 miles longer than a new highway. Yet it would be $800 million cheaper. For details see chart below.

Is it really worth spending $800 million more of our hard-earned tax money to save 12 minutes on the two-and-a-half hour drive from Indianapolis to Evansville? Of course not:

• A national taxpayers' group named the proposed new I-69 one of the five most wasteful highway projects in the entire nation. Click here to view their report, Road to Ruin '99

• On NBC Nightly News, Tom Brokaw branded the highway a "Fleecing of America." Who's getting fleeced, like sheep? Taxpayers.

Getting the Most Bang for the Buck:

Cost/Benefit Analysis for the Proposed I-69 Highway

1990

The "Southwest Indiana Highway Feasibility Study" (a/k/a the "Donohue Study") was a congressionally funded cost/benefit analysis of four potential highway projects in Southwest Indiana, including a new Interstate between Indianapolis and Evansville. The study was conducted for the Indiana Department of Transportation (INDOT) and the Federal Highway Administration (FHWA).

The study concluded that "based on the results of the cost/benefit evaluation, construction was not recommended for any of the four alternatives...This suggests that there may be other projects both inside and outside Southwest Indiana that would represent better investments." (1)

INDOT conducted a cost/benefit analysis as part of its 1996 Draft Environmental Impact Statement on a proposed Interstate between Bloomington and Evansville. That analysis estimated that the cost/benefit ratio would be 1:1.54, meaning that for every dollar invested, $1.54 would be returned in benefits. (2)

In May 1997, Neal Johnson, PhD., an independent economist at Indiana University, studied INDOT’s cost/benefit analysis. His report was an impartial analysis, motivated by a concern that the benefits and costs of this major project be correctly and honestly calculated and presented to the public. Dr. Johnson was not been paid by either proponents or opponents of the highway, or by anyone else, for the preparation of the report.

Dr. Johnson concluded that INDOT’s new highway would be a bad investment for Indiana and the nation. After correcting several deficiencies in INDOT’s cost/benefit analysis, he determined that the costs of the proposed Bloomington to Evansville highway would exceed the benefits by $115 million. The report concluded that the cost/benefit ratio would be 1:.081; meaning that for every dollar invested, only 81 cents would be returned in benefits. Neither FHWA nor INDOT ever disputed Dr. Johnson’s conclusions. (3)

Click here to view a summary of Dr. Johnson’s study, "A Re-evaluation of the Benefits and Costs of the Proposed Southwest Indiana Highway.

In July 2002, INDOT released a Draft Environmental Impact Statement for a proposed extension of I-69 between Indianapolis and Evansville. In January 2003, Governor O’Bannon announced he was selecting a new-terrain route for I-69 via Bloomington. O’Bannon and INDOT rejected the least costly alternative for I-69, which is to use I-70 and an upgraded US 41 as the route.

INDOT has refused to conduct a cost/benefit analysis on O’Bannon’s preferred route. The previous poor performance of proposed highway projects between Indianapolis and Evansville may be one reason INDOT is refusing to perform such an analysis. A comparison of INDOT’s estimated costs and purported benefits of the new-terrain I-69 and the I-70/US 41 route, strongly suggests that O’Bannon’s new-terrain route would again fail a cost/benefit analysis and perform much worse than the I-70/US 41 option.

Conclusion

No proposal for an extension of I-69 through Southwest Indiana has ever passed an objective cost/benefit analysis. INDOT's refusal to conduct a cost/benefit analysis on Governor O'Bannon's preferred routes is telling. A review of INDOT's own cost and benefit data indicates that O'Bannon's new-terrain route would likely fail a cost/benefit analysis and would certainly perform worse than the I-70/US 41 route.

For more information, contact Andy Knott at Hoosier Environmental Council at 317.685.8800.

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