Skyway Transaction

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Skyway Transaction

• Basic Considerations

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Why Privatize The Skyway?
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1. Not a core city competency somebody else
could do it better
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2. Eliminate the risks of Skyway ownership past
history of problems and default
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3. Ability to shift city capital no longer
needed in Skyway, better used elsewhere
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Could Privatization Be Done Legally?
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1. Basic Authority

1. City as home rule unit had power to sell or
   lease Skyway
2. City Council still had to approve timing get
   authority upfront or wait until the end?

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2. State Law Issues

1. No significant liability impact of shift to
   private operator
2. Real estate taxes triggered by sale or lease
   required amendment of Illinois statute

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3. Federal Law Issues

1. No federal funding for Skyway
2. 1961 FHWA Agreement resulting from connector
   funding required revised agreement with FHWA

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4. Contractual Issues

1. Construction and other Skyway contracts all
   assignable
2. All Skyway bonds had to be redeemed or defeased
   tax requirement even if ok under indentures