The Chicago Skyway is changing hands — for the second time in seven years — generating another transaction tax windfall for Chicago taxpayers.
The Chicago Skyway is changing hands — for the second time in seven years — generating another transaction tax windfall forCanadian pension plans that control the Skyway were looking to sell their one-third stakes for a handsome profit that valued the overall roadway at $4 billion, courtesy of drivers forking over tolls that have risen steadily since the city leased it to private operators in 2005.
The firms and the Ontario Teachers’ Pension Plan bought the lease in 2015 for $2.8 billion, $1 billion more than Chicago taxpayers got for the 99-year lease in 2004. The teachers’ pension plan plans to keep its one-third stake in the Skyway. Former Mayor Richard M. Daley directed the original sale of the 99-year lease in what came to be known around City Hall as the Great Chicago sell-off.
"What are the implications for the value of the Skyway when it comes back to the city in 2104? Based on the equity value of $3 billion, it’s gonna be north of $15 billion in value," Levenson said.Levenson pointed to what he called the "multiple of earnings" being paid on the most recent sale. It’s "30 times earnings," compared to "an unheard of 50 times earnings" when Chicago unloaded the Skyway.
Results of the latest audits were provided to the Chicago Sun-Times by attorney Clint Krislov. As director of IIT Chicago-Kent’s Center for Open Government, Krislov has reviewed dozens of transactions to date and provides an annual analysis of each year’s results."The idea that we’ll get it back in 2104 is like saying that the [native Americans] are gonna get Manhattan back in the year 2500," Krislov said.
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