A consortium looking to lease the Pennsylvania Turnpike for $12.8 billion has withdrawn its bid after state legislators failed to act on the proposal. The move comes as concerns mount within the transportation sector about the tightening credit markets.

Pennsylvania Transportation Partners, which is led by New York City-based Citigroup and Spanish firm Abertis Infraestructuras, allowed the deal to expire on Sept. 30. The group was selected as the preferred bidder to lease the turnpike in May.

The 75-year lease offer was endorsed by Gov. Edward Rendell (D) as a fix for the state’s looming transportation funding issues. However, it was met with heavy opposition from within the state legislature as well as the Pennsylvania Turnpike Commission. After several deadline extensions from PTP, the General Assembly did not take the proposal to a floor vote before it expired at the end of September.

PTP Senior Advisor Jim Courtovich said he had hoped the turnpike lease could serve as a model for large-scale public-private partnerships across the country, addressing the state’s immediate needs for infrastructure investment and offering best-practices ideas for the turnpike’s management.

"It is for these reasons that we have been willing to extend our bid twice beyond the original June 20 deadline for legislative action, notwithstanding a decline in traffic, a deteriorating economic environment and the most difficult financial markets in nearly 80 years," he said.

Gov. Rendell said he remains committed to pursuing legislation to allow a lease of the turnpike.

"Should such legislation be enacted, it would be my hope to execute a lease with the Abertis/Citi team," he said in a statement.

The Pennsylvania proposal is the second major transportation initiative to fall apart within the past two weeks. The Missouri Dept. of Transportation announced on Sept. 18 that it would discontinue talks with Missouri Bridge Partners, an industry venture headed by San Antonio-based Zachry American Infrastructure, to fast-track a major bridge- rebuilding program because of tighter credit and added cost. The state is opting instead to fund the bridge project by issuing $700 million of state bonds.