Posts Tagged ‘Delaware’

HMSHost’s Contract With Delaware is Bad for Businesses and Consumers

Monday, June 28th, 2010

On Monday, June 28, the Delaware Department of Transportation reopened the Delaware Welcome Center Travel Plaza after a 9 month, $35 million renovation.  Food service vendor HMSHost will manage the state-sponsored facility for the next 35 years.  The facility is one of a handful of rest areas across the country permitted to offer commercial services under existing federal law. But its opening sends the wrong message to those states looking to overturn the ban on adding commercial services at rest areas as a means of fixing state budgetary woes.

Lisa Mullings, President and CEO of NATSO issued the following statement Monday morning regarding the reopening of the travel plaza:

“In discussing its 35-year contract with HMSHost Corp. to operate the Delaware Welcome & Travel Center, the state of Delaware has grossly exaggerated the benefits of this agreement and failed to inform local residents, businesses and consumers about the deal’s significant downside.

Contrary to claims that the facility will serve as an economic tool generating jobs and state revenue, the Delaware Travel Center represents nothing more than a monopoly that threatens to cripple the many businesses offering food, fuel and other retail services near the I-95 exit interchanges.

With direct access to highway motorists, the state now operates at a significant advantage over the businesses that depend on motorists exiting the Interstate. The 4.5 million visitors HMSHost claims it will service are 10 times what many local businesses would see in terms of visitors. This deal represents a classic example of government teaming up with big business to squeeze out small business.

While nearby businesses are left to flounder, consumers undoubtedly will pay hidden taxes in the form of higher costs for goods and services as the state seeks to recoup its investment.

Furthermore, the state of Delaware has said that beginning today it will balance its budget without regard for the needs of local communities. Local businesses typically pay more in local taxes than it will cost HMSHost to maintain the Travel Center. Without thriving businesses, local communities will lose jobs and the significant tax revenues that pay for public services like schools, police and fire departments.

Delaware’s so-called ‘best investment’ in reality rings the death knell for local communities.”