EXCERPTS FROM NEWARK STAR-LEDGER:NJ Begins to Get a Clue Over Funds for E-ZPass

Do we detect just a trace of uncertainty? A certain hesitancy? A minuscule but discernible crack in the crucible of official conviction that $500 million worth of E-ZPass booths, lanes, cameras and processing systems can be put in place at no cost to the honest tollpayer? Has there been an admission, perhaps, that there really is an itty-bitty, teensy-weensy ghost of a chance that at the end of the E-ZPass experimental period, the bills cannot be paid exclusively by the 1% of drivers who are ne’er-do-wells. Motorists with natures so vile they will stoop to evading fair and reasonable tolls. Levies that the 99% of us, who are righteous drivers, willingly pay to ensure safe and speedy passage over the toll road of our choice. Edward Gross... took care to explain that among the things the bonds will buy is a $200 million Supplemental Capital Fund. This money is targeted for various pick-and- shovel projects, but in the event the toll cheaters don’t get caught in sufficient numbers to cover the E-ZPass nut, funds can be diverted so that no shortfall will occur on what the people in the public works game call “True-Up Day.”

Gross is a solemn sort and careful about his choice of words. So far as I know, he has never before raised the possibility that clearing $50m worth of fines at $25 a pop every year for eight years might be an order too tall for even The Consortium to fill... When it’s all up and running, the network will account for a billion E-ZPass transactions a year. According to the Consortium model, the violation rate ought to run at least 1% — or 10 million a year. The model predicts that the E-ZPass electronic cops will catch, ticket and collect from 25% of these toll beaters and presto, there’s the money needed to cover enforcement costs and make the interest payments in timely fashion until it’s time to break out the champagne on True-Up Day, 2009.

Could be done, I guess. Stranger things have come to pass. It’s just that I have a mind easily boggled and boggled it gets when I try to envision 80m drivers — roughly the population of Germany — blitzkrieging the E-ZPass lanes. Gross notes that 25,000 motorists avoid paying tolls on the Parkway every single day, and that’s enough right there to form an annual scofflaw pool big enough to generate the revenue to pay off the E-ZPass obligation. But the Parkway bandits are doing their thing at toll lanes that rely on bells and flashing lights to keep drivers honest. Their chances of getting caught are less than remote. But with E-ZPass, the odds on beating the system are much, much shorter. For local drivers, it would be no better than even money.

Thus, the Consortium is counting on drivers trying to beat a system they know is photographing their car and license number. And one, by the way, that presumably will be as eager to fine and collect as the good ol’ cops running an Alabama speed trap. The average driver isn’t going to run that kind of risk. Indeed drivers on the Atlantic City Expressway, which already has E-ZPass, have been dropping dollar bills in toll plaza baskets when they don’t have the exact change (50 cents) and find themselves in exact change lanes. Why? Because they’ve been spooked by recent crackdowns on toll beaters.

But Gross says he isn’t counting on the average driver. He sees toll beaters as recidivists who will time and time again defy the odds and the omniscient eye of the E-ZPass cameras.

With all due respect to the Consortium’s models, it seems a little far-fetched that millions of lemminglike drivers will repeatedly risk the agony of $25 fines for the thrill of beating the toll system for a couple of bucks. Seems to me it may be necessary to dip deeply into the old Supplemental Capital Fund to square accounts on True-Up Day. Must seem that way to somebody of influence in the Consortium, too. Why else designate the Supplemental Capital Fund, as Gross put it, “our security blanket.” It would be unfair to say that Gross is beginning to acknowledge that the E-ZPass financing scheme was, as has been alleged here from time to time, preposterous. Let us rather, in the spirit of the season, say that on Thursday last, certain of us at this newspaper were privileged to bear witness to another kind of Truing-Up. (By Courtesy. 12/9/99)