91X:CPTC reports slight downturn in ‘99

California Private Transp Co’s audited financial results for 1999 show the 91 Express Lanes (91X) suffered a substantial 21% drop in traffic as compared to 1998 but managed to earn substantially higher toll rates, so that toll revenue only dropped 3%. 91X faced strong competition from the opening late 1998 of the Eastern Toll Road (CA-241) which siphoned off quite a block of Riverside county traffic headed for southern Orange Co that otherwise traveled 91X and the free lanes of CA-91, then CA-55.

Expenses were up moderately in 1999 by some $400k, reflecting money squandered on the ill-advised scheme to turn the business over to a non-profit, which set off a political firestorm, saw a huge bond issue cancelled, and resulted in the firing by the governor of the state secretary of transp.

The financial results suggest however that as a business, the 91X lanes is solid and resilient. Management’s predictions that the operation would quite quickly recover from the loss of traffic to the Eastern Toll Road seem to be accurate.

The report claims there will be a “significant increases in operating income in the coming years” and that “The 91 Express Lanes is on track to become an extremely profitable enterprise...”

The report says 91X customers increased by 8% during the year to 124k and usage of the toll express facility by customers of other toll facilities such as the TCA and I-15 rose to 12% of the total. Trips were an average 24k/weekday and 20k/day overall and the facility carried about a quarter of the peak hour load on the CA-91.

In 1999 CPTC doubled the size of their customer service center, added a tow truck, conducted many surveys of customer opinion, improved toll zone signage, installed a new violations system and upgraded computer systems. They also got lots of visits from people and groups around the states and the world, and got awards for their innovation.

91X is 16km (10mi) of 2x2-lane roadway in the center of the 8-lane CA-91 Riverside Freeway, a 250k veh/day highway which follows the canyon of the Santa Ana river through the mountain range dividing heavily residential Riverside county (co) from heavily employment Orange co and Los Angeles co.

The facility requires all users to establish an account and fit a toll transponder to their windshield. It has a toll schedule which has different toll rates for different hours, day by day. The toll varies between 75c and $3.75. There are discounts for frequent users. Carpoolers with 3 or more passengers get half toll. 91X mainly sells the assurance of a free flow ride through at 70mph, and a time saving of 10mins to 15mins in rush hours.

When there are signs of congestion developing CPTC issues a new toll rate schedule tailored to raise toll rates so as to choke off or move demand a little out of the peak. Out of rush hours 91X sells a quiet smooth asphalt ride, a welcome contrast to the rough concrete ride in the free lanes. It also sells a truck-free environment, and the reassurance of motorist assistance patrols.

CPTC’s principal owner is Level 3 Communications, an internet cabling concern that was spun off from Peter Kiewit & Sons, one of America’s largest highway builders. It made an unbelievably inept, and unnecessary, effort to exploit the tax laws and a state infrastructure bank to sell itself off to a not-for-profit that it established last year, which not only failed to be consummated but created considerable political hostility. But fortunately it is a strong financial entity and can outlast the political demagogues who want to end its toll concession. Level 3 has said it still intends to sell but is in no hurry and will wait for a solid price. Other important partners are Cofiroute the large French toll operator and Granite Construction.

The group put about $130m into the construction of the facility, which opened Dec 27 1995. It has an enthusiastic and loyal clientele, and many occasional users who mostly use the free lanes, but value the option to pay the toll when a quick trip is important. The facility broke even on a cash basis in its third year. (Contact Greg Hulsizer CPTC 714 637 9191 www.91expresslanes.com)