Penn Pike plans for I-80 tolls - 9 zones, only toll second E-ZPass

The Pennsylvania Turnpike Commission is looking to levy a toll in nine zones along I-80 and to provide a first free toll pass to car drivers equipped with a transponder. Within each of the nine zones (see yellow stretches on 2-part map at bottom) the Commission is now comparing two to four alternative points in order to select one point in each zone for a total of nine toll points along the 501km (311 miles) of the highway between the Ohio and New Jersey borders. The state legislature last summer enacted legislation (Act 44) allowing the Turnpike Commission to toll up to ten points along the interstate.

The Commission says the intention to toll longdistance and regional traffic can be met with just the nine toll points.

There are 59 interchanges and therefore 58 travel legs, so with tolls on only 9 legs 49 will be free. The Turnpike Commission says that one third of daily passenger car trips will not pay a toll. They have provided no estimate for trucks.

UPDATE: The Commission has revised this statement which was apparently a mistake in wording, and now says "more than 70%" of cars traveling I-80 will NOT pay a toll. 2008-08-07)

see http://www.tollroadsnews.com/node/3665

The Turnpike Commission proposes that cars and other 2-axle vehicles with an E-ZPass group toll transponder will only be charged a toll on the second toll point passed.

At the first toll point the transponder will apparently be written back to, so it carries a first free toll credit. That message held in memory will allow the second and subsequent tolls to be debited to the account.

Cars without transponders and trucks with or without transponders will be tolled at all nine toll points.

Tolling will be all-electronic so that vehicles without transponders will be video or image tolled - by camera. Being cashless there will be no toll booths or toll plazas on the highway and all toll transactions will occur automatically at normal highway speeds.

Toll rates, the PTC says, will be about 5c/km (8c/mile) for cars and 18c/km (30c/mile) for trucks. A car traveling the full length of I-80 will pay about $25 and a truck $100 - rates approximately matching those on the mainline of the Turnpike in 2010.

Tolling of I-80 is subject to federal approval.

http://www.paturnpike.com/I80/tolling/locations.aspx

Commonwealth Foundation says go to the private sector

The Commonwealth Foundation, a consistent critic of the PTC today reiterated their call for competitive bidding of the tolling of the interstate highway.

"We don’t believe it is necessary to toll I-80," said Matthew Brouillette, president of the Commonwealth Foundation.

"But if policymakers are determined to do so—and Pennsylvania receives federal permission—we should go to the marketplace and see what the private sector will bring to the table."

"The last thing we should do is merely hand over the tolling of I-80 to the Turnpike Commission. Not only is it bad public policy not to seek competitive bids on such a major transportation project, but it will likely cost taxpayers billions of dollars.”

An analysis conducted by the Commonwealth Foundation, found that if the federal government rejects the request to toll I-80 — and the state fails to lease the Turnpike for $12.8 billion — the state will lose $37.4 billion over the next 50 years.

Similar losses to taxpayers will likely be incurred if the Turnpike Commission is given control of I-80 without a competitive bidding process.

See table nearby.

The following are calculations prepared by the Commonwealth Foundation on the comparative values of a Turnpike lease and Act 44 (with I-80 tolling) over the first 50 years.

(1) The Commonwealth Foundation projects that interest on the Turnpike lease payment would yield $50.151 billion over the next fifty years. Calculations include:

a. An estimated 7.5% rate of return (below Gov. Rendell’s projected 12% rate of return).

b. A corpus of $10.5 billion: the $12.8 billion lease payment less $2.3 billion to retire Turnpike debt and pay other costs related to the lease.

c. A 2.5% annual increase in the amount drawn down by the state.

d. Annual payments that would exhaust the corpus only at the end of the 75-year lease.

(2) The $2.3 billion used to pay Turnpike Commission debt and other expenses was then added to the value of the lease deal.

(3) The Turnpike Commission currently reimburses the state $33 million annually for the cost of state police on the Turnpike. Over 50 years, assuming 2.5% annual increases, this cost results in $3.2 billion, which was deducted from the value of the Turnpike lease.

(4) The Turnpike Commission currently receives $87 million annually in subsidies from the state Motor License Fund and Oil Company Franchise Tax. This subsidy is not included in the Turnpike Lease, and represents a 50-year savings for the state (assuming 2.5% annual increases) of $8.5 billion, which was added to the value of the lease.

(5) The Lessee (Pennsylvania Transportation Partners) would pay the state Corporate Net Income Tax. Based on an estimate of $3.3 to $4.2 billion over the 75-year lease, the Commonwealth Foundation projects the 50-year value of this tax would be $2.2 billion, which was added to the value of the lease.

(6) Under Act 44, the Turnpike Commission will pay $450 million annually to the state if I-80 is not tolled (for whatever reason). The fifty-year value of this payment is $22.5 billion.

For comparison on a present value basis, the lease would provide $21.6 billion in value to improve Pennsylvania’s infrastructure and transportation (i.e., $12.8 billion in upfront cash, $5.5 billion in committed capital requirements and $3.3 billion in new taxes paid). Without the tolling of I-80, Act 44 is a “promise to pay” $450 million over the next 50 years, which we have calculated as $5.2 billion in present value, which is $16.4 billion less than the lease in present value.

Penn Partners hit Turnpike

Pennsylvania Transportation Partners, the Abertis-Citi consortium that is the preferred lessee in a 75 year toll concession of the Turnpike Mainline (I-276/76/70) hit out strongly at the Turnpike Commission in a statement today. Jim Courtovich a spokesman said the Turnpike Commission is "addicted to deception" so Pennsylvanians should be suspicious of their promises.

"The PTC’s latest estimates are highly speculative."

Courtovich knocked the PTC for failing to release the data on which their I-80 toll estimates are based.

"There has been no peer review of their traffic assumptions and no analysis other than by those who the Turnpike Commission is paying. It’s no wonder after pushing this proposal for years a recent survey found only 29 percent of Pennsylvanians support the tolling of I-80. It’s a bad deal that keeps getting worse."

The concessionaires' spokesman said the Turnpike Commission keeps acting as though tolling I-80 is a done deal although it is far from certain to gain the needed US Government permit. Without I-80 toll revenues the Turnpike's contribution to state revenues will drop to produce what he called "a staggering shortfall for fixing Pennsylvania's crumbling infrastructure."

Courtovich did support the PTC's proposed discounts for frequent users, saying Abertis does this on their tollroads.

TOLLROADSnews 2008-08-06

UPDATE: 2008-08-07 2350 see report http://www.tollroadsnews.com/node/3665