New Jersey Turnpike toll increases trimmed slightly, new discounts for greenies, oldies, trucks off-peak

Toll increases on the New Jersey Turnpike are being trimmed slightly in response to criticism, according to Turnpike officials but they will still be substantial under revised proposals released today. Car tolls on the New Jersey Turnpike will be increased on an average trip from $1.20 to $1.70 (+50c) rather than to $1.80 (+60c) as announced September 4. Truck tolls also will be increased slightly less on the Turnpike than proposed a month ago.

The trim down of the toll increases  is said to be in response to current economic conditions as well as to public comment. The letter says the Turnpike was directed by the Governor to "lessen the burden on New Jersey families by lowering the Authority's recently proposed toll plan."

There is no change in the proposed toll increases on the Garden State Parkway where tolls will rise from 35c to 50c later this year and 25c to 75c in 2012.

Under the plan announced today in a letter from Kris Kolluri, state secretary of transportation under his title as chairman of the New Jersey Turnpike Authority tolls will increase around 42% later this year - in the Sept 4 proposal this was scheduled for 2009, month unspecified. Also there will be an increase of just over 50% in 2012 for a total increase of around 115% (meaning tolls will be 2.15 x the present level.) Tolls on the Garden State Parkway are presently among the lowest in the US at 2.2c/mile and are about or below average on the New Jersey Turnpike at 5.3c/mile for cars.

By 2012 tolls on the GSP would be 4.7c/mile and on the Turnpike 11.5c/mile by our estimates.

The percentage increases now seem larger than in September because Kolluri uses lower base tolls in his letter to the Governor. The state treasury commissioned Steer Davies Gleave to do the traffic and revenue work for the toll increases but nothing of this has been released.

Close to doubling of revenues by 2012 to $1.4b+

If traffic is about 10% lower due to the toll increases and a static regional trend then toll revenues should increase about  94% from the present $746m to around $1,447m in the first full year after the 2012 increases. That's jour estimate in the absence of any official explanation.

Letter drops reference to 2023 toll commitment

The slightly revised proposal in Kolluri's letter omits the reference in the letter of Sept 4  to a third round of toll increases in 2023, which no present officials can make commitments about. (It is even questionable whether officials in 2008 can make credible toll rate commitments for 2012, by which time there will likely be a different economic and budgetary environment and a substantially different Turnpike board and elected officials. Editor)

Political spin: the Authority will "lessen the burden on drivers by maintaining existing off-peak passenger car discounts for E-ZPass users". There was nothing in the Sept 4 proposal about reducing or eliminating those discounts which are 25% on the Turnpike, nothing on the Parkway.

New will be toll discounts for:

- senior citizens  (including aliens apparently) defined as drivers over 65 to get 10% off their E-ZPass toll bills for off-peak travel

- fuel efficient cars >45mpg or California super ultra low emission vehicles (SULEV) will get an additional 10% Green-Pass discount for off-peak travel

- trucks will get a 5% discount on off-peak E-ZPass travel on the Turnpike and the Parkway

Cost of the new discount program is put at $12.8m.

Economies

Kolluri says in his letter that 403 fulltime positions have been eliminated at a total saving of $87m since the merger of the Parkway and the Turnpike in 2003.

30 more positions will be eliminated immediately to save $1.9m/yr and 50 eliminated in each of the next four years through attrition to save $2.7m/yr.

Overtime is to be reduced by 10% in each of the next four years to save $765k/yr.

Capital plan

The revised proposal supports borrowing for $7b for capital works on the Turnpike roadways over ten years, a reduction from the $9.7b in the Sept 4 plan.

Major items out of 34 listed in an appendix to the letter are;

- widening of the existing 3+3 lanes to a 3/3/3/3 format over 40km (25 miles) between Interchanges 8A and 6, lane additions IC8A to IC9, plus interchange upgrades, cost $2,500m

- IC14A reconstruction in Bayoone, cost $500m

- widening the Parkway with third lanes IC63 to IC80, cost $200m

Rail transit tunnel

$1.25b in addition goes for the new rail transit tunnel to Penn Sation New York. This rail tunnel is said to preclude the need for $3.5b of widening of the Western Spur of the Turnpike.

Kolluri concludes: "The Turnpike Authority has a fiduciary obligation to act affirmatively to meet its debt service obligations and fund critical safety and congestion relief projects.  I believe these recommendations satisfy your mandate to reduce the proposed toll increase by proposing to cut the Authority’s operating budget and scale back its proposed capital plan.  I hope that you agree that this revised proposal achieves your objectives by meeting the Authority’s essential transportation needs at the least possible cost to the public."


TOLLROADSnews report on #1 proposal  Sept 4:

http://www.tollroadsnews.com/node/3727

Letter containing #2 proposal Oct 7:

http://www.state.nj.us/turnpike/Govlettercap.pdf

TOLLROADSnews 2008-10-07