Editor’s Note: The ATFI is a coalition (of which the NMA is a member) which work tirelessly to maintain the longstanding policy of protecting existing interstates from new tolls. ATFI’s Charlie Kiefer has given the NMA permission to showcase the summer update.
Due to the current global pandemic caused by COVID-19, the tolling industry has suffered in recent months from major decreases in users and traffic, leading to a freefall of anticipated revenues. According to INRIX, a world-wide transportation data and analytics company, the noticeable travel decline began around ten weeks ago.
In fact, the week of April 9, 2020 showed the lowest weekly average for travel down 47 percent. Since then, the weekly average has been on a slow rise. With fewer cars on the road, some tolling agencies have even seen a 50 percent or more drop in revenue. Despite the revenue decrease tolling agencies around the country are experiencing, many are starting to see an increase in traffic on highways as people return to work but avoid public transportation, thus a faster-than-expected return in revenue.
Even though the tolling industry is surviving the current pandemic affecting our national economy, industry leaders are still requesting additional funding from Congress and continuing to look for ways to boost the industry by adding more tolling facilitates throughout. Federal subsidies for tolling authorities are an inappropriate use of taxpayer funds and could jeopardize the allocation of funds for state departments of transportation.
The Alliance for Toll-Free Interstates (ATFI) is devoted to keeping existing interstates toll-free and open as they were designed. ATFI strives to educate the public, policymakers and the media about the negative implications that tolling existing interstates has on American communities and businesses and why it will not solve our transportation needs. Below are the states we have been monitoring and engaged in throughout 2020, many of which have been impacted by COVID-19. We welcome your involvement to find substantial solutions for our country’s highway funding challenges that don’t consist of tolling existing interstates.
- Connecticut– Although Connecticut’s economy is reeling from the COVID-19 pandemic, legislators do not plan on hiking gas taxes or imposing tolls this summer. In the meantime, Connecticut will rely on borrowing money to finance infrastructure repairs. Governor Ned Lamont noted that the Special Transportation Fund (STF), which is the portion of the state budget that pays off borrowing for infrastructure repairs, will run out of cash in the fiscal year beginning July 2022. Earlier this year, Governor Lamont abandoned his highway tolls for trucks plan that he intended to enact this year. Due to ongoing discussions by members of the General Assembly, Governor Lamont chose to pause his plan rather than reschedule the vote.
- Michigan– Michigan only collects tolls on bridges like the Mackinac Bridge, the Blue Water Bridge and the International Bridge, at this time. Earlier this year, the state Senate voted to advance a bill which would create a panel to explore the practicality of charging tolls for roads, too. The legislation is known as Senate Bill 517 and was sponsored by Senator John Bizon. If passed, SB 517 would require Michigan officials to hire an independent consulting firm to study the viability of collecting tolls on interstates. Then, the consulting firm would create a written report with the firm’s findings within 18 months of the bill’s effective date. Once that is complete, the governor would be allowed to move forward with a tolling plan. Due to the global pandemic caused by COVID-19, Michigan’s Legislature adjourned for a few weeks and reconvened on April 7. The bill remains to be reviewed by the House Transportation Committee.
- North Carolina– The global pandemic has hit North Carolina’s transportation funding hard. Traffic volume has been recently down 30 to 50 percent throughout the state. The traffic decrease is projected to result in a loss of approximately $300 million in the fiscal year ending June 30, 2020. Multiple projects intended to widen Interstate 95 and upgrade sections of US-70 have been removed from the state’s year-long spending plan. Data has shown that it will take months to bring back the suspended projects.
- Rhode Island– After the state announced construction would begin on 10 truck-only toll facilities on Interstate 95 in December, the American Trucking Association filed a lawsuit. Despite the lawsuit, the first toll booths opened in June 2019. After numerous appeals, the ATA is moving forward with its lawsuit and will resume the fight in a lower court against tolls. In other news, due to the global pandemic, Rhode Island has opened two more open-road toll lanes on Newport Bridge. In March, the Rhode Island Bridge and Turnpike Authority closed the cash collection booths from 11 p.m. to 7 a.m. Those without an EZ pass were directed to the open road tolling lanes and would be mailed a bill passed on a photo of their vehicle’s license plate.
- Wyoming– Lawmakers in Wyoming considered tolling Interstate 80 lately across the entire state. The Wyoming legislature introduced a bill in December 2019 that failed in February that would have allowed the state to convert I-80 into a major toll road. The bill was backed by Senator Michael Von Flatern. Small business groups and trucking groups alike opposed the legislation. For a moment, a positive vote on the bill seemed likely, with various lawmakers from southern Wyoming supporting the bill. There were several reasons the bill was almost successful, one being that the Wyoming Department of Transportation has been facing shortfalls in funding. With the state facing over $100 million in annual unmet road needs, the head of the Wyoming Department of Transportation (WYDOT), Director Luke Reiner, offered his support in May for a per-mile road usage charge in tolls for all road users as a funding option. The Joint Transportation, Highways and Military Affairs Committee will have its next meeting on July 10, 2020.
- Federal – There is no denying that COVID-19 has had a negative impact on the tolling industry. Tolling agencies across the nation have seen their revenue drop significantly due to government shutdowns that began in early March. For that reason, many are looking to the federal government for short- and long-term aid. Officials from tolling agencies have requested modifications to the Transportation Infrastructure Finance and Innovation Act (TIFIA). The modifications requested by the tolling agencies seek to give the borrower a one-time amendment to reduce the interest rate on outstanding TIFIA loans. Along with the TIFIA requested modifications, in April, International Bridge, Tunnel and Turnpike Association (IBTTA) asked Congressional leaders for $9.24 billion in flexible funding to help the tolling industry. IBTTA Chief Executive Officer, Patrick Jones, said at a press briefing that out of the 342 toll facilities across the nation, COVID-19 has caused revenue and traffic to decrease by half, and in some jurisdictions, as much as 90 percent. However, tolling authority representatives have repeatedly assured bondholders in public statements that they have ample cash reserves and are able to make timely payments. ATFI has pushed Congressional leadership to deny this federal bailout, as the tolling industry acknowledges that it can weather the pandemic financially – and therefore does not deserve taxpayer dollars that other struggling businesses need to survive the COVID-19 crisis.
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The American Transportation Research Institute (ATRI) issued new research earlier this year that documents the collection and distribution of $14.7 billion in U.S. toll revenue, representing 81.7 percent of U.S. toll collections.
Did you know? Tolls are costly and complicated to run. Of the $14.7 billion in total toll revenue, $4.764 billion (32.4%) of total revenue was used for all facility costs. This includes all operating expenses, such as collection costs, administration, executive pay, patrol/safety/police, insurance, maintenance, preservation and construction. Tolls are an incredibly inefficient funding source. This data was taken from the January 2020 ATRI Report (A Financial Analysis of Toll System Revenue: Who Pays & Who Benefits).