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The Great Debate on Tolls & PPPs

The Great Debate on Tolls & PPPs. “CON” Position By Greg Cohen American Highway Users Alliance ADC Conference – Denver September 19, 2014. Background. The HwyUsers Alliance is proud to be a sponsoring organization of ADC Great issue for this group! Not a partisan issue

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The Great Debate on Tolls & PPPs

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  1. The Great Debate on Tolls & PPPs “CON” Position By Greg Cohen American Highway Users Alliance ADC Conference – Denver September 19, 2014

  2. Background • The HwyUsers Alliance is proud to be a sponsoring organization of ADC • Great issue for this group! • Not a partisan issue • Quick points of philosophical agreement: • We both support more freedom of mobility • We both oppose waste and bureaucratic excess

  3. Limit Tolling • While some tolling and PPPs can add value to users, there are many temptation to fleece us • By limiting the types of tolling projects there is a better chance of good outcomes: • Building new roads (more quickly too) • Adding tolled express lanes • Converting underutilized HOV lanes to HOT lanes • Even in these cases, road users must be protected! • No non-compete agreements or similar arrangements.

  4. Differences of Opinion • Oppose the conversion of existing free lanes • Oppose “long-term” leases for lump upfront cash (both public and private) • On diversion: Don’t trust toll operators more than tax collectors • Tolls are more regressive than fuel taxes • Safety impacts from diverted truck traffic are a cost • Enviro. groups like EDF love pricing as a means to do social engineering & oppose physical capacity • Oppose “balkanization” of the States

  5. A little history • 98 years ago: Fed. Aid Hwy Act of 1916 creates Fed-State partnership to fund the national connected highway network. Tolls banned if federal funds used. • 1927 – Relaxed ban on bridges but tolls had to be lifted once bridge bonds are paid. • 1956 – Grandfathered toll roads onto Interstate System routes • 1987 – Program to permit tolls on non-Interstate routes receving fed-aid.

  6. Recent history • 1998 – Pilot program for up to three Interstate routes to convert to tolls (no diversion / last resort for funding) • 2012 – MAP21 permits unlimited tolling of new capacity only. • 2014 – Obama Administration proposes allowing tolls anywhere on the Interstates, and permiting diversion of the tolls to transit

  7. Highway Robbery • Yesterday, The HwyUsers entered an Amicus Brief in support of the users of the Dulles Toll Road • Cato & the Recreation Vehicle Industry Association joined the brief • A long-term concession agreement between VDOT & MWAA left toll road users with a 466% increase in tolls since 2005. • The tolls were continually raised to pay for rail to the airport. Road users have no ability outside the courts to effectively fight the toll increases.

  8. Diversion of tolls is not confined to this isolated case • PANY&NJ divert tolls for PATH trains and the WTC • Since Robert Moses left, the Triborough Bridge and Tunnel Authority under MTA diverts its revenue to the New York Subway • A few miles of I-95 in Delaware pays for much of the State government on the backs of motorists.

  9. Under Obama’s Plan “Bad” toll projects just as likely to be the norm as “Good” toll projects • Examining recent tolling attempts on the I.H.S. • I-80 in Pennsylvania • I-95 in North Carolina & Virginia • I-90 in Washington State • NJ 440 into Staten Island (combined with concession agreement on GS Pkwy & NJ Tpke)

  10. Why it’s so Easy for Good Toll Ideas to Go Bad: • Crony capitalism: • Monopolies, whether public or private, are NOT market based. • Public officials who are weak & afraid • Don’t tax me, tax the guy behind the tree! • Windfall revenues from long-term leases • Less opportunity for taxpayers to question rates, particularly under a concession. • Some toll authorities keep their books closed to the public and their mischief can’t be uncovered. • Tolls can be used for social engineering. • Tolls harm a captive population of road users.

  11. Conclusions • No system is perfect • Taxes are diverted. • Tolls are diverted too. • The Obama plan to allow tolling of any or all Interstates creates dangers for motorists. • Federal program must be reformed to restore the trust in the Highway Trust Fund and taxes must be adjusted to deal with needs, inflation, and increased fuel economy. • In the limited cases where toll and PPP plans add more value to motorists, Congress must still maintain its constitutional duty to regulate interstate commerce and taxpayers must still have means to address grievances.

  12. THANK YOU • Contact Greg Cohen @ gregcohen@highways.org

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