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Reason & Rail blog
June 30, 2011
In comparison to my earlier post about the operational profits of high speed rail, I thought it might be useful to take a gander at various toll roads in America and see whether they made a net profit; that is, revenues in excess of operational, depreciation, tax, and interest expenses; since the major complaint I've run into is persons complaining that high speed rail ought to repay its capital investment costs as well. I'm specifically breaking out interest in order to help illustrate the capital costs, but annual net deficits or profits are based on the totality of revenues and expenses as reported by the toll road.
San Joaquin Toll Road (CA SR 73), 2010, page 9
Operating income: $81,668,000
Interest expense: $112,817,000
Annual net deficit: $19,690,000
SR 73 is in sufficiently poor shape that it recently found it necessary to reduce the debt service margin and extend the bond repayment period in order to continue paying them.
Foothill/Eastern Toll Roads (CA SR 241, 261, 133), 2010, page 9
Operating income: $94,669,000
Interest expense: $132,418,000
Annual net deficit: $10,702,000
E-470 (Denver, Colorado), 2010, page 14
Operating income: $31,366,289
Interest expense: $95,419,612
Annual net deficit: $60,068,817
In addition to toll revenue (from some of the highest in the country, with a full length trip from I-25 S to I-25 N costing 31.8¢ per mile), E-470 also received more than 8.6 million dollars in vehicle registration fees.
Harris County Toll Road Authority, 2010, page 16
Operating income: $229,583,106
Interest expense: $116,887,849
Annual net income: $132,199,306
North Texas Tollway Authority, 2010, page 12
Operating income: $258,200,000
Interest expense: $377,500,000
Annual net deficit: $111,200,000
Note that the numbers here may be deceptive. According to Tollroad News, "one reason NTTA was able to build the TX121 Sam Rayburn Tollway so cheaply was that they took over a half-built pike from TxDOT and excluded TxDOT's costs from their figure for Project Costs." There may, therefore, be additional depreciation and interest costs not properly accounted for.
Central Texas Turnpike System, 2010, page 21
Operating income: $5,688,946
Interest and amortization: $66,745,615
Annual net deficit: $127,139,586
In this case, I ignored 63 million dollars in outside capital contributions and transfer payments in recording the net deficit. This does not materially affect the matter as it only offset half the losses. It is also interesting to note that in 2009, after depreciation, the CTTS ran a negative operational income, a result not seen in any of the earlier examined figures regarding high speed rail.
Pennsylvania Turnpike, 2010, page 24
Operating income: $71,359,000
Interest expense: $263,749,000
Annual net deficit $162,295,000
In 2009, the PA Turnpike had a negative operational income. The annual net deficit figure I've used is after eliminating transfers to PennDOT and likewise ignoring capital contributions. It is quite possible, however, that the PA Turnpike would run a net profit were it not for the revenue bonds funding transfers to PennDOT under Act 44.
Indiana Toll Road Concession Company, 2010
EBITDA: $138,800,00
Operating income: $59,100,000
Interest expense: $268,000,000
Net annual deficit: $260,800,000
Ohio Turnpike Commission, 2009, page 23
Total revenues: $209,348,000 (includes 2.1 million in gas tax allocations)
Total expenses: $199,701,000
Interest expense: $30,730,000
Net annual profit: $9,647,000
Much of the revenue for the Ohio Turnpike comes from commercial vehicles which represent 20% of the traffic and 53% of its revenue collection. As a result, increased intermodal competition from railroads, such as the new CSX intermodal yard, may represent a major threat to the sustained profitability of the Ohio Turnpike.