AASHTO opposes federal power grab on tolls

In testimony this week on Capitol Hill the states' highway lobby AASHTO (Association of American State Highway and Transportation Officials)  argued against Senator Frank Lautenburg's so-called Commuter Protection Act, S2006. Speaking for AASHTO North Carolina DOT head Eugene A Conti said enactment of the bill would add great uncertainty to financing of toll projects and discourage states and local authorities from advancing projects that would have to gain federal clearance for toll rates.

"(T)he loss of tolling agencies’ ability to set their own rates would have a deeply unfavorable effect on their credit ratings, increasing the cost of capital and making it harder for such agencies to borrow money through issuances of bonds for much needed capital improvements, maintenance and other essential services."

In addition S2006 would discourage use of toll-financed public-private partnerships (PPPs):

"Instead of granting maximum access and flexibility to a mix of funding and financing tools most appropriate for each state including toll-based PPPs, Congress would create new impediments to private investment through this legislation."

Conti said the states agree that "federal limitations should be removed" that hamper use of tolls for reconstruction within the tolled corridor. At present only three states of 50 are able to use tolls in this way under the very limited "pilot program" outside of bridges and tunnels.

The AASHTO submission says the traditional highway trust fund financing is "at a crossroads" with flat or declining revenues and increasing difficulties obtaining other funding. The deficit relative to existing inadequate federal grants of $90b/year is put at $13b/year by the Congressional Budget Office.  National Surface Transportation Policy and Revenue Study Commission had projected future federal investment needs at $225b/year, almost three times the yield of current gas tax revenues.

Conti: "In recent years, with the growing gap between highway investment needs and available revenues as well as the development of easy-to-use automated toll collection technology, toll roads and toll lanes have once again become an important means for financing investment in new highway capacity—in the last decade about one-third of all new limited-access lane miles built in the United States were tolled; in states such as Texas and Florida, the share is even higher."

The AASHTO submission said currently, there are more than 270 state and local toll roads, bridges, and tunnels in 32 states, totaling 5,541 miles of roadway.

Toll revenues nationally are around $11b/year.