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Follow TURFThe Texas Transportation Commission just authorized a $55 million bailout of the Loop 49 toll project, but you sure wouldn't know it by this so-called news article. More like a puff piece to prop-up a loser toll road. If you carefully read between the lines, they claim traffic is up, and so are revenues, but both are still insufficient to cover the debt payments, so that's not exactly being honest with the public about the tollway's financial health. The reason for the Commission bailout is so that the RMA can look credit-worthy to issue it's next round of toll bonds to extend the failing toll road even further.
Shortcuts: Usage of Toll 49 is up; revenue rises as rates increase
Saturday, 9 August 2014
Written by Adam Russell
Tyler Morning Telegraph
Jimmy Boyd uses Toll 49 every workday. He hops on at Farm-to-Market Road 2493 and makes the 9-mile connection to Texas Highway 31 as he commutes from Gresham to Athens.
Boyd had his doubts that anyone would use the toll road when it was under construction. He believed drivers would continue using other routes to avoid paying tolls.
But then Boyd began using Toll 49. He used it when he was running late or in a hurry at first. Then he noted the time he saved.
Boyd cut 20 minutes off his round-trip commute, which had required him to go up Old Jacksonville Highway to Loop 323 and over to Texas Highway 31. It cut an hour off round-trip visits to Children’s Medical Center in Dallas when his son was undergoing cancer treatment, he said.
Despite a rate increase in April, which bumped the per mile rate from a base rate of 10 cents to 13.5 cents, Boyd said the benefit outweighs the cost.
“The time benefit outweighs the cost,” he said.
Boyd’s typical $60 monthly bill had been recently cut in half when he opted for a toll tag rather than paying bills by mail, which means paying higher rates and a processing fee.
But another rate increase is planned for Jan. 1, 2015, according to the North East Texas Regional Mobility Authority.
The rate increases are part of an agreement made with the Texas Department of Transportation before the mobility authority took management control of Toll 49. It required per-mile base rates be increased to 15 cents from 12 cents to meet an “Understanding Regarding Market Valuation For Toll 49.”
Regional Mobility Interim Director Everett Owen said rates would continue to increase 3 percent to 4 percent annually.
Toll 49 is a 25.4-mile, two-lane, outer loop around the south and west side of Tyler, connecting Texas Highway 110 near Whitehouse to Interstate 20. The road has seven toll stations that charge drivers with toll tags between 30 cents and $1.18 (the same stations charge drivers without toll tags 40 cents and $1.57, respectively) for passage.
Driving from I-20 to Texas Highway 110 would cost the driver of a passenger car $3.33 with a toll tag and $7.01, including a $1 processing fee, when paying by mail without a toll tag.
Cars with a trailer pay twice the base rate per mile.
Tractor trailers pay four times the base rate if they are hauling one trailer and five times the rate when hauling two trailers.
The North Texas Tolling Authority, which manages toll roads in and around Dallas/Fort Worth, including Dallas North Tollway and President George Bush Turnpike, charge 16.2 cents per mile on average, said NTTA Media Relations Manager Michael Rey.
The initial toll rate for the segment between U.S. Highway 69 and Texas Highway 155 was 50 cents when tolling began in 2006. The rate is now 69 cents but still below the 75 cents TxDOT expected to charge before residents spoke up at public hearings for a lower rate.
The first segment opened in 2006 connected Texas Highway 155 with U.S. Highway 69.
The connection to I-20 in March 2013 was a major milestone for the project. Officials anticipated daily transactions to escalate significantly with the connection. Owens said daily transactions on Toll 49 reached more than 29,000, well above early projections.
Revenue projections for 2015 are expected to be up more than $2 million, Owen said.
Proceeds from the toll road go toward the operation, maintenance and expansion of the road, Owen said. Future expansion of the Toll 49/East Texas Hourglass, which includes connecting existing segments to I-20 east of Tyler and segments in Gregg and Harrison counties, will depend on traffic.
The next leg, the Lindale Relief Route, will extend north from I-20 and connect with U.S. 69 north of Lindale. A recent $55 million state grant, which effectively would forgive NETRMA debt, could mean construction of the relief route might begin as early as next summer.
“FREE” vs TOLL
The argument for making the project a toll road has been that tolling would expedite construction by decades. State transportation funding is based on priority and booming metropolitan areas, such as Dallas, Austin, San Antonio and Houston, have the highest priority and receive about 75 percent of Texas highway dollars. The other 25 percent is divided between more rural areas around the state.
In officials view, competition for transportation dollars made tolls the most viable alternative to get the project moving. With traffic along Loop 323 and main arterial roads swelling, officials pushed for construction to begin sooner than later.
Opposing voices viewed Toll 49 as a poor option to relieve traffic. They also felt it was a ploy to enrich developers with land holdings along the route.
There was doubt among much of the opposition that Toll 49 would draw traffic away from “free” roads. They dubbed the first segments “a road to nowhere” because it lacked connectivity.
But as each segment opened, value to drivers increased.
Owen said the NETRMA knows there is value to drivers like Boyd. The authority performs “sensitivity studies” based on interviews with local residents to determine how they value their time.
There is a bell curve when it comes to tolls, Owen said. Low toll rates don’t generate much revenue but increasing toll rates beyond a certain point discourages use, which means revenues decrease.
“There definitely is a theoretical point where if you go over that amount, you’ll actually collect less money,” he said.
Boyd said what he pays for time saved driving could change his route back to free roads at some point if the rate continues to rise.
“At some point I might take the back roads when I’m not in a hurry,” Boyd said. “If the cost gets too expensive, I could see going that route.”
Charlie George, of Tyler, said she avoids Toll 49 at all costs. Ms. George didn’t like the project once it transitioned from a state funded loop to a tolled road.
“I just see it as wrong for tax dollars to go toward a toll road,” she said. “The people who don’t use it pay for it and the people who do use it pay twice.”
Ms. George is suspicious of the reliability of toll cameras that log vehicle license plates and the billing process. She and other area disabled veterans have been wading through a “huge stink for two years” regarding tolls wrongly charged to drivers with disabled veteran license plates.
NETRMA began charging disabled veterans tolls when it took over management from TxDOT in March 2013, but the board approved action to waive fees to qualifying veterans in August after veterans lodged complaints.
The tolling apparatus are “99.99 percent” accurate, Owen said. Some tolls are lost, due to power outages and vehicles with no license plates. Some are double-billed, but there are few problems overall, Owen said.
Owen said he understands some people are philosophically opposed to Toll 49. But as long as people value time over money, they will continue to drive it, he said.
“It’s a user fee. People have to decide whether they get value from using it,” he said. “Evidently a lot of people see value in it.”