Illinois Tollway proposes 90% toll rate hikes - in support of smaller capital program

August 2, 2011
By Peter Samuel

Illinois Tollway staff and consultants are proposing big toll increases for cars to support a 15 year capital program that's about 70% repair and 30% new capacity. Toll rates for cars would rise between 88% and 100% in the new year, while truck tolls would grow at previously announced levels in 2015.  At least for cars toll rates in Illinois are low in the sense that they are well below revenue maximizing levels. So the higher toll rates are expected to produce modest traffic loss and to generate significant extra revenue.

Total toll revenue is forecast to grow from $697m without the car toll hikes to $961m in 2012 with the approximate 90% hike in toll rates, $264m or 38% more total revenue cars and trucks combined. Car revenues are presently about $350m so the $264m extra represents a 76% increase in revenue from cars.

Present Illinois Tollway car tolls are among the lowest urban toll rates in the country at 3.3c/mile compared to a national average urban+ rural of 7.2c/mile, as estimated by traffic and revenue consultants Wilbur Smith Associates. Even with the 90% increase to an average 6.3c/mile the Illinois Tollway would only be one third the way up the national league ladder ranking car tolls/mile.

Average Tollway trips by car which are 19 miles would go from 63c now to $1.18.

But the percentage increase proposed is so unusual, so dramatic, it naturally generates shock and anger. And therefore strong public and political pushback.

Public hearings start soon and the Tollway board of directors still have to vote on the plan.

15 year $12b capital program, 70% repair, reconstruct, widen, 30% new

The toll increases are the underpinning to a $12.15 billion 15 year capital program that would spend an average $810m/year, comprising $536m/year on repairs, rebuilds and widening and $274m/year on new tollway and new interchanges.

The plan is actually a significant reduction in real capital spending as compared with the last 5 years. In that period $5.8 billion was spent, or an average annual $1,160m.  The $12.1b plan now being proposed 2012 to 2026 is about $9b in current dollars. Inflation is assumed to turn $9b into a requirement for over $12.1b  in current dollars.

In comparable dollars the $9b over 15 years represents average annual spending of $600m/year or about half the size of the last five years spending at $1,160m.

Biggest projects proposed are:

- Elgin O'Hare West Bypass 17 miles, 27km, and a mix of new toll expressway south and west of O'Hare Airport,  and a rehab and widening of the existing Elgin O'Hare Expressway, costing around $3.10b

-  I-90 Addams Tollway, better characterized by its former name Northwest Tollway with a near complete rebuild plus widening of 61.5 miles, 99km of the  which would go from 3 to 4 lanes each direction in parts and from 2 to 3 lanes on other parts, estimated to cost $2.37b

- I-94/I-294 Tristate Tolllway, the major belt route 78 miles, 125km from the Wisconsin line in the north to the Indiana line in the southeast,  estimated to cost $2.13b

Other projects:

- general systemwide improvements $2.41b

- systemwide maintenance facilities $506m

- project development on IL35, Illiana Expressway $126m

- I-355 Veterans Tollway better characterized by its earlier name as the North-South Tollway, an outer belt route to be milled, patched and overlaid plus bridge and ramp repairs to 30 miles, 50km at a cost of $511m

- I-88 Reagan Tollway formerly the East-West Tollway, a mix of reconstruction and mill, patch and overlay work, $389m

see details of the proposal here:

http://www.illinoistollway.com/portal/page?_pageid=133,2980078&_dad=portal&_schema=PORTAL

COMMENT: the higher toll rates are clearly justified, but a one-shot increase of 90% seems difficult to explain. Why not phase it in? And we're skeptical about any plans longer than about five years.

Apparently the Tollway is under some kind of legislative mandate to do the 15 year plan. We'd bet the Tollway's operators even five to ten years out won't feel any obligation to follow this plan.

Also, the item "general systemwide improvements" at $2.41 billion cries out for more detailed breakdown and explanation.

 

 

TOLLROADSnews 2011-08-01


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