Portland Press Herald / Maine Sunday Telegram
Upkeep costs fueling toll hikes nationwide
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Officials say revenue needed to cover higher costs, drop-off in turnpike use
By DAVID HENCH, Staff Writer October 18, 2008
Gordon Chibroski/Staff Photographer
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Gordon Chibroski/Staff Photographer
Southbound traffic passes through the York toll plaza Friday. Massachusetts raised its tolls last December, Delaware tolls rose last month, and a toll hike will take effect in New Jersey in December.
Gordon Chibroski/Staff Photographer
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Gordon Chibroski/Staff Photographer
A motorist receives his change at the York toll plaza Friday after giving a toll collector $1.75 for the trip south. Eliminating a proposed York plaza relocation wouldn’t help the turnpike’s cash flow, officials say.

The economic forces leading the Maine Turnpike Authority to increase tolls a year ahead of schedule – sharply higher maintenance costs and reduced use – are being felt by turnpikes around the country. Rising fuel prices not only have forced Americans to drive less, but also have driven up the cost of petroleum-dependent products such as steel and asphalt.

The result has led several turnpike authorities – from Florida to Texas to Delaware – to raise tolls sharply or consider increases sooner than planned. In Maine, the challenge of predicting construction costs and revenue has the authority considering more frequent toll increases, instead of the five-year cycle it has been using.

"If we could do this without having to increase tolls as much, we would be. It's just not doable," said turnpike authority Executive Director Paul Violette.

The authority's board of directors voted Thursday to raise tolls 23 percent in February 2009, rather than in 2010. The increase will generate $18.5 million in new revenue next year for operation and maintenance of the 109-mile highway, and $20 million in succeeding years.

The authority broke the news to the Legislature's Transportation Committee on Wednesday, but the announcement generated little surprise or outrage, said Sen. Dennis Damon, D-Hancock, the committee's chairman.

The Maine Department of Transportation also faces a major challenge in funding a growing list of needed road improvements with declining revenue.

"We're in a bad fix," Damon said. "It's a terrible thing at this time in our economy to be raising taxes or fees – I understand that. I also realize how important our transportation infrastructure is to the state and the economy. To neglect it is more serious than raising a tax or a fee."

A 1.7 percent decline in turnpike usage does have a silver lining, though. A $75 million project to widen the turnpike from Scarborough to Falmouth has been postponed until at least 2015 because it is not immediately necessary.

The turnpike authority says that without moving up the toll increase, it would not be able to borrow money for the construction projects necessary to prevent serious and costly deterioration.

It lacks even the cash to pay for $24.5 million in required paving and related maintenance. This work is mandated by terms of the bond agreements under which it has borrowed money for past improvements. Much of its long-term maintenance schedule is dictated by the terms of the borrowing it has done.

To raise money for road projects, the authority issues revenue bonds, paid back with money generated by tolls. The authority enjoys favorable interest rates and has a high credit rating.

In return, it must abide by strict requirements related to the condition of the turnpike and its financial solvency. And that's where the need for a toll increase comes in, officials say.

Without an increase, the authority projects it would have roughly $88 million in income in 2009.

The Legislature approved a $46 million operating budget, but the authority plans to cut that to $40 million, up 1.8 percent from this year. The increase is attributable to the rising cost of salt, diesel and gasoline.

In addition, the authority must make $29 million in bond payments, leaving roughly $13 million for required maintenance. There would not be enough cash flow to support any new borrowing or the mandated maintenance.

Eliminating a proposed relocation of the York toll plaza wouldn't change the situation because the toll plaza, located on one of the most accident-prone stretches of road in the state, still must be reconstructed, at a cost of roughly $35 million. The project would be paid for with long-term borrowing, officials said, rather than cash.

Failing to fund $24.5 million in required maintenance, which is identified annually by an outside construction...


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