Editorial: Time For A New Deal, Leesburg Today, January 15, 2015

It is the dawn of a new year, and, for Loudouners, that means it’s time to renew their futile protests against plans to ratchet up toll rates on the Dulles Greenway.

It’s an annual exercise in frustration that is no closer to resolution today than a decade ago.

The dance is a familiar one. Members of the county’s General Assembly delegation join area residents in expressing outrage that the State Corporation Commission would even consider yet another toll increase. Then SCC leaders respond that their hands are tied because the General Assembly has ordered the annual toll hike be approved.

Over the years, the General Assembly has done a good job of noting the many community problems caused by high toll rates, but it has failed to address any of them. However, residents should clearly understand that no other body can solve them.

The financial impacts of high tolls and the lack of distance pricing on area families is fairly obvious. The community impact of commuters avoiding the freeway and clogging neighborhood streets each morning and afternoon has been frequently discussed. Even safety concerns about having construction traffic and large trucks bypassing the highway have been repeatedly cited.

Perhaps they are merely local concerns that don’t resonate with General Assembly members.

How about an issue that should? Economic impact.

Click here for this editorial's look at the economic impact.

There is nothing in this editorial that hasn't also been said about the planned huge increases in the Dulles Toll Road tolls (now set for 2018 since the state coughed up $300 million to keep them down for a few years) to help cover the debt service payments for the Silver Line.

In the end, it will be the economic impact that drives the General Assembly to make a change, but--if history is any lesson--probably not until it is too late.  And we're getting there rather quickly as the cutbacks in federal spending have meant low to no growth in the area already and, therefore, no/low growth in county and state tax revenues.  Yet local and state governments want to spend more without raising or adding new taxes.  It won't work. 

Hold on to your seats, we're in for a bumpy economic ride.   

Greenway tolls go up on Friday, again, WTOP, April 11, 2014

Ari Ashe reports:

Tolls are already high on the Dulles Greenway, but starting Friday the rates will go even higher.

A one-way trip during rush hour jumps from $4.90 to $5.10, regardless of whether you pay with cash, credit card or E-ZPass. For commuters on the Dulles Toll Road, the trip will cost minimum $6.10 because of the exit fee. Round-trip, five days a week through the Dulles Toll Road could cost commuters $3,000 per year, or more.

"It is unbelievable that in the midst of a major investigation into the practices of the Greenway, the owners of the Greenway would seek yet another rate increase," says Del. David Ramadan of Loudoun County.

"It is even more unbelievable that the SCC decided to grant the increase prior to our challenge even being heard by the full commission. It clearly demonstrates that the deck is stacked against our commuters, on whose behalf I am fighting."

Ramadan is suing the owners of the Dulles Greenway . . . .

Click here for the rest of this news report. 

Aside from the impact on Greenway users' wallets, the increased toll will also divert more commuters to local roads.  Restonians can anticipate more traffic on its north-south arterials, especially Fairfax County Parkway, as commuters from Loudoun County seek to avoid the Greenway tolls.

Examiner Local Editorial: Don't socialize debt of private toll road, Washington Examiner, April 13, 2013

Last Tuesday, Virginia's State Corporation Commission held the first of a series of three public hearings on the higher tolls now being charged on the Dulles Greenway by Toll Road Investors Partnership II, operator of the privately owned toll road owned by the Macquarie Group, an Australia-based hedge fund. . .

Public backlash from Loudoun County commuters over the rising tolls convinced Del. Joe May, R-Leesburg, chairman of the House Transportation Committee, to sponsor a budget amendment in the recent legislative session that would have had Virginia taxpayers purchase the Greenway, which is deeply in debt despite the state-approved tolls it currently charges.

But as The Washington Examiner pointed out in January, May didn't utter a peep of protest when former Gov. Tim Kaine handed over the state-owned Dulles Toll Road to the Metropolitan Washington Airports Authority in 2006 without the General Assembly's approval, knowing full well that DTR tolls will have to climb even higher than those on the Greenway to cover the debt incurred to construct the Metrorail Silver Line. . .

. . .  TRIP II (owner/operator of the Greenway) will soon enough figure out that raising tolls beyond the level that the public is willing to pay is counterproductive.

The real problem is that the same thing is likely to happen with the publicly built Dulles Toll Road, and nobody is talking about that.

Click here for the rest of this editorial.

And, of course, the problem with people not taking the DTR is that they will add to the gridlock already experienced on Fairfax County's other free public roadways, including key east-west roads in Reston.

Va. lawmakers consider buying Greenway, backing Dulles Toll Road debt, Washington Examiner, January 13, 2013

By Liz Essley

Virginia lawmakers are considering creative and potentially expensive ways to keep tolls low on two roads they don't control: the Dulles Greenway and the Dulles Toll Road.

State leaders are now negotiating to buy the privately owned Greenway, a toll road west of Washington Dulles International Airport. And the General Assembly is considering legislation that would allow the state to borrow money through a bond issue to pay for the road's purchase and upkeep.

"I have to be able to negotiate an acceptable deal in terms of what we pay for it," said Del. Joe May, R-Leesburg, who is leading the push to buy the road. "I'm optimistic we're going to find a deal that works for both sides." . . .

It is far from clear how these proposals will be received by Republicans from beyond northern Virginia on the House of Delegates Transportation Committee that May chairs or more broadly in the House of Delegates.  It also appears to extend far beyond what Gov. McDonnell is willing to do for toll road relief in northern Virginia as well.

If nothing else, the two bills are an opportunity for the Republicans to better position their candidates in the General Assembly and statewide offices for election this November if we may be so cynical.  Nonetheless, we wish Republican delegates May and Minchew, both from Loudoun County, the best in moving forward with this proposal to relieve the tremendous financial burden Greenway and Dulles toll road users will face in the years ahead.

Click here for the full article. 

Wolf Opposes Latest Greenway Toll Increase Request, FairfaxNews, December 4, 2012

Rep.Frank Wolf (R-Va.) says Loudoun residents are being “ripped off” by constant toll increases on the privately-owned Greenway and he is asking the State Corporation Commission to block the latest toll increase request.

In a letter to State Corporation Commission (SCC) Chairman Mark Christie, Wolf said the Toll Road Investors Partnership’s (TRIP II) application for yet another toll increase further emphasizes the tolls’ “unbearable cost.”  He cited a 2008 amendment to a state law governing the Greenway that forces the SCC to approve a toll increase if the application is no greater than a set formula.

“It is perplexing that a state law guarantees a profit for a private company at the expense of Loudoun residents, who are getting ripped off by TRIP II,” Wolf wrote. . . .

For the rest of this article, click here.

By our calculations, if Greenway tolls rise at their minimum permitted increase rate and Dulles Toll Road tolls proceed as CDMSmith projects, autos driving from Leesburg to I-495 will face $19 one-way tolls in 2030 (about $12 in 2012 dollars).  The annual cost for a commuter facing that gauntlet of tolls would be about $8,200 or $5,600 in 2012 dollars.  Even for "wealthy" Loudoun residents, that is large sum to stomach. 

Dulles Greenway Tolls Likely to Increase Maximum Allowed in January 2013

An article in the November 20, 2012, Loudoun Times reports that filed an application to increase tolls in January by the maximum allowed under their agreement with Virginia--3.54%, squeezing the last hundredth of a percent out of its allowable rate increase.

The increase would put peak period tolls at about $4.97 and base tolls at about $4.14 if Macquarie Infrastructure Group (MIG), 50% owner in the TRIP II Greenway toll road management group, goes for the maximum.   They are likely to drop the toll increases back to the nearest dime--$4.90 and $4.10. 

The Greenway has been losing money for MIG since the TRIP II agreement with Virginia was signed.  Macquarie's 2011 annual report shows that while revenues increased by 2.6% last year on higher tolls, traffic was down by the same percentage.  Nonetheless, its losses are shrinking.  They lost $18 million in 2011 versus $20 million in 2010.  A chart in its mid-1012 investor presentation indicates that quarterly traffic performance has stabilized (see below) and revenues are up 8.6% over the same timeframe last year, suggesting that Dulles Greenway losses this year will be smaller than last. 

 

 

Letter: Chamber: Blame State for Metro Toll Hikes, Ashburn Patch, October 2, 2012

Loudoun Chamber president Tony Howard makes the case for additional state transportation funding and cooperation in the General Assembly.

 Last month, the Metropolitan Washington Airports Authority held several public hearings to gather public input on the proposal to raise tolls on the Dulles Toll Road to pay for Virginia‘s share of the Dulles Rail Project. 

Though these toll hikes are planned to fund Virginia’s share of the project, MWAA was the one vilified by the opponents of this project.

On Oct. 17, the Loudoun Board of Supervisors will stage a public hearing on the proposal to create two special tax districts in eastern Loudoun to pay for the County’s share of the project.

No doubt the loyal opposition will again be out in force to oppose these tax districts and the completion of the Dulles Rail Project that is favored by 80 percent of Loudoun residents.

But even amongst the majority of Loudoun residents who favor Dulles Rail and other transportation investments, there are valid questions and even strong resentment over the state of Virginia’s transportation program.

The toll rate plan and proposed tax districts represent a new reality in Virginia, one in which the Commonwealth neglects its responsibility to fund transportation improvements and local governments are forced to raise the money needed to build new road and rail capacity.

But this is a reality that Virginians need not accept. . . .

Click here for the rest of this letter by Loudoun Chamber of Commerce President and CEO Tony Howard.  

Since it is rare (maybe unprecedented) that we find ourselves even generally aligned with any of the local CoC's on area development matters, we thought it useful to highlight the concerns expressed here by the Loudoun CoC, which are similar to our own. 

Indeed, we believe that, other than Fairfax and Loudoun counties, the Commonwealth of Virginia has the most to gain--or lose by permitting tolls to climb--with the building of the Silver Line.  The development that will come with arrival of rail will help fill all their treasuries from the associated taxes of so many types, but it will be substantially reduced if workers and residents go elsewhere because of high tolls. 

All three are ducking their investment responsibilities to make the Silver Line succeed and dumping it on the backs of the Dulles Toll Road users.   Indeed, the secret deal cut in 2009 among the Loudoun Board (different composition than at present), the Fairfax Board (almost the identical composition), and MWAA that forces toll road users to pick up well over half of the cost of construction--and three-quarters of any additional costs--was one of the most grossly inequitable in northern Virginia history. 

We believe that toll road users should pay no more than one-quarter of the Metrorail construction costs in line with the 2004 Final Environmental Impact Statement (FEIS).  MWAA and the local counties should step up to pay the difference--about 54% instead of 25% agreed to in their secret deal--barring additional state or federal funding.  The state should also substantially increase its contribution in line with its support for other large transportation infrastructure projects in southern Virginia and the tax gains that can be anticipated.  And the federal government, whose approval of a $900 million grant got this project started, needs to add to its limited funding effort as well, even if it is only a TIFIA loan. 

Letter: AAA Opposed to MWAA's Toll Plans, Fairfax Patch, September 16, 2012

"It was a rotten formula at the start whose stench only gets worse with each passing year and the skyrocketing tolls that come with it."

With another increasingly expensive round of toll fee hikes in the offing for users of the Dulles Toll Road, according to the Metropolitan Washington Airports Authority (MWAA), AAA Mid-Atlantic wants to reiterate clearly and loudly its opposition.

We understand that someone has to pay for the $6 billion cost of the construction of the Silver Line, but the overriding question in our mind is just who that should be. At last check, local motorists, via their tolls, are being forced to shoulder nearly 60% of the costs of this project. . . .

. . . We urge MWAA, as it prepares for its latest round of hearings, to slow the escalation of these fees. The costs of a project of this magnitude that will benefit an entire region should not be borne so disproportionately by the drivers on the Dulles Toll Road.

It was a rotten formula at the start whose stench only gets worse with each passing year and the skyrocketing tolls that come with it. As the latest round of toll hikes for a round-trip on the Dulles Toll Road prove, they don’t call it the “Silver Line” for nothing, but we think it’s now more deserving of a new name: “Platinum Line.”

Lon Anderson
AAA Mid-Atlantic Managing Director of Public and Government Affairs.

 Click here for the rest of AAA's letter. 

"Distance Pricing" Talks for Greenway Fail; Need to be an MWAA Priority for DTR

In a comprehensive article in a recent Leesburg Today entitled "Another Greenway Toll Compromise Stalls," Erika Jacobson Moore writes about the breakdown in discussions between Loudoun legislators and Greenway management to institute "distance pricing" for tolls there.  

"Distance pricing" is simply paying for what you use when taking a toll road.  Toll road users don't have it on the Greenway, and we don't have it on the Dulles Toll Road.  It is the only fair way to charge tolls, but toll road managers, including MWAA for the DTR don't care.  

• There nominal complaint about distance pricing--and the one they're using on the Greenway--is that it would cost a lot to install the new equipment.  Dulles Greenway management puts that cost at $6-8 million.  
• The REAL issue, however, is that distance pricing would mean lower toll revenues as people using less than the whole toll road would pay less than a full toll.  In turn, that would mean toll road managers would have to raise the tolls on the toll road to meet their revenue requirements, primarily paying off debt.  
• Also, they find it unattractive because they would have to raise the base toll rate--probably by a third or more--to make up for the lost tolls from partial length toll road users. 

This is especially a problem for Reston drivers who use the DTR.  Sitting about half way from either end of the toll road, they are paying about twice as much per mile to use the DTR as people driving its full length under the current tolling scheme.   So, while the average per mile toll rate for the Dulles Toll Road users is about $.17/mile--very near the national average--Reston area toll road users (who comprise about half the vehicles entering/leaving the DTR according to the CDMSmith report--see "DTR 2011 Weekday Traffic Profile") are paying as much as their Greenway counterparts at peak period pricing--$.34/mile.

So what is the first priority of the MWAA Board in terms of tolling changes (besides, of course, hiking tolls in multiples over the next 40 years):  It's peak period pricing.   That is, MWAA is exploring the idea of increasing the tolls even further during the busiest periods of the day--morning and afternoon rush hours.  They want to do that because they don't have to modify their current toll collection structure (other than changing the toll charged) and they will end up with greater revenues!  It's a true win for MWAA and, yes, once again, a huge loss for most Dulles Toll Road users.

Toll road users, the Boards of Supervisors in Loudoun and Fairfax counties, and our state legislators must all push MWAA  (and, for that matter, the TRIP II partnership that runs the Greenway) to adopt distance pricing to assure toll road users are treated fairly.  And that would be a change!

For more on the exorbitant price per mile paid by Reston toll road users, please click on "DTR Fact Sheet #4:  Exorbitant Reston Toll Cost per Mile."

News Flash: Drivers Avoid Tolls, Sightline Daily, June 28, 2012

Over the past couple of months, we have detailed how the explosive growth in tolls in the Dulles Toll Road as forecast by MWAA's traffic and revenue forecaster, CDM Smith, will result in the diversion of a substantial volume of traffic to other local roads.  The diversion derives from two sources:

• The toll increases become less affordable for drivers and their "value of time" calculation (a CDM Smith turn of phrase--price elasticity of demand in economic-speak) makes them change their preference for using other roads.
• Over time, the growth of jobs and population along the toll road corridor sees an unmet potential as many of these new potential toll road users divert to other roads, switch to some form of public transit, or work from home.  

The results as we have calculated them suggest the following near and long-term consequences:

• Next year, if tolls double as forecast, CDM Smith forecasts that toll road use will decline by 18%--or 36,000 trips per day given the more than 200,000 daily trips on the toll road according to a survey by CDM Smith.  Since there will be no Metrorail and Fairfax and Loudoun County have no plans to expand bus transit for the one-year gap before Phase 1 of the Silver Line is in service, that means 36,000 trips per days on area roads.
• In 2050, more than 100,000 trips per day will be diverted to local roads by our calculations.  That allows for one-quarter of the future growth in employment and population in the "prime market area" (roughly the area north of Rt. 50 and east of Rt. 15--Leesburg) to take public transit (bus & rail) or work from home.  The job and residential growth estimates are those by CDM Smith's socio-economic forecaster, Renaissance Planning Group.  

Here's what that result looks like over the next four decades:

 


Now it appears that we are not alone in forecasting huge traffic diversions from exorbitant toll increases.  Sightline, a non-profit Washington state-based planning group, reports in an article by Clark Williams-Derry in Sightline Daily that Seattle in facing the consequences of major toll increases for a major area tunnel.  Here is how his article, "News Flash: Drivers Avoid Tolls," begins:

For Seattle traffic-watchers, Mike Lindblom at the Seattle Times has the most important story of the month: the news that a new state traffic study predicts that high rush hour tolls on the Alaskan Way Viaduct tunnel will divert 9,100 cars into downtown Seattle during the afternoon commute. For those of you who are counting, that’s a diversion rate of about 42 percent.

The Times editors considered it a bombshell. It was the day’s top story, above the fold, with a huge headline.

But here’s the thing: it’s not really news. Well, it’s only sort of news. I mean, there really was a new tolling study on the Viaduct, and it really did predict that lots of drivers would avoid the tolls by driving on surface streets. Yet the new study reached almost exactly the same conclusion that WSDOT itself reached last year.

Williams-Derry makes an important observation about why the insight--provided a year earlier--was largely ignored:

I suspect it’s part of a regrettable human foible: in context of a political campaign or a hotly contested public policy controversy, people view facts as weapons for winning arguments, rather than as a means for discovering the truth. When emotions run hot, the press tends to evaluate factual claims for how they’ll affect each side’s political fortunes, not for whether they’re important or true.

Now that the the political controversy has subsided, the press can once again cover the facts about the Viaduct a little more rationally: weighing their validity and exploring the implications. Better late than never I suppose. Still it’s a shame: just when the public was in greatest need of solid facts, the press seemed more focused on the politics than the substance.

In the context of the Dulles Toll Road, we have seen some reporting on the toll increase-traffic diversion phenomenon from local newspapers, particularly Patch.   Still, most of the media's focus has been on the comments of politicians and advocates (pro or con, left or right) rather than on the facts--more accurately, a balance assessment of the available data--as Williams-Derry suggests. 

So while the Fairfax County Board of Supervisors cared not a whit about these assessments nor conducted any of their own on the implications of higher tolls, the Loudoun Board considered but disregarded the traffic and other implications of huge toll increases on BOTH the DTR and the Greenway, and the state of Virginia has not even begun to fathom the implications for its transportation budget planning, we now face a situation where all parties are flailing to find funding to lower tolls and minimize the impact of diversions.

When politics trumps rational and systematic planning and problem solving, the community--local, county, state, and even federal--pay the consequences of poor decision making, in this case, for at least four decades.  

Frank Wolf Asks Attorney General to Probe Greenway Tolls, Fairfax News, July 18, 2012

By Jim Hood

Rep. Frank Wolf (R-Va.) today asked the Virginia Attorney General to have his consumer protection office examine the toll structure on the Dulles Greenway, charging that Greenway users are the victims of “highway robbery.”

“I believe you have the ability to give these residents a way to fight what I call ‘highway robbery,’” Wolf wrote in a letter today to Attorney General Ken Cuccinelli.  “If there were ever a group of consumers in need of protection, it is those who pay the Greenway tolls.”

Wolf, a longtime critic of the TRIP II, the firm that operates the Greenway, and its foreign-based parent company, Macquiare Ltd., believes the original state law allowing a private corporation to own and operate the Greenway is flawed because it fails to protect the consumer. . . .

Click here to read the rest of this article.

Congressman Wolf makes an important point.  Under the current agreement with Virginia, TRIP II has the right to increase tolls at the GREATER of GDP growth, inflation, or 2.8% through 2020.  No discussions have addressed the future beyond that date.  At the moment, it is difficult to believe either inflation or the economy will grow at more than 2.8% over the rest of this decade.

Yet tolls on the Dulles Toll Road are forecast to grow at a much greater rate.  Tolls are forecast to double next year and triple in 2018 according to the official MWAA forecast.  That means tolls will be growing at a 14.7% annual growth rate through 2020.  Even if the forecast horizon is extended to 2050, Dulles toll road users face a more than octupling of tolls or an annual increase in tolls averaging more than 5.7% through 2050. 

Moreover, TRIP II must seek state approval for its increases, meaning it will need to get state approval for rate changes beyond 2020.  MWAA faces absolutely no review of its toll rate changes.  There is no federal or state authority overseeing its rate increases at any point under the agreement Virginia made with MWAA to manage the toll road. 

If we assume that the Greenway extends its current rate increase terms and the DTR tolls proceed as forecast, drivers from Leesburg and points west will face a toll of $30.89 in 2050, or $12.09 in today's dollars at a 2.5% inflation rate.  Route 267--the Greenway and the DTR--will truly become the HIGHWAY OF THE ONE PERCENT. 

Here's what that looks like: