By Eric Boehm | PA Independent
This column was updated to correct the source of information on declining truck traffic on the turnpike.
HARRISBURG – Taking a ride on the ol’ Pennsylvania Turnpike will cost you a bit more starting this month.
And no, this isn’t a broken record — even if it sounds like one.
Burdened by a state law that requires it to transfer $450 million annually to PennDOT and with more than $8 billion in debt, the Pennsylvania Turnpike this week increased tolls for a fifth consecutive year. The toll hike took effect Jan. 6, with cash customers hit with a 10 percent increase; people using E-Z Pass will charged 2 percent more.
A trip from Ohio to New Jersey on the mainline of the turnpike will now cost $39.15 for cash customers, a 71 percent increase since 2008, and $30.77 for those using E-Z Pass, which is still a 36 percent increase in five years.
Did I mention that before 2008 tolls were increased on just four occasions in the turnpike’s entire history dating back to 1937? It’s true.
Before 2008, the turnpike had a much lower level of debt, about $2.9 billion.
So what happened in 2007 to set off this seemingly endless spiral of toll increases and unsustainable borrowing?
That year, the state Legislature considered a proposal to lease the turnpike to a private operator, but ultimately decided against it.
Instead, lawmakers concocted a plan approved as Act 44 of 2007, requiring the turnpike to hand over $450 million to the state annually. It would have been $900 million annually had the federal government allowed the turnpike to enact tolls on Interstate 80 – turning it into the Pennsylvania Turnpike North.
That annual payment is divided into $200 million for various road and bridge projects around the state and $250 million to subsidize mass transit, mostly in Philadelphia and Pittsburgh.
Of course, the turnpike still has to take care of its own operations and keep its own bridges in usable condition. It just has to do so with a balance sheet that is $450 million lighter.
The end result? Borrowing, lots of it, and annual toll increases to cover the spiraling debt-service costs. The turnpike has been turned into a cash cow for PennDOT, but the people getting milked are those who pay the tolls.
And there’s no end in sight — Act 44 requires the turnpike to make those payments every year until 2057.
Auditor General Jack Wagner has warned that continuing to increase tolls will, sooner or later, drive people from the high cost of using the turnpike and on to other roads that may not be designed to handle the traffic.
He says the tipping point may be coming sooner than anyone expects, and a report by the Pittsburgh Tribune-Review last week showing that truck traffic on the highway has declined in recent years seems to give his argument more weight.
While tolls and debt are mounting, the chiefs of the Turnpike Commission received vehicles valued at more than $28,000 each and piled up more than $500,000 in expenses for meals and hotel rooms, according to an audit completed by Wagner’s office and released last week.
The Turnpike Commission maintains its
debt is sustainable and points to internal projections showing an expected increase in traffic despite the higher tolls.
Time will tell who is correct, but as lawmakers and Gov. Tom Corbett get serious about transportation funding later this spring, some changes could be coming to Act 44. The House and Senate Transportation Committees have already held hearings on the law to study its adverse consequences.
Individuals and businesses that rely on the turnpike for business should certainly push for changes that address the debt and ever-increasing tolls on Pennsylvania’s most important highway.
This column originally appeared in the Jan. 10 issue of Region’s Business Magazine. Contact Boehm at Eric@PAIndependent.com and follow @PAIndependent on Twitter.