Thursday, December 10, 2009

Unaccountable Regional Transportation Council wants NTTA to push toll taxes even higher

Michael Morris says NTTA should charge higher tolls during peak hours


Michael Lindenberger
Dallas Morning News
Copyright 2009

Michael Morris, director of the Regional Transportation Council, wants the North Texas Tollway Authority to commit to raising its toll rates on two major new toll roads, State Highway 161 in Dallas County, now under construction, and the soon-to-be-built Southwest Parkway in Fort Worth.

The rates should go up during peak hours, meaning that rates would go up when the need for the toll roads is greatest, said Morris.

That is already going to happen eventually on State Highway 121, Morris said, and doing so on the two new roads would help boost NTTA revenues. That's important, Morris said, because NTTA and the region are scrambling to bring the cost down on Southwest Parkway, and one way of doing so is to ask TxDOT to serve as a guarantor for payments to bond holders on both that road and State Highway 161.

That insurance from the state could save NTTA hundreds of millions of dollars on its efforts to finance both State Highway 161 and the 28-mile Southwest Parkway in Fort Worth, since it would entitle NTTA to lower interest rates. But, if the revenues from the roads were much less than expected, the state could have to kick in the difference in a given year.

Officials on all sides of the negotiations said that is highly unlikely. Still, Morris said the higher rates during peak hours would provide additional cushion, and lower the already negligible risks to TxDOT that it would have to cover any payments by NTTA.

So far though, the state has not agreed to offer the backstop on both roads, and some of its leaders have said in recent months that it would not do so.

Just now, John Barton, assistant executive director of TxDOT, is telling the RTC that the TxDOT commissioners are receptive to the idea of working with NTTA, but the department is still reviewing it.

Beyond the question of the financing terms, the presentation here has focused on ways to reduce the construction costs of Southwest Parkway, initially estimated at $1.87 billion. One way those costs could come down significantly is if the project is built in stages.

No decision on how to proceed has been made.

"I don't think we are there quite yet but it is an enormous step," NTTA chairman Paul Wageman said.

Update: Michael Morris takes issue with this characterization of his comments today. He makes two points: a) he would push for the NTTA to include the rush-hour pricing approach only if doing so helps make the financing more attractive, something that won't be known for sure until a final agreement is reached with the state department of transportation and whatever deal is struck is reviewed by credit rating agencies, and b) the higher rates would only be required if revenue from the new roads fails to meet requirements set by the lending agreements.

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