In The News
FHWA denies Pennsylvania plan to toll I-80
The Federal Highway Administration announced Thursday that it did not
approve an application from the Pennsylvania Department of
Transportation and Pennsylvania Turnpike Commission to place tolls on
Interstate 80.
The agency said the planned use of toll revenues does not meet federal
requirements, as there is no basis to conclude that the proposed lease
payments are legitimate operating costs.
"Tolling interstates is a viable option for many states to fund highway
improvements or to improve performance conditions," Highway
Administrator Tom Madison said. "Because we are legally bound to ensure
applications for this program meet all congressionally mandated
requirements, however, we are regrettably unable to approve this
application."
Under the proposal, PennDOT would transfer I-80 to the Turnpike
Commission and make payments. But FHWA officials said the application
did not meet legal requirements for the correct use of toll revenue.
Specifically, the application called for the Turnpike Commission to use
toll revenue to pay annual lease payments to PennDOT. The federal
agency noted that while under the program toll revenue can be used for
lease payments, the amount of the payment is required to be based on an
objective market valuation.
The Commission's application, however, included no information or data
justifying the proposed amount for the annual toll payment or
establishing that the level was based on an objective market valuation.
The agency noted that earlier this year it had asked for just such
justification as it reviewed the tolling application. The Commission,
however, sent no additional information supporting the lease payment
level, the agency said.
"There is simply no evidence that the lease payments are related to the
actual costs of acquiring an interest in the facility," explained
Administrator Madison.
The legitimacy of the payments was questioned by The Americans for a
Strong National Highway Network, a coalition that includes members such
as the American Trucking Associations, the Owner-Operator Independent
Drivers Association), AAA and the American Highway Users Alliance, in a
letter sent to FHWA officials late last month. (See "Coalition Urges Feds to Reject I-80 Tolls," 9/2/2008)
According to the Philadelphia Inquirer, the decision puts new focus on
an effort pushed by Gov. Ed Rendell to lease the Pennsylvania Turnpike
-- a proposal that faces stiff opposition in the Legislature.
In May, a Spanish company and a unit of Citigroup teamed up to submit
the largest bid for the right to lease the Pennsylvania Turnpike for
the next 75 years. (See "Pennsylvania Could Lease Turnpike in 75-Year Deal,"
5/20/2008 ) But the chairman of the state House Transportation
Committee has said that legislation to authorize the proposed lease
will not get a vote in the committee he heads or on the House floor.