Tolls: Coming to a Road Near You?

Virginia officials just received preliminary approval from the Federal Highway Administration to install tolls on one of the state’s major highways. “The ability to toll I-95 will help,” says Gov. Bob McDonnell, “by funding transportation improvements in this vital corridor.”

According to the story in today’s Washington Post, the state estimates it would collect $250 million in tolls in the first five years of operation and more than $50 million a year after that. Under federal rules, that money would have to be used to improve or expand capacity on the highway where it is collected.

As one of the most heavily traveled corridors on the East Coast, I-95 certainly warrants the investment. State transportation officials rank the entire highway as a ‘D’ in average level of service, with some portions scoring an ‘F’ during peak travel periods. I travel that road a few times a year to visit family in my native state, so I can attest to the highway’s critical condition.

But it struck me as odd in today’s political climate that a Republican governor would be so bully about slapping additional fees on drivers. The town where I grew up is about 20 miles due south of Richmond and up until my late teens there was a toll booth on I-95 that separated us from the capital. I remember how unpopular the 25 cent toll was back then, and how thrilled area residents were when the booths were removed after the massive road construction project for which it was intended to pay was finally completed. (What that particular project was I can’t recall, nor can I understand how any highway could ever really be deemed “finished” given the immense costs associated just to maintain it in safe condition.)

So why would elected officials trumpet that new tolls are on the way? Well, it has to do with dire straits. Not Dire Straits the band, mind you. Because when it comes to our nation’s transportation system there is no such thing as money for nothing. Simply put, the ever-increasing costs of building and maintaining highways, trains and mass transit to keep Americans safely moving requires keeping the cash flowing to pay for it all.

The federal Highway Trust Fund is the nation’s principal source of transportation funding. This money is generated by the 18.4 cent-per-gallon federal gas tax, which hasn’t been raised in nearly 20 years. Since the average gas mileage of cars in the United States has gone up – and will continue to rise thanks to new fuel economy standards recently enacted by the Obama administration – there simply isn’t enough money in the fund to keep pace with transportation infrastructure needs. The gap is enormous. As noted in today’s story, “The U.S. Chamber of Commerce estimated six years ago that $222 billion a year was needed to maintain the surface transportation system. Revenue flowing into the Highway Trust Fund was falling about $45 billion short of that amount.”

Until Congress can figure out how to close that funding gap we’ll have to wait for reauthorization of the federal surface transportation law. Meantime, states are forced to be creative about alternative ways to pay their transportation bills. Tolls represent a proven source of revenue that can help do that.

My colleague Deron Lovaas, NRDC’s Transportation Policy Director, sums up the situation in his blog

“In the absence of federal transportation dollars, state and local agencies are scrambling for ways to keep this country moving. A few have been testing a strategy that policy experts have long recommended, called value pricing. The idea behind value pricing is to create variable prices for our transportation choices that reflect the true cost of those choices.

Every time we drive, we inflict wear and tear on roads and bridges. We create traffic congestion and pollution. When we park, we use land – which we now know has value as a water filtration system or wildlife habitat when undeveloped. So if you want to use a road or bridge or parking space at the same time everyone else does, it’s going to cost you more – just like airline tickets on holiday a weekend.”

There you have it: tolls are a form of value pricing. Across the country where they are already in place, drivers are facing more frequent toll fare hikes to pay for road maintenance and improvement projects that are being hampered by budget shortfalls and declining gas tax revenue.

Currently, only 2,900 of the 46,730 miles in the interstate highway system are tolled -- but that could soon change as more states grapple with how to fill their transportation coffers.