The Truth About Tolls

No silver bullet to make up for stagnant gas tax

Trucks travel north on Interstate 95 near Joppatowne, Maryland. (SCOTT J. FERRELL / CONGRESSIONAL QUARTERLY)
Trucks travel north on Interstate 95 near Joppatowne, Maryland. (SCOTT J. FERRELL / CONGRESSIONAL QUARTERLY)
Posted May 29, 2016 at 7:00am

Business, industry, transportation, labor and policy-making leaders from around the country came together during “Infrastructure Week” to discuss the many ways infrastructure affects our economy, quality of life, safety and communities. Amid talks of engineering, innovation and managing population growth, one question hung over every discussion: How will we actually pay for this?  

As our nation grapples with its aging roadways, many political leaders have been unwilling to make hard decisions to find the right blend of financing for America’s roadways. Many states have recently raised state gas taxes because of Congress’ unwillingness to do so at the federal level. This is despite evidence that raising the gas tax is not a political death sentence. Last year, the American Road and Transportation Builders Association found that 95 percent of Republicans and 88 percent of Democrats who voted to increase their state gas taxes won re-election races.  

With the federal gas tax stagnant, states need various highway funding solutions. They can consider registration fees, supplements from income, sales and property taxes, or even per-mile road usage charges. There is no silver bullet, no single right answer. But there is a wrong answer in funding transportation: putting tolls on roads that motorists currently use toll-free.  

Pro-tolling arguments are the epitome of politicians passing the buck: “If you don’t use the road, you don’t pay for it.” In reality, tolling roads that currently don’t have tolls hurts budget-strapped states that need real solutions to repair and maintain existing interstate infrastructure, and it has real, negative consequences on businesses and families.  


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While building new roads and paying for them with tolls has been appropriate and successful in some places, it’s a different situation on existing interstates. The federal government recognizes this and requires a federal exemption to do so. The opposition to and ill effects of such policy are well-documented. In the 18-year history of the pilot program allowing this exemption, not a single toll has been added to an existing interstate. The pilot program’s overwhelming failure shows it’s time to turn to more realistic, cost-effective and proven solutions — of which tolling is not.  

From a purely pragmatic perspective, building, staffing and maintaining toll facilities is inherently inefficient and takes many years to generate any net income. According to the National Academy of Sciences, the administrative, collection and enforcement costs of a typical toll facility are 33.5 percent of the revenue generated. Compare this to the academy’s finding that the administrative cost of the fuel tax is about 1% of revenue. Electronic toll collection is more efficient but still has upfront construction costs and can require 12 to 20 percent of the revenue collected for operation. That money should be going toward public infrastructure projects — not into tolling companies’ pockets.  


Ryan’s First Test: The Highway Bill


Aside from their inefficiency, tolls make roadways less safe by disrupting traffic patterns. Traffic diversion is a serious problem, crowding secondary roads near toll facilities. A 2013 study for the North Carolina Department of Transportation on the effects of tolls on Interstate 95 in the Tar Heel State predicted that tolls would divert up to 36 percent of traffic to alternate routes. This would contribute to delays, traffic accidents, and accelerated deterioration of smaller secondary roads not built for such high use.  

Congestion caused by toll diversion also delays response times for emergency personnel who rely on alternative routes to quickly get to and from accidents and emergencies, raising legitimate public safety concerns.  

Traffic diversion hurts local businesses that depend on interstate drivers for their income. The NCDOT study estimated that between 2014 and 2050, diversion around tolls on I-95 would cost approximately $1.1 billion dollars in revenue to businesses within a mile of the I-95 corridor in North Carolina. Tolls increase the cost of delivering goods and services, put local businesses at a competitive disadvantage and increase the cost of living for residents.  


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It’s important that the Interstate Highway System facilitate unrestricted commerce and travel throughout the country. Admittedly, today’s fuel tax revenues are not keeping pace with our highway transportation needs. Creative solutions must be explored, but tolls are by far the worst way to solve our transportation funding deficit.  

We can all agree that our beleaguered infrastructure needs help. But it must be the right kind of help. The data and facts are clear: Tolling hurts local economies and drives up costs for businesses and families. Policymakers should not settle for a detrimental financing option but pursue sustainable financing solutions that create economic growth and strengthen America’s future infrastructure.  

Kane is the spokesperson for the Alliance for Toll-Free Interstates, a national coalition of individuals, businesses and organizations that advocates solving our growing transportation needs without tolling our existing interstates .  

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