Minnesota DOT mulls over idea of new tolls with new study
February 16, 2018
While the federal infrastructure bill is still up in the air, states are trying to find out how to fund their infrastructure needs on their own in the meantime. In Minnesota, the idea of new tolls is floating around the state’s Department of Transportation.
As mandated by a Minnesota law signed by the governor last May, MnDOT published a toll study earlier this year that looked into the policies and financing regarding MnPASS lanes and tolling to reduce congestion and raise revenue. Not unlike other states, Minnesota is trying to find other sources of revenue as fuel-efficient vehicles are yielding less money from fuel taxes. Increases in fuel taxes tend to be unpopular among state and federal lawmakers.
MnDOTs study analyzed seven corridors throughout the study.
It should be noted that these corridors were chosen only for the purpose of analyzing traffic and revenue estimated throughout the state. They are in no way considered preferred corridors for future implementation at this early stage.
Collection is based on an all-electronic tolling system, using a combination of transponders and video imaging for those without transponders. Corridors were analyzed using high toll rate (10 cents per mile), medium rate (7 cents per mile) and low rate (4 cents per mile). As is typical in other states, a 50 percent increase to transponder toll rates is applied to video customers. Also standard is a truck toll rate multiplied by a factor of 3.8.
According to the study, estimated gross revenues over 30 years range from $336 million on the TH 610 urban freeway to $3.5 billion on the I-94 urban corridor. After adjusting for tolling costs and roadway operations/maintenance costs, the money left over that actually goes toward reinvesting in the corridor ranges from $157 million to $2 billion over 30 years.
After considering the length of the corridors, U.S. 169 results in the highest revenue available for reinvestment per mile. Conversely, I-35 has the lowest revenue available for reinvestment per mile. Urban corridors, except for TH 610, result in the highest amount of revenue available for reinvestment.
MnDOT also considered possible diversions from newly tolled corridors. For example, the study pointed out the Twin Cities metropolitan area’s interstate and freeway system provides readily available alternative routes if only portions of the system are tolled. Certain frontage roads can lure motorists to divert tolls on shorter trips.
When it comes to diverting away from tolls, the study also noted that trucks may have different diversion rates than passenger vehicles. Trucks are tolled at a higher rate than passenger cars, and typically have much higher values of time.
Although MnDOT is entertaining the idea of new tolls, the state has plenty of legal hurdles to cross. The study mentions its focus is on “feasibility of projects that generate revenue by converting existing general-purpose lanes of the studied corridors to toll lanes.” However, federal law prohibits the tolling of existing interstate lanes.
One way around that is the Interstate System Reconstruction and Rehabilitation Pilot Program, which allows up to three existing interstate facilities to be tolled to fund needed reconstruction or rehabilitation on interstate corridors that could not otherwise be adequately maintained or functionally improved without the collection of tolls. ISRRPP only provides authorization, not funding.
Missouri, North Carolina and Virginia held the previous spots for nearly 20 years when it was established in 1998. However, not a single proposed program has satisfied the pilot program’s criteria since then. The FAST Act established a timeframe of three years to meet criteria with a possible one-year extension
The three states that held those slots had one year from the enactment of the FAST Act to implement a program or request a one-year extension. All three states have decided to abandon their slots. This marks the first time since ISRRPP was established in 1998 for other states to take advantage of an open call for pilot projects under the program.
In October 2017, the Federal Highway Administration began accepting applications for those three slots. However, applications are due by Feb. 20, making it unlikely that Minnesota will have a decision and proposal ready in time to take advantage of ISRRPP.
Even if MnDOT receives the authority it needs, the agency is still at the mercy of the National Environment Policy Act, including President Bill Clinton’s executive order regarding environmental justice. Executive Order 12898 requires agencies to identify and address “disproportionately high and adverse human health or environmental effects of its programs, policies, and activities on minority populations and low-income populations” before implementing projects.
President Donald Trump’s recently released infrastructure plans calls for permitting reform. More specifically, Trump wants to reduce the amount of time it typically takes for NEPA reviews to be completed.
MnDOT concluded that “a more detailed study would be required before any decision is made to implement a specific toll project.”
Minnesota officially starts its 2018 legislative session on Feb. 20. It is likely that the Senate Transportation committee will discuss the report and toll options in the near future.