WASHINGTON — Two lawmakers representing Northeastern states are sponsoring legislation to give the federal government more control over bridge and tunnel tolls, a proposition that has won the backing of commercial truckers and motorist advocacy groups but could also put pressure on some bond issuers.
Sen. Frank Lautenberg, D-N.J., and Rep. Michael Grimm, R-N.Y., are sponsors of the Commuter Protection Act, which would allow the U.S. Department of Transportation to override tolls it deems too high. The DOT had this power until passage of the Surface Transportation and Uniform Relocation Assistance Act of 1987, which denied it authority to regulate tolls over navigable waters.
The two lawmakers cited “recent toll hikes, lack of accountability and fiscal mismanagement at the Port Authority of New York and New Jersey” as reason to allow the DOT to determine whether tolls are “just and reasonable.”
“When it costs $12 to drive your car across a bridge in America, something is wrong,” said Lautenberg, who chairs the Senate Commerce subcommittee on surface transportation that has jurisdiction over interstate transportation-policy issues.
Grimm, whose district includes New York City’s Staten Island, said toll officials shouldn’t have sole discretion over how much it costs to use the federal highway system.
“This bipartisan legislation brings oversight of toll rates on our nation’s federally funded highway system back into the Department of Transportation where it belongs,” he said.
The American Trucking Associations and American Automobile Association both announced their support of the bill.
But certain municipal bond issuers could feel a pinch if the measure were to become law, said Peter Murphy, senior director of the U.S. public finance infrastructure group at Standard and Poor’s. Murphy said government intervention leading to reduced toll revenue has the potential to affect the liquidity levels and debt service ratios of muni issuers, key factors financial analysts use in determining whether borrowers have too much debt. Under some circumstances, Murphy said, “a rating could be pressured or lowered.”
He said the impact of the legislation, if it was enacted, would depend on how active the department became in using its restored authority.
“Would they get involved in every single rate increase?” Murphy asked. “Some issuers don’t raise rates often, or do very modestly.”
The bill would also require Government Accountability Office to report on and make recommendations for increasing the transparency and accountability of tolling authority budget practices.
