Federal lawmakers will have to become more comfortable with tolling highways, tunnels, and bridges if they want to obtain the revenues needed to create a national infrastructure bank or fund large capital projects in the future, transportation advocates said yesterday.
If policymakers do not embrace tolling and pricing fully, the [national infrastructure bank] as a source of additional investment "is not going to compute," Bryan Grote, co-founder and principal of Mercator Advisors LLC, said during a conference here yesterday hosted by the International Bridge, Tunnel, and Turnpike Association.
Tolls would provide the needed revenue source for the bank, he said.
A national infrastructure bank has been proposed by House and Senate lawmakers as well as by President Obama. However, lawmakers have not settled on a funding source for the bank. Just this week Congress signed off on a bill that specifically did not appropriate money for such a bank. The lawmakers felt that the bank should be created through the authorization process.
Those lawmakers will eventually have to ease restrictions on tolling by state and local entities and the use of public-private partnerships if they want to create a bank that provides loans for infrastructure projects, Grote said.
But some members of Congress have pushed for even greater restrictions on, and oversight of, tolls and P3s. The only multiyear transportation bill that has been introduced so far would create a new federal office with approval powers over P3 projects and toll rates. That bill, which was introduced by House Transportation Committee chairman James L. Oberstar, D-Minn., is pending in the House.
Meanwhile, states are wrestling with how to make long-term transportation investments at a time when traditional revenue sources and federal grants are increasingly uncertain.
The highway trust fund that states have relied on for most of their highway spending has been dwindling. The American Association of State Highway and Transportation Officials predicts the trust fund will be $65 billion in the hole by 2015.
Nineteen states made transportation spending cuts for this fiscal year, and many states have enacted laws to help them enter into P3 deals.
One of those states is the "big gorilla," California, said Patrick Harder, a partner at Nossaman LLP in Los Angeles.
Toll roads have been responsible for more than 20% of new highway and bridge capacity in the past decade, said John Horsley, executive director of AASHTO. That will probably rise to 50% over the next decade, he said.