The ICC took in $39.6 million in the past fiscal year — almost dead-on the latest projection but $10 million to $32 million less than forecasts that Maryland lawmakers had in 2005, when they agreed to significantly increase the Maryland Transportation Authority’s debt to build it.
“They lowered the bar so now they can step over it,” said Montgomery County Council member Phil Andrews (D-Gaithersburg-Rockville), a longtime ICC critic. “When you merge onto the ICC, it doesn’t feel like a highway. It feels like an airport runway.”
How many vehicles are using the ICC matters to motorists across Maryland. The $2.5 billion highway, which was hotly debated for decades because of its cost and environmental and community impacts, was the most expensive ever built in the state.
Maryland lawmakers agreed to pay for it by greatly increasing the authority’s debt, including $1 billion worth of bonds and a federal loan backed by all state toll revenue. The state committed to raise tolls statewide, if necessary, to pay them off.
The highway’s massive construction debt also prevents the state from lowering ICC toll rates — $8 for a passenger car making an end-to-end round trip during rush hours — to attract more motorists. Doing so, a recent study found, would lower the 18.8-mile highway’s revenue, requiring motorists statewide to subsidize even more of its costs.
Transportation Authority officials say the ICC is a success. They point to a recent study done by the Metropolitan Washington Council of Governments that found that ICC motorists cut their travel time in half and that traffic on nearby roads had dropped by 5 percent to 10 percent. ICC traffic is growing by an average of 2.6 percent a month, officials said.
Earlier toll revenue estimates were “ballpark” projections made before ICC toll rates were set, state officials said. The projections also didn’t always reflect the need for a three-year “ramp-up” period for motorists to absorb the new road into their travel habits, officials said.
The state’s consultant, Wilbur Smith Associates, lowered ICC revenue projections significantly for the last time in 2010 — by $7 million annually — to reflect the effects of a global recession and rising gas prices, according to the reports.
Even so, state officials said, the ICC’s true financial impact won’t be known for five to 10 years, after traffic has stabilized. The last segment, between Interstate 95 and Route 1, is scheduled to open next year.
“The fact is, you always have [roads] built for a 30-year time frame,” said Bruce Gartner, the authority’s executive secretary. “You don’t build them for day one.”
State, federal subsidies
Motorists on Maryland’s seven other toll highways, bridges and tunnels have faced two toll increases in the past two years, in part to pay off mounting construction debt from the ICC and express toll lanes being built on I-95 north of Baltimore. On some facilities, such as the Chesapeake Bay Bridge, tolls more than doubled.
In the past fiscal year, about $1.8 million in toll revenue collected from motorists statewide helped cover the shortfall between the ICC’s toll collections and its annual debt service and operating and maintenance expenses.
ICC debt service also consumed $87.5 million in federal highway funds — 15 percent of Maryland’s total federal highway allotment in the past fiscal year.
“What other dangerous roads or bridges in the state aren’t getting fixed because they’re blowing all this money on the ICC?” said Greg Smith, an anti-ICC activist. “That’s a big question.”
Gartner, of the Transportation Authority, said the agency always intended to subsidize the ICC’s construction debt with toll revenue from across the state. The authority pools toll collections and directs the money to where it’s most needed, whether to build the ICC or repaint the Chesapeake Bay Bridge.
Robert L. Flanagan, who was state transportation secretary under then-Gov. Robert L. Ehrlich Jr. (R) when the ICC financing plan was approved, said Maryland could not afford the road without using statewide toll revenue and borrowing against future federal highway allotments. For decades, he said, planners had recommended building a highway outside the Capital Beltway to connect Montgomery’s I-270 jobs corridor with I-95 and, beyond that, Baltimore-Washington International Marshall Airport.
In setting the ICC tolls, Flanagan said, “I think there probably was a decision to maximize revenues rather than maximize the [traffic] flow. . . .
That remains a choice. You could reduce the tolls and maximize the flow, but somewhere, somehow you have to pay for those bonds you issued.”
AAA Mid-Atlantic spokesman Lon Anderson, a longtime ICC advocate, said the roadway is “underutilized” because motorists unaccustomed to paying tolls were scared off by the ICC’s high rates and visible police patrols. The ICC’s initial speed limit, 55 mph, was raised in March to 60 mph, but Anderson said motorists complain that it’s still too low to pay extra for.
“They had a low speed limit and police swarming it to ticket people who dared exceed that limit,” Anderson said. “People felt like they were paying a lot for the privilege of getting a ticket.”
Sen. Richard S. Madaleno Jr. (D-Montgomery), an ICC supporter who reviewed the financial plan in 2005, said lawmakers were well aware that paying off the ICC’s construction debt would require subsidies from statewide toll revenue and federal highway funds for 10 to 15 years.
“It was not supposed to be self-sustaining,” Madaleno said of the ICC. “If it had to be self-sustaining, the tolls would have to be so high, the project would be a failure.”
But Stewart Schwartz, executive director of the Coalition for Smarter Growth and a longtime ICC critic, questioned the validity of the toll revenue estimates that lawmakers saw when they agreed to build the road.
State transportation officials “may have been trying to sell the project despite its high costs and significant environmental and community impacts,” Schwartz said. “We shouldn’t be making multibillion-dollar decisions based on wrong data.”
Schwartz said the earlier forecasts missed the fact that the Internet revolution, with its online shopping and videoconferencing, would reduce the need to drive.
Some motorists might save time on the ICC, Schwartz said, “but is it enough people? Clearly there aren’t enough people traveling on it to justify the expenditure.”
Anderson, of AAA, said he believes that the use of the ICC will pick up as the economy recovers.
“I think its time will come,” he said, “but perhaps not as quickly as we thought it would.”