By Sandhya Somashekhar
Washington Post Staff Writer
Sunday, September 17, 2006

Letters from angry drivers keep pouring in to the State Corporation Commission (SCC), the regulatory agency that will decide whether to allow another round of toll increases on the Dulles Greenway.

Most of the letters say that the road operator's attempt to raise the one-way toll of $2.70 -- already among the highest in the region -- to a rush-hour rate of $4.80 by 2012 would be a severe blow to low- and middle-income commuters, forcing them to endure financial hardship or bumper-to-bumper traffic on alternative routes.

"The toll rates are already so high that poor and low income-earning drivers are denied access to the Dulles Greenway," one motorist wrote. An increase "will only punish the poor."

But under state law, the SCC's decision will have less to do with motorists' pocketbooks than with the private operator's bottom line. And the company, Toll Road Investors Partnership II, describes a troubled financial history in its application to the commission, arguing that it needs the additional toll revenue so it can begin operating in the black.

As it considers the company's request in the coming months, the SCC will weigh three factors that are spelled out in a 1988 Virginia law authorizing the construction of private toll roads in the state:

· Would the toll increases provide the operator with an unreasonably high rate of return?

· Would they significantly discourage the road's use by the public?

· Would the toll payment exceed the road's benefit to drivers?

The company attempts to show in its application that, in each case, the answer is no. Most notable is its assertion that it has operated at a loss every year since the 14-mile highway opened in 1995 and that its debt has swelled to $883 million, more than double the $326 million it took to build the road.

The company had expected to start turning a profit by 2003, and it had projected that its debt would be more in the range of $350 million to $400 million in 2006, TRIP II spokeswoman Ann Huggins-Lawler said last week. She said the debt stems mostly from lower-than-expected revenue during the Greenway's early years.

When the Greenway opened, it was the first privately owned toll road in Virginia since before the Civil War. Private ownership of publicly accessible roads has become more popular in the past decade, as companies have stepped in to build and maintain infrastructure that some say is being neglected by state governments.

Those new roads have come at a price, which is shouldered exclusively by the motorists who use them. Some have argued that it is only fair to charge those who directly benefit from the road, while others say roadways are a public benefit that should be supported with taxpayer money.

The Greenway, which runs from Leesburg to Dulles International Airport, receives no government funding. But it is subject to state regulations that require TRIP II to justify major toll increases before the SCC, which can approve, deny or alter the company's toll proposals.

The most recent toll increase took effect in January, when the one-way rate for passenger cars went up by 30 cents to $2.70. Under the company's proposal, the toll for cars traveling in the non-peak direction during non-peak hours would be increased incrementally starting Jan. 1, 2009, and reach $4 on Jan. 1, 2012. During rush hour, drivers traveling in the peak direction would pay $4.80 by that date.

The truck rate would go up on July 1, 2007. Currently, vehicles with more than two axles pay $5.40 one way. Under the proposed toll schedule, that would vary depending on how many more axles a vehicle had, with six-axle vehicles paying $9.45 one way.

To support its contention that the benefit to drivers would still outweigh the cost, TRIP II hired a consultant to analyze what motorists save when they take the Greenway rather than an alternative route. The savings in time -- 37 minutes per round trip during rush hour and 12 minutes per round trip at other times -- averages a value of $3.96 for passenger cars, according to TRIP II. After adding the value of the Greenway's safety and the value of reduced vehicle maintenance costs from less stop-and-go driving, the company came up with a total savings of $6.09 per one-way trip, more than the proposed 2012 toll.

The company also must show that the toll increase won't "materially discourage" drivers from using the roadway. On the basis of experience, the company says road usage drops immediately after a toll increase but recovers in six to seven months.

Last year, the Macquarie Infrastructure Group of Australia bought the majority interest in TRIP II, which was seen as a positive sign for the roadway's financial health. Macquarie owns more than a dozen private toll roads around the world.

In addition, use of the road has steadily increased over the years, parallel with the region's growth. According to data provided in the application, ridership has risen to more than 22 million vehicles per day, compared with about 14.5 million in 2000.

The hope now, TRIP II officials say, is to begin chipping away at the financial losses as well as to finance some road improvements in the next decade. But Huggins-Lawler said that even with the additional toll it is seeking, the company will not necessarily be able to turn a profit.

Opposition has begun mounting against the company's application. The SCC has received more than 100 letters opposing the move, including one from U.S. Rep. Frank R. Wolf (R-Va.), who did not oppose any of the previous increases. Both the Loudoun County Board of Supervisors and AAA have stated their opposition as well.

John Townsend, a spokesman for AAA Mid-Atlantic, said his organization had doubts initially that a privately owned highway would be in the best interest of the community.

Roads, he said, "are not a luxury."

"The whole thing about privatizing this road was to alleviate a burden for the state, which should look out for the best interest of its taxpayers," he said. "But now the burden has been shifted to motorists."