Dulles Toll Road users are shouldering nearly half of the costs of Metro’s soon-to-open Silver Line, a far bigger share than originally predicted.
Commuters are vulnerable because tolls are the one share of the Silver Line project’s funding formula that is not capped at a fixed dollar amount or percentage of the final tab.
Since construction began five years ago, there have been five toll increases that spiked a common round trip from $2.50 to $7 or, viewed as a monthly tab for typical weekday commuters, from $50 to $140.
The impact of the line’s rising costs has been painfully apparent to drivers who use the road regularly. Yet the significance of rising tolls as a main funding source drew less public attention than heated intrastate political battles and engineering skirmishes over tunnels.
In 2004, tolls were expected to cover about 25 percent of the Silver Line’s construction costs, according to an agreement between the commonwealth of Virginia, which launched the project, and the contractor, Dulles Transit Partners, led by Bechtel. Total costs were then estimated at $4 billion.
“We felt that having it set at a quarter of the costs coming from tolls would keep that at a reasonable level,” Rep. James P. Moran (D-Va.) said.
But as project costs rose, so did pressure to pull more revenue from the toll road.
The result? Five years of increases.
And it has been only the recent intervention of Washington and Richmond that added nearly $2 billion in funding for the Silver Line, mostly in loans, that spared drivers from paying even more.
Officials at the Metropolitan Washington Airports Authority, which is overseeing the Silver Line’s construction, and Bechtel, the contractor that built the first section of a two-phase project, maintain that the cost overruns and delays are not a bad outcome for a transit project that is among the largest of its kind underway in the United States.
It’s not a view that John Fringer shares.
The line “squeezes money out of us who are forced to use the toll road to pay for the cursed Metro,” said Fringer, 61, who pays $140 a month on round trips between Reston and his environmental engineering job in Rockville. His frustration is compounded, he says, by elected officials who “always get self-righteous about how the Silver Line is needed when you protest the tolls. It’s truly maddening.”
Once completed, the line will be operated and maintained by Metro.
The line’s first phase includes five new stations over 11.4 miles between Tysons Corner and Reston in Fairfax County.
This month’s opening date is later than the airports authority repeatedly promised, and so far the line has cost $2.9 billion, with bills still coming in.
A second phase of 11 miles and six stations will extend the line to Washington Dulles International Airport and into eastern Loudoun County, at an estimated cost of $2.7 billion. It is intended to open in 2018.
“I’ve been a little amazed at how it became so dependent” on toll road revenue, said Katherine K. Hanley (D), a Silver Line supporter who was chairwoman of the Fairfax County Board of Supervisors from 1995 to 2003, during many of the on-again, off-again years of the project.
Reliance was growing to the point that without higher tolls, the project might not be finished. The airports authority took responsibility for overseeing construction of the Silver Line from Virginia in 2006. As part of that deal, which officials said would save money and speed construction, MWAA also assumed control of the Dulles Toll Road and was given the authority to raise tolls.
Standoffs in Richmond between then-Gov. Timothy M. Kaine (D) and the General Assembly over legislation to increase taxes and fees to fund transportation limited the state’s help on the Silver Line’s first phase and left the handover of the toll road as the state’s most significant upfront contribution, according to Kaine, now a U.S. senator.
Under the 2007 funding agreement, Fairfax and Loudoun counties and the airports authority combined were committed to 25 percent of the project’s total costs. The federal government contributed a firm $900 million to the first phase.
Funders including the state of Virginia could opt to add money, but the only other committed portion was toll proceeds, and those weren’t at a locked-in amount.
That leaves tolls as the project’s only open-ended funding source.
“Tolls upon the Dulles Toll Road are the primary financing mechanism for successful conclusion of the [Silver Line] project,” reads a March letter to the U.S. Department of Transportation from 29 Northern Virginia delegates supporting a request for low-interest federal loans. That assessment echoed in the loan application from the airports authority.
Favorable loan terms would reduce the project’s borrowing costs and “work toward our goal of mitigating toll rate increases” for drivers “to the greatest extent possible,” the letter said.
That appeal paid off in April, with nearly $2 billion in loans that MWAA said will enable it to freeze tolls at $3.50 until 2018.
Had the Silver Line not received the federal loans as well as $300 million in state grants a year ago, toll road users were on track to shoulder more than half — 52 percent — of the line’s costs.
“Obviously, we are working hard with our local partners to reduce the burden,” said Chris Paolino, an MWAA spokesman.
But some commuters are skeptical.
“Tolls are a real cash cow,” said Erik Thompson, 41, who stopped using the toll road about 18 months ago when his tolls hit $70 a month for his commute between Waldorf, Md., and his job as a recruiting manager in Reston.
“I can see the Silver Line from my office, but to use it, I’d have to go end-to-end on Metro and take about two hours. I’m not doing that,” Thompson said.
The loans and state grant enable MWAA to improve its financial planning, former MWAA board member Robert Brown said, and laying out a multiyear toll rate “also takes the political heat off the agency for now.”
The new money also keeps a vital project on track, said former Virginia congressman Tom Davis (R). “Twenty-five years from now, we’ll be grateful we did this,” he said. “Given the growth rates [in the region], we had to do this. It doesn’t get cheaper if you put it off.”
But the pledge to freeze tolls increases pressure to hold down costs as the second phase — which will be built by Bethesda-based Clark Construction — takes shape.
There is no federal funding pledged for the second phase, and even area lawmakers are reluctant to chase more.
“It really has gone way beyond what we have a right to expect in any more help. . . . Frankly, I’d be embarrassed to go up and ask for any more,” said Moran, the Virginia congressman.
Bills from the project’s first phase will continue to come in for about six months, affecting totals. In May, for example, MWAA officials reported that they received a letter from Metro detailing $15.7 million in costs, which included a substantial amount for extended staff costs. The contingency fund that once held $462 million now has $14.6 million.
Those pending bills aren’t final and could lead to haggling, but federal contract monitors in a report on work done through May wrote that changes and potential contractor claims “which will inevitably result” because of the delays remain a “cause for concern” about the contingency.
“We’re expecting to be close to the full budgeted amount for Phase 1, including contingency,” said Paolino, who declined to say whether “close” meant just under or just over the remaining fund.
Before they broke ground, backers scrambled to contain the burgeoning price of the line on at least two occasions.
Federal transit officials demanded cuts and said the airports authority would receive “enhanced oversight” because of its inexperience managing a job the size of the Silver Line project. The extra supervision included having a federal monitor on site.
“We got them approved for a budget that would get them a Volkswagen Jetta, and once they got approved for that they started saying, ‘Why not get a Mercedes since we’re buying a car anyway?’ ” said Robert Jamison, a former deputy director of the Federal Transit Administration.
While the airports authority has gained experience building a transit line, it still shows some weakness in managing costs and holding to timetables, factors that could affect the second phase.
Federal officials concluded this year that the authority wasn’t closely tracking how grant money was being used, demanded more detailed invoices and halted MWAA’s ability to automatically draw down on federal funds.
The second phase of the Silver Line already has felt financial swings.
Bids to design and build that portion came in about $500 million less than expected, and bids to build a rail yard and maintenance facility came in $7 million to $27 million below estimates.
The savings, however, might be offset by other increases. According to a report to the MWAA board in May, costs grew $20 million because of an increase in the price of building materials such as steel and concrete.
Only a few months after preliminary construction began on the second phase, airports authority managers also have tapped a $551.5 million contingency fund for $700,000 to cover a change in storm-water treatment required by the state.
The change is not uncommon on a project so large that is built over a number of years, MWAA spokeswoman Marcia McAllister said.
Unlike the first phase, in which the state of Virginia drove the original no-bid contract, MWAA officials sought bids and controlled the contracting process for the second phase — awarding the job in May 2013 to Clark Construction, the low bidder among five.
As the rail line moves into Loudoun County, attention focuses again on the funding deals that Loudoun and Fairfax reached.
Loudoun agreed to pay 4.8 percent of total costs and Fairfax 16.1 percent, and the counties set up special taxing districts close to the Silver Line’s path to cover that commitment. The airports authority committed to using funds paid from airline passenger fees and taxes to cover its commitment to 4.1 percent of total costs.
Loudoun County’s chief financial officer, Ben Mays, estimates that Loudoun’s percentage of Silver Line costs will amount to $275 million and said the county has appropriated $300 million to give itself a cushion.
The special taxing district would be the primary source for covering overruns, Mays said, and if need be, the county could use general revenue that it anticipates will flow from business sparked by the line.
In Fairfax, the bulk of the county’s Silver Line costs are expected to be covered by two special tax districts. If extra funds needed, the county would tap money from a commercial and industrial tax where revenues must be used for transportation-related projects, said Brian Worthy, a county spokesman.
McAllister said the airports authority now will have more control over costs, including how to pay for improvements, such as station finishes, that one partner in the transit line wants but aren’t part of the main project.
The airports authority also will set and maintain “realistic schedules,” McAllister said.
As far back as 2011, a federal official discouraged the then-head of MWAA from making inflated promises only to dash public expectations.
“It will be clear to anyone driving by the Silver Line that the construction is complete in 2013,” then-interim MWAA president Lynn Hampton said in a 2011 e-mail to Peter Rogoff, head of the Federal Transit Administration.
In his replies, Rogoff noted that MWAA’s own risk assessment had said it was unlikely the line would be ready before 2014, and he cautioned that announcing unrealistic deadlines will “further undermine confidence and anger both passengers and toll payers.”
After originally saying it expected to finish in late 2013, MWAA needed an additional seven months before it could hand off the project to Metro for testing and training, which started in May.
“This was no picnic,” said Davis, who was a board member of the airports authority and dubbed the final frenetic push to open the line a “soap opera.”
A July 26 opening could ease some bickering.
“There have been twists and turns and controversy on the way to this point and I suspect there will be controversy on Phase 2,” Kaine said. But when the line is completed and its economic development impact hits, he said, “It will be really transformative and will justify the twists and turns.”
But holding down tolls to reach that finish will take resolve, said state Del. David A. LaRock (R-Loudoun), who has opposed the growing reliance on tolls and supported the low-interest federal loans. “The Silver Line has been put on their backs,” LaRock said of toll road users.
“2018 is not that far out,” he said, “and in the meantime, we will help them remember the promises they’re making on freezing rates.”