Even as traffic begins to return to the nation’s highways, toll road travel remains well below normal — down by as much as 40 percent in some markets, according to the International Bridge, Tunnel and Turnpike Association (IBTTA). Some operators fear pre-pandemic travel patterns may be slow to return as the health crisis extends into the fall and more employers embrace telework for the long term.
Even if traffic levels recover, it may take years for operators to recover the lost revenue, some experts said.
“This just happens to be one of the biggest crises that the tolling industry has faced,” IBTTA Executive Director Pat Jones said.
In the Washington region, home to one of the country’s largest toll networks, operators are reporting revenue losses in the hundreds of millions and are forecasting bleak financial outlooks well past 2020.
The Maryland Transportation Authority, which runs the state’s eight toll facilities, last week announced a gloomy financial forecast through 2026, citing a $422 million reduction in toll revenue, partly due to the pandemic.
In Virginia, traffic and revenue were down significantly for all toll facilities, including congestion-based pricing systems on Interstates 66, 95, 395 and 495.
The 66 Express Lanes, managed and operated by the Virginia Department of Transportation, yielded $238,000 in toll revenue in May, down 90 percent from May 2019 when the tolls generated $2.5 million.
The Dulles Toll Road, owned and operated by the Metropolitan Washington Airports Authority, had year-to-date revenue drop to $53.8 million through May, a 33 percent — or $26.8 million — decline compared with the same period last year, according to the authority’s financial statements.
Traffic on the 95, 395 and 495 Express Lanes hit a low in April when it was down by 80 percent, according to toll operator Transurban’s most recent trading update. Through mid-June, average daily traffic was at about 60 percent of pre-pandemic levels.
The company declined to provide revenue data in advance of its semiannual report due in August. Express lane tolls, which fluctuate based on traffic, also remain well below pre-pandemic averages. On the 495 Express Lanes, the average toll was $2.50 in mid-June, down from $5.40 in early March.
But the company says the crisis has not affected its construction projects, and it plans to meet its annual obligation to the state of Virginia of $15 million for regional transit funding, spokesman Michael McGurk said. Transurban’s other operations — in Australia and Montreal — were not as severely affected as in Northern Virginia.
“Transurban is well-positioned for the recovery and is engaging with industry and governments on a pipeline of potential infrastructure projects to support the economy and drive growth,” the company’s financial report said.
Industry leaders have been lobbying Congress to invest in or provide financial incentives for companies to restart toll road construction, saying it would help drive the economic recovery.
IBTTA has sought more than $9 billion in federal relief for the industry, arguing that the losses due to the pandemic could have a “profound impact on agencies that millions of American citizens depend on for mobility and jobs.”
The Pennsylvania Turnpike Commission, for example, said it lost $100 million in revenue for the fiscal year that ended May 31, which necessitated major cuts in capital and operational spending. The commission fast-tracked plans to make its toll facilities cashless and in the process laid off 500 workers, mostly toll collectors.
The crisis also prompted the commission to delay its July payment to the Pennsylvania Department of Transportation to support statewide transportation needs, including mass transit. The commission pays the state $450 million annually and was due to make a $112.5 million payment this month. The funding delay could result in delays or scaling back of some state transportation programs.
In Georgia, tolls paid by motorists traveling on Interstates 75 and 85 in the Atlanta area declined by as much as 90 percent, while revenue dropped by more than $12 million, State Road and Tollway Authority Executive Director Chris Tomlinson said at an industry briefing in late May. The authority is reviewing cost-saving options, including reducing the scope of some capital projects, Tomlinson said.
In Orange County, Calif., where toll transactions and revenue dropped 70 to 80 percent, projects are being deferred, and the Transportation Corridor Agencies is entering next year with an operating and capital budget that is about 51 percent, or $78 million, lower than the current year.
However, some observers say recent upticks in traffic as the country reopens are encouraging. Toll road traffic and revenue are down between 25 and 40 percent across the country, according to the IBTTA, a substantial improvement from April and May when toll facilities were reporting declines ranging from 50 to 90 percent.
More road use is expected as the summer unfolds and Americans turn to road trips for a vacation option. AAA is forecasting Americans will take 700 million trips this summer — 683 million of which are expected to be via car.
However, coronavirus cases in the United States surpassed 2.5 million last week, and many states were experiencing increases in infections, leading to worries that a new round of shutdowns may be coming.
“A month ago, I would have said that we would really be flattening the curve in terms of the number of [coronavirus] cases and that traffic would steadily rise,” said Jones, the IBTTA director. “But with what's happening now in the states in terms of the rise in new cases, it’s hard to predict what’s going to happen to the traffic.”
Losses and delays
In the Washington region, the decline in toll revenue is hurting operations and expansion in some areas.
The Maryland Transportation Authority said it is not funding vacant positions and is deferring the replacement and purchase of additional equipment such as computers. It has saved money by not funding vacant positions and not renewing 44 temporary toll collection contracts; the state moved to an all-electronic system during the pandemic.
On capital projects, the completion of an extension of the 95 Express Lanes is being delayed by one year, officials said.
In total, the toll authority is looking at a loss of $101 million or 14 percent, in fiscal year 2020 and is forecasting a $111 million drop in revenue this fiscal year, or roughly 16 percent compared to the previous forecast.
In Virginia, lost revenue from the 66 Express Lanes means the corridor is unlikely to yield millions of dollars that would help pay for new bus routes and the construction of new Metro station entrances and bus lanes.
As of late June, Virginia transportation officials said toll revenue funding for such projects was nearly $7 million below what was approved in the fiscal 2020 budget, and millions more for local infrastructure were at stake as long as rush-hour traffic continued to be light because of the pandemic.
Tolls from the 66 Express Lanes pay for operation and maintenance of the road, with the remaining money allocated to the Commuter Choice program managed by the Northern Virginia Transportation Commission.
Created in 2017, Commuter Choice uses toll revenue to fund multimodal projects that benefit the area near the toll lanes, with the goal of moving more people and expanding transportation options. The program so far has funded 46 projects and last year was expanded to include the I-395/95 corridor.
The NVTC has delayed awarding funds this summer to more than a dozen projects, including to the construction of a second entrance at the Ballston Metro station in Arlington. Officials said it’s unclear how much of the previously anticipated $25 million in toll revenue would be available to fund this year’s round of projects.
“These amounts . . . assumed there were ample available revenue available,” said Michelle Holland, a spokeswoman for the Virginia Department of Transportation, which operates the 66 Express Lanes.
Arlington transportation chief Dennis Leach said the county is awaiting good news on its application for $10 million to help pay for the $130 million construction of a second entrance at the Ballston Metro station. Although the county does not need the money this year, it hopes to secure funding commitments to proceed toward construction as early as next year. If the toll money doesn’t materialize, he said, the county will have to seek the funding elsewhere.
As of late June, the number of trips on the toll road was around 16,500 daily, well below the normal 32,000 to 35,000.
Jurisdictions and transit agencies that have applied for toll funds to support projects are awaiting word of how much funding will be available this and next year. Another applicant, OmniRide based in Prince William County, sought funding to support three bus routes and a new vanpool program.
“Without the continued Commuter Choice funding for services, OmniRide would have to examine other revenue streams, such as local motor fuels taxes, to determine what levels of services could be provided,” OmniRide spokeswoman Christine Rodrigo said.