ALBANY Will 2015 be the year of higher tolls on the New York Thruway?
The Thruway estimates it could face a whopping $305 million revenue shortfall by 2018, meaning the system could need to raise tolls on the 570-mile thoroughfare and the new Tappan Zee Bridge to close the deficit, budget documents show.
The Thruway Authority has quietly released its proposed budget for the fiscal year that starts Jan. 1, and the financial data suggests that tolls could grow by as much as 5 percent in 2015 and by as much as 44 percent by 2018.
And it could mean tolls on the new Tappan Zee Bridge could skyrocket from the current $5 roundtrip to as much as $16 roundtrip, the budget documents suggest. The $3.9 billion bridge, owned by the Thruway, is set to open in 2018.
“It’s obvious that there is going to have been some movement in tolls on the Thruway. The question is who pays, how much, how soon,” said E.J. McMahon, president of the Empire Center for New York Policy, who analyzed the documents.
McMahon pointed to a consultant’s report as part of the Thruway’s budget proposal that predicted revenue from Thruway tolls would hit $687 million by 2018. But the Thruway estimated it needs $992 million from tolls in 2018 to cover operating expenses – mainly for the construction of the new bridge.
The budget documents showed that the new bridge would incur a debt payment of about $281 million in 2018 – about 92 percent of the budget gap that year, he said.
For the rest of the system, the Thruway “needs very little,” McMahon said. It’s the new bridge driving the budget problem because the Thruway expects to limit its operating expenses to about 11 percent total over the next five years, the agency estimated.
So McMahon estimated that if bridge tolls solely funded the Thruway’s revenue gap, tolls could hit nearly $16 roundtrip. In 2012, Gov. Andrew Cuomo penned a letter to the state Thruway Authority, saying a projected $14 toll was “too high.”
The Thruway has contended that the Thruway itself won’t subsidize the new bridge between Westchester and Rockland counties. But Thruway officials have not detailed what the new tolls would be on the bridge or how it will be funded. The bridge is about 25 percent built, and the state has so far secured a federal loan for $1.6 billion.
One option would be to use some of a $5 billion windfall from bank settlements the state is receiving this year to help offset the tolls on the Thruway and the bridge. The Thruway has few options to raise money: about 90 percent of its revenue comes from tolls.
Another option would be to take the state’s canal system off the Thruway’s books, which is estimated to cost about $100 million annually to operate in the coming years. Some lawmakers have proposed folding the canals into the state parks department, or perhaps the state transportation department, as part of the state’s overall $137 billion budget.
There was no immediate comment Wednesday from the Thruway Authority on its budget estimates. The Thruway board is expected to meet Monday.
A toll increase on the new bridge or on the Thruway would be a major battle.
In 2012, opponents successfully beat back a 45 percent toll increase on commercial traffic proposed by the Thruway Authority. A bridge toll increase would sting commuters who use the three-mile span daily over the Hudson River.
Brian Sampson, executive director Empire State Chapter of Associated Builders and Contractors, said higher tolls would ultimately be passed onto consumers because it would increase the cost of goods and services.
“The tollpayers and ultimately the taxpayers are going to bear that burden again,” Sampson said.
Under the current toll rates, a trip on Interstate 90 from downtown Albany to downtown Buffalo costs $13.10 using cash. The Port Authority on Sunday increased the cash tolls on its New York City bridges and tunnels, including the George Washington Bridge, from $13 to $14 roundtrip.
The Thruway’s financial estimates have long predicted that toll increases were inevitable, and the agency has faced pressure from credit agencies to raise new revenue.
An analysis last year by a consultant to the Thruway estimated the highway system’s revenue will be $67 million short of its needs next year under the current toll rates, and it will grow to a $276 million gap by 2017.
© 2014 Gannett News Service, WGRZ