A Permanent Temporary Source of Funding

By John Carr, NMA Massachusetts Activist

“You never want a serious crisis to go to waste.” — Rahm Emanuel

A reporter found the next manufactured crisis that will allow Massachusetts to keep collecting Turnpike tolls more than 30 years after the road was supposed to become free.

Like many toll roads, the Massachusetts Turnpike was built in the 1950s by borrowing money to be repaid by collecting tolls for 30 years. A new quasi-public agency was created to build and operate the Turnpike.

As a transportation project it was a success. Two years after construction started you could drive from Stockbridge to Weston in two hours instead of four. (James Taylor’s Turnpike from Stockbridge to Boston was not completed until 1965.)

The failure was in the financial incentives. An independent authority is a little kingdom full of little kings who can spend money as they please.

The Turnpike Authority spent twice as much money per mile of road as the state DPW and padded its payroll with patronage jobs. When the bonds were paid off the road would become an ordinary state highway with ordinary staffing levels. In the 1980s Turnpike employees were like Cinderella watching the clock tick towards midnight.

Turnpike Authority board members decided they were doing a bad job. Under their leadership the Turnpike had been allowed to decay and millions of dollars of repairs were urgently needed. They borrowed money for repairs and ensured that debt and tolls would remain past the original 30 years.

In the 1990s Massachusetts was working on a $2.6 billion project to replace an elevated highway in Boston with a tunnel. By the late 1990s the fraud started to become public. The price of the Big Dig was shooting past $8 billion and the state was on the hook for all future cost overruns.

Politicians decreed the Big Dig to be part of the Turnpike, making the Turnpike Authority financially responsible. Tolls on the Turnpike would pay for construction, arguably an unconstitutional tax on drivers who didn’t use the Big Dig. Politicians tried and failed to make the Turnpike Authority pay for other free interstates. The end of tolls moved back even farther.

(The Big Dig included several transit projects with separate debt service requirements. While Turnpike drivers pay much more than the combined capital and operating cost of the Turnpike to fund the Big Dig, it’s the threatened increase of transit fares from 40% to 45% of operating costs that is sparking outrage this spring.)

In 2006 there was enough cash on hand to free the Turnpike. Once again board members said their road was in bad shape. It would cost $70 million to bring the Allston interchange up to standards, for example. The sides compromised by having the state DOT take over the Turnpike with tolls and jobs intact.

How will the state keep tolls in place past 2017? The Turnpike has not been spending money on bridge repair. Soon there will be a bridge crisis. The state “doesn’t have the money” to fix these bridges. The state will borrow money to be repaid from tolls, ensuring a revenue stream and job supply through the career of anybody now working.

Massachusetts is not an anomaly. In the Northeast and adjacent states only Connecticut and Kentucky abolished tolls after construction costs were paid off. New York eliminated parkway tolls but expanded the Thruway’s responsibility.

Some tolls were perpetuated by self-serving agencies. Others were perpetuated by outside forces. Politicians found it easier to drop a large tax increase on a small group than a small increase on a large group. Commuters from Boston’s western suburbs pay for the Big Dig (built for north-south traffic) because the toll booths were already there. New York and Pennsylvania politicians looted their toll roads for the same reason. For example, tolls on the Thruway proper pay for a free ride on I-84.

The only recent good news for toll road drivers in the region has been the Ohio Turnpike’s increase in speed limit and reduction in truck tolls. The toll reduction was a rare instance of a toll agency working for the public good (reducing truck traffic on two lane roads) at its own expense.

It is not inevitable that quasi-public agencies will act in their own interests instead of the people’s, but it is more the rule than the exception.

Many funding schemes make sense on paper and fail when implemented by human beings. Repaying construction bonds with tolls is an example. Proponents of new user fees will tell you what can go right. We need to ask, what can go wrong?

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