Less driving means less income from tolls, which jeopardizes local projects

Add another victim to the list of industries hit hard by the coronavirus pandemic: toll road operators.

The industry’s losses, which by estimates will exceed $9 billion nationwide, are prompting public and private toll operators to tap their reserves, delay capital projects and cut jobs.

No one likes to pay tolls, and that might lead one to ask why they should care that the industry is taking a huge hit. Toll revenue is used to pay for transportation infrastructure, and the steep losses mean local transit and road projects are being put on hold.

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. Some operators fear prepandemic 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 ExecThe utive 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 Washington-area interstates. For example, the Virginia’s 66 Express Lanes yielded $238,000 in toll revenue in May, down 90% from May 2019 when the tolls generated $2.5 million.

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.”

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%, 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%, projects are being deferred and the Transportation Corridor Agencies

is entering next year with an operating and capital budget that is about 51%, 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%.

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 lockdowns 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,” Jones said. “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.”