Expanded Use of Tolling a Threat to Trucking, NFI’s Grabell Testifies to Senate Subcommittee

The expanding use of tolls on U.S. roads and significant toll increases are serious threats to the trucking industry and its customers, Steve Grabell, chief financial officer for National Freight Inc., told a Senate subcommittee last week.

“I am deeply concerned about the significant increases in toll costs that have been imposed on NFI and other trucking companies over the past few years,” Grabell, testifying on behalf of American Trucking Associations, said during an April 18 hearing of a subcommittee of the Senate Committee on Commerce, Science and Transportation.

NFI, Cherry, Hill, N.J., bears a “significant toll burden” because it has sizable operations in the Northeast and Mid-Atlantic, Grabell said.

“In 2011 alone, we paid approximately $14 million in tolls,” he said. “Tolls represent the fourth-largest expense category for our trucking fleet, behind the cost of our drivers, trucks and fuel.”

NFI has about 2,000 tractors and 7,000 trailers and ranks No. 24 on the 2011 Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers.

Grabell said NFI passes on 50% to 80% of toll costs to customers, depending on contractual commitments, market conditions and the particular freight lanes.

“These added costs have forced us to reroute our trucks to less-efficient secondary roads, which raises our costs and increases congestion and safety concerns,” Grabell testified. “In addition to the impact increased tolls have on logistics providers, the added costs associated with toll increases filter down to the consumer and affect business decisions regarding hiring and facility location and expansion.”

The hearing, billed as an examination of accountability and oversight in tolling, centered on large toll increases imposed by tolling authorities in New York, New Jersey and Delaware.

Grabell said the planned increases in tolls on the bridges between New York and New Jersey operated by the Port Authority of New York and New Jersey would raise tolls 163% by 2015, to a total of $105 per truck.

That is “nearly three times greater than the country’s next-highest bridge toll,” he said.

The authority raised tolls for cars and trucks in August, with further increases graduated through 2015. The current cost of a 5-axle truck to cross a Port Authority bridge using an E-ZPass is $45 during off-peak hours and $50 during peak hours.

Including other toll increases in the Northeast, by 2015 a trip from Baltimore to New York City will cost a 5-axle truck more than $209 in tolls, Grabell said.

He also complained that a state audit revealed that the Delaware River Port Authority had “violated many of its own policies and procedures” over the past decade, including using $440 million for economic development funds “at the expense of critical bridge maintenance and improvement projects.”

“We believe that these toll facilities must be subject to federal oversight, and the statutory just and reasonable toll rate standard that has been in effect for nearly a century must be applied to toll facilities that serve interstate traffic,” Grabell said.

Two other committee witnesses, Chris Plaushin, a vice president for the American Automobile Association, and Eugene Conti, secretary of the North Carolina Department of Transportation, echoed Grabell’s concerns that the tolling authorities had misspent expenditures.

However, Conti, who testified on behalf of the American Association of Highway and Transportation Officials, said that all levels of government are facing a trend toward flattening or declining transportation infrastructure improvement revenue at a time of increasing investment needs.

Tolling is one of the “proven tools” to plug a gap in revenue, Conti said.

Plaushin said that, as a general principle, AAA opposes tolling existing capacity, but tolling new capacity is among the future solutions necessary to increase capacity and manage congestion.

“However, tolls are not the panacea proponents often try to paint them to be,” Plaushin said.

In a contentious question-and-answer session following the testimony, the subcommittee chairman, Sen. Frank Lautenberg (D-N.J.), pressed witness Bill Baroni, deputy executive director of the Port Authority of New York and New Jersey, over whether it was fair for a commuter to pay $12 to cross the Hudson River on one of the authority’s bridges.

Baroni responded that the toll is fair, noting that 81% of the authority’s traffic is paid with electronic toll passes that offer reduced prices.

Baroni added that he didn’t believe Lautenberg was in a position to judge price fairness because, as a former commissioner at the authority, Lautenberg and other commissioners and retired commissioners received free passage crossing port authority bridges.

Baroni said Lautenberg took 284 free trips over authority bridges in the two years before the practice of granting free passes ended in 2006. Lautenberg was a commissioner from 1978 to 1982, according to port authority records.

“Respectfully, Senator, you only started paying tolls recently,” Baroni said.

In a statement following the hearing, Lautenberg expressed his displeasure with Baroni’s “impertinent” testimony.