Texas No Longer a Trailblazer for P3 Tolling

LM Otero/AP

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More than two years after Texas Republican Gov. Greg Abbott declared a moratorium on toll roads, a new report by a global research firm said the public-private tolling sector continues to decline in the state that was once a trailblazer for toll road P3 projects.

A motorist and voter backlash, and lack of support from the state Legislature, have caused a policy shift from solving road and bridge maintenance and construction needs using P3s.

As Texas began moving away from P3 tolling in 2017, a year later P3s were touted as a potential significant piece of funding the Trump administration’s more than $1 trillion failed infrastructure plan. Although Congress recently has begun laying plans for a new infrastructure plan, it has yet to come up with a funding package.

Abbott

“Residents in Texas objected to having to pay tolls to commute to work when those in the parts of the south had access to free lanes built when the state was better funded,” according to a report released last month by Inframation News. “Voters in 2014 and 2015 gave the green light to the Texas Department of Transportation for more funding after state leaders assured them that the money wouldn’t be used on toll projects.”

As a further indication of a lack of public support, in May 2017 the Legislature rejected a bill that sought approval for 18 P3 transportation projects.

More recently, P3 investors have shifted their focus to social infrastructure projects, such as Texas government buildings and universities, “but deal flow here has been slow to take off,” according to the report.

“The activity you’re seeing now are the projects that were already approved and still moving forward,” said Andrew Vitelli, co-author of the report. “But right now, you’re not seeing P3 projects in transportation because of what is essentially a tolling moratorium. These projects just aren’t being approved.”

The report was the work of Inframation News, a division of Acuris, a global network of more than 50 journalists and analysts who provide infrastructure finance news, analysis, data and events.

One unnamed adviser familiar with the state said public pushback against tolling has been overstated and that Texas residents appreciate having the option of using tolls, the report said.

“The anti-tolling lobby got hold of the initiative towards the end of the [Rick] Perry administration,” the adviser told Inframation News. “If you look at the congestion you’ve got in Texas, it is a massive growth state. I don’t know where they will find the money to do it if they don’t do tolling.”

From 2008 to 2014, Texas, with its sprawling 680,000 total lane miles, was viewed as fertile ground for transportation P3s. During those years, the state saw four P3 deals totaling more than $1 billion, according to the report.

However, some of the projects during that era were not hitting their traffic projections, Vitelli told Transport Topics.

Asked for comment on the report, Texas DOT spokesman Adam Hammons said, “We can’t provide an interview. TxDOT is currently in a non-toll operating environment.”

Esparza

Texas Trucking Association President John Esparza said while he’s not a fan of tolling for trucks, that despite all the complaining by motorists, as soon as the roads are open in some areas they are using them frequently if they can avoid congestion.

“But I think the one thing that is a huge challenge, especially for our industry, is the graduated toll charts,” Esparza told TT. “You’ve got peak-time tolls that are 48 cents a mile, as opposed to 8 cents a mile — something like that. The thing I hear most from our carriers is, ‘This is killing us. We can’t predict the toll price.’ ”

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