HOT Lanes on I-77
Widen I-77
March 3, 2015
The Purpose of P3 Legislation
Problem: Congested roads. Limited funding. A Solution: Tolls.
Source: I-77 Mobility Partners Brief in Favor of Motion to Strike and In Opposition to
Preliminary Injunction, p17.
I-77 Corridor is Heavily Congested
“Plaintiff does not dispute the facts that
I-77 suffers from severe traffic
congestion or that increased lane
capacity is needed to improve mobility in
the Project Area.”
--- I-77 Mobility Partners Brief in Favor of Motion to
Strike and In Opposition to Preliminary Injunction, p3
(emphasis added)
Stantec Memos
NB Afternoon Commute- Oct 2011
Segment Travel Speed (mph)
Huntersville
Cornelius
Davidson
Mooresville
Charlotte
Source: I-77 HOT Lanes Technical Memorandum #1, p. 11, Stantec, Mar 8, 2012
SB Morning Commute- Oct 2011
Mooresville
Cornelius
Huntersville
Segment Travel Speed (mph)
Davidson
Huntersville
Cornelius
Charlotte
Source: I-77 HOT Lanes Technical Memorandum #1, p. 11, Stantec, Mar 8, 2012
The Problem
Congested stretch of
four lane road from
~mm21 to exit 36
“In both the Northbound and Southbound
directions, congestion is attributable to high
demand for the two-lane sections of I-77.”
Source: I-77 HOT Lanes Technical Memorandum #1,
Stantec, Mar 8, 2012; p.11.
A Solution
Add a general purpose lane
in both directions
• 13 miles
• $80- 130M (est)
Source: “I-77 Feasibility Study,” Parsons Brinkerhoff, December 7, 2009
The Current HOT Lane Solution
Privately Operated
Toll Lanes
• 27.5 Miles
• $655 M
Source: NCDOT Press Release, April 11, 2014
Difference
General Purpose
Lanes
 ~13miles
 ~$100 million
(All taxpayer funds)
 2-4 lanes
 Able to expand
Toll Lanes
27.5miles
$655 million
($118M taxpayer funds)
All of RoW
U.R.I.F.
No improvements for 50 years
Why the difference?
Majority of
travel time
savings
Majority of
Cost
Source: RFP
The Cost Of Toll Lanes
Source: I-77 JLTCO Report, 4-25-14, WI77 analysis
Taxpayer Obligation
 Taxpayer Contribution
$88M
 For private tolling lanes
 Taxpayer Bonus Allocation
$30M
 For improving private toll lanes
Capital Contribution:
 Taxpayer Subsidy
$118M
$75M
 To cover potential revenue shortfalls
Taxpayer Exposure:
$193M
Private Project Likely Costs Taxpayer More Than Public Project
Source: I-77 JLTCO Report, 4-25-14; CRTPO Meeting Agenda, Feb 18, 2015
How the HOT Lanes Work
 Built and operated under an exclusive
50 year contract
 Vehicles with 3+ occupants use lane
for free
 Electronic Tolling- no toll booths
 Guaranteed minimum speed
 No limit on tolls
 “Congestion pricing”
 More congestion in “free” lanes = higher
price to use toll lanes
Business Model Ensures Congestion
Toll project ensures congestion- 1
 “One inherent but sobering assumption in all this is that
the GP lanes (in any project) are/were congested and for
the most part, would remain congested, for this is
why the justification for an express lane exists in the
first place. No one wants congestion in the GP lanes. So
the express lane provides an option, not a full solution.
Indeed, if congestion in the GP lanes ever
dissolves, than (sic) the incentive to use an express
lane would dissolve too.”
Neil Spiller
Program Manager, Access Management
FHWA Office of Operations- Office of Travel Management
email communication approved by FHWA Public Affairs Office,
Feb 4, 2013 (emphasis added)
Toll project ensures congestion- 2
 “The analysis included in the (toll project)
indicated modest improvements to average
travel speed (all vehicles) and person trips
processed with minimal impact to the
travel speed in the existing general
purpose lanes.”
-- MUMPO TCC I-77 Task Force Meeting August 8, 2012 RFP
Issues memo, August 13, 2012
Bill Coxe, Chair, Technical Coordinating Committee,
Mecklenburg-Union Metropolitan Planning Organization
Toll project ensures congestion - 3
Average Commute Time In GP Lanes- Charlotte to Mooresville
2015
2035
Difference
AM Commute
(Minutes)
39.4
71.6
32.3
PM Commute
(Minutes)
41.5
69.3
27.8
Total
(Minutes)
80.9
140.9
60.0
Commute Time Lengthens By An Hour per Day
Source: I-77 HOT Lanes Technical Memorandum #6, Stantec, Sept 4, 2012
Toll project ensures congestion- 4
“A result of increasing tolls with the
objective of maximizing revenue is that the
HOT lanes would operate under a condition
where their utilization would be well below
capacity thus by definition, not providing
the maximum congestion relief in the
corridor.”
Source: I-77 HOT Lanes Technical Memorandum #4, p 12,
Stantec, May 21, 2012 (emphasis added)
Private Toll Lanes Are Not a Solution for I-77
Project Purpose
“2.2 Summary of Project Purpose
The purpose of the proposed action is to
provide immediate travel time
reliability along I-77 from Uptown
Charlotte to the Lake Norman area.
Because the project is designed to
address an immediate need, the opening
and design years are both proposed for
2017.” (emphasis added)
I am unable to find “travel time reliability” in any NCGS
Toll Rates 2015
$20 Round Trip When Toll Lanes Open (2011 dollars)
Source: I-77 HOT Lanes Technical Memorandum #6, Stantec, Sept 4, 2012
Toll Rates 2035
$40 Round Trip In Twenty Years (2011 dollars)
Source: I-77 HOT Lanes Technical Memorandum #6, Stantec, Sept 4, 2012
Total Toll Revenue (50 Yrs)
$13,688,380,000
Or
$91,250
for every LKN resident
Source: I-77 HOT Lanes Technical Memorandum #7, Stantec, Sept 5, 2012
Debt Service & Operating Expense
$70.0
TIFIA Principal
$60.0
TIFIA Interest
PAB Principal
$50.0
PAB Interest
CA 91
Millions
Operating Expense
$40.0
$30.0
I-95 MIA
$20.0
HOU, DEN, MSP, SAN + 6 OTHERS
$10.0
$2015
2020
2025
2030
2035
2040
Historically high tolls required from second smallest metro area
Source: Financial Plan, (Comprehensive Agreement),Cintra, June 26, 2014; WI77 Analysis; “Managed
Lane Pricing Guide”, FHWA, 2012
A New Funding Paradigm: STI
 Passed summer 2013
 HB 817
 Replaces Equity Formula
 More data-driven
 Using objective criteria
The Legislature has determined
congestion mitigation is a priority
 GS 136-189.11.1 Transportation Investment
Strategy Formula
The P3 Toll Project Fails This Priority
NCDOT STI Scores for Hypothetical I77 GP Projects
Source: “STI & I-77” press release, NCDOT, July 24, 2014
How Does This Rank Against Other Statewide Projects?
Highest
scoring funded
project
 I77 GP Project
 I77 GP Project
73
“Statewide”
funded
projects
 I77 GP Project
 I77 GP Project
Lowest I77
scores
higher than
25 funded
projects
Projects to be funded
Lowest scoring
funded project
377 Unfunded Projects
Projects unfunded
I-77 GP project
through Lake
Norman
Source: STI 9-24-14 STI 3.0 Total Score
A General Purpose Lane Project Would Likely Be Funded Under STI…
Short time to wait for answer
 “Under the STI law all projects that were
projected for construction after July 1,
2015 are subject to scoring under the new
funding formula.”
 “Because the I-77 North Managed Lanes
(North of I-277) project is scheduled to
begin construction before July 1, 2015 it is
not subject to the new law and was not
scored under STI.”
NCDOT has discussed tolling I-77 since 2007.
Source: “STI & I-77” press release, NCDOT, July 24, 2014
Conclusions
 The I-77 HOT Lane Project
 Does not solve the congestion problem
 Burdens middle and low income commuters with high
tolls or excessive, increasing congestion- it’s a rich
man’s road
 Siphons $13.6B out of our local economy
 Essentially eliminates the possibility of improvements
for 50 years
 Involves substantial taxpayer obligation for a private
project from which a private company will profit
 Costs the taxpayer more than a public project
 Carries significant risk of default
 Does not serve the public interest
50 years of tolling can wait another four months.
In Summary
The private toll lane
project does not serve
the public interest
It does not alleviate
congestion… it ensures
it.
50 years of tolling can wait another four months.
STI Corridor Cap
 “No more than 10% (or about $200 million) may be
assigned to any one project or group of projects within
the same corridor during a five year period.”
 …”I-77 South projects would out score, and use all of the
corridor funds available for at least the next ten
years….”
 “Right of way purchase for the I-77 South projects
begin in 2024, with actual construction still further
out.”
Rather than a 10 year wait, we have a 9 year window to widen I-77
Source: “STI & I-77” press release, NCDOT, July 24, 2014