The chief financial officer for Cherry Hill, NJ-based National Freight Inc. (NFI) warned a Senate committee that rapidly increasing and excessive highway tolls are a threat to both consumers and the trucking industry and called for Congressional oversight of tolling authorities that serve interstate traffic.
Stating that his trucking company paid $14 million in tolls in 2011 alone, NFI’s Steve Grabell pointed to the planned increases in tolls on the bridges between New York and New Jersey that raise tolls 163% by 2015 as an example of the impact of excessive tolls and a toll authority that requires Congressional intervention.
Grabell was testifying on behalf of the American Trucking Assns. before the Senate Commerce, Science and Transportation Committee’s Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety and Security on Wednesday.
The trucking industry is “very concerned about the irresponsible behavior of some tolling authorities which, along with complicit state officials, seemingly view toll revenue as a slush fund for investment in all manner of projects, programs and activities which have nothing to do with maintaining their highways, bridges and tunnels,” Grabell told the committee. “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.”
Federal enforcement authority over tolling agencies, “whether through judicial review, executive branch oversight, or a combination of the two, must be restored,” Grabell told the committee. “Absent such action, consumers and businesses will be compromised by unfair costs and a highway system that is less efficient and less safe.”
Grabell urged the committee to support the Commuter Protection Act, introduced by Committee Chairman Sen. Frank Lautenberg (D-N.J. to provide federal oversight for toll authorities, citing the Port Authority of New York and New Jersey and the Delaware River Port Authority as examples of where federal intervention is needed.
He pointed out that the planned increases in tolls on the bridges between New York and New Jersey will make tolls there “nearly three times greater than the country’s next highest bridge toll,” adding that it “appears the vast majority of the revenue … will be used to benefit seaports and airports and to complete the reconstruction of the World Trade Center office buildings.”
Grabell cited a Jan. 31, 2012, audit report of the PANYNJ that found “a challenged and dysfunctional organization suffering from a lack of consistent leadership, a siloed underlying bureaucracy, poorly coordinated capital planning processes, insufficient cost controls, and a lack of transparent and effective oversight of the World Trade Center (the “WTC”) program that has obscured full awareness of billions of dollars in exposure to the Port Authority.”
The report found that the PANYNJ had accumulated debt of $19.5 billion by the end of 2011, which is projected to rise to $20.8 billion by the end of 2012.
“In order to fund a 10-year, $25.1 billion capital plan, in 2011 the PANYNJ announced a massive toll rate increase on the six interstate bridges and tunnels between New York and New Jersey. The result for NFI and other truckers is that we will absorb a disproportionate amount of the toll increase for a period of time,” Grabell said.
The trucking executive added that public hearings on the proposed toll increases were “frankly just window dressing. The way in which the whole process was conducted sent a very clear message that the decision to increase tolls had already been made, without regard to public input,” he said. “The process and the outcome points to an Authority with unchecked power that shows little regard for the impacts of its decisions on the community which it purports to serve.”
Meanwhile, according to a state audit, the Delaware River Port Authority has “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,” Grabell said.
“We have witnessed a disturbing trend among some tolling authorities. Operating independently, or with the support of, or benign neglect from, state officials, these authorities seem to view their control over the distribution of toll revenue as an opportunity for personal enrichment or accumulation of power,” Grabell said. “Without federal oversight, such abuses may never be uncovered and will not be curtailed.”
“Congress has an obligation under the Constitution’s Commerce Clause to ensure that interstate travelers, who may not be represented when toll rate setting and spending decisions are made, have a voice in these processes,” Grabell said, adding that ATA believes the Commuter Protection Act “is a significant step toward ensuring better oversight of tolling authorities that serve interstate traffic.”
Excessive tolls, Grabell said, also force business decisions that could have long-term impact on the entire economy. The added costs of tolls have forced NFI to re-route trucks to less efficient secondary roads, “which raises our costs and increases congestion and safety concerns,” he said.
“Our customers, ultimately, bear much of the costs of tolls, and of course, they attempt to pass the costs on to their customers, which eventually filter through to the consumer of the product,” Grabell said. “This impacts the customers' cost of doing business and creates additional uncertainty regarding these companies’ ability to continue to operate in the Northeastern part of the U.S. and other areas of the country that impose tolls on major freight routes.”