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10 the costs of administering the motor fuel tax could exceed collecting and administering motor fuel taxes, expenses of $10 million annually (Jones, 1995). inspecting motor fuel, and other costs or deductions by the col- The literature suggests that while it is expensive to effectively lecting agencies. audit and enforce motor fuel tax codes, enhanced compliance activities yield positive returns on investment. From October 2.2 Tolling 1992 through 1993, gasoline tax revenues reported in 38 states averaged $443 per auditor staff hour. Over the same time This section summarizes the current practices and future period, diesel tax revenues were enhanced at the rate of $321 per trends that will affect toll-collection activities. Due to the long auditing hour (CSG & CGPA, 1996). Finally, FHWA reports history and widespread use of tolling in the United States, this that it receives $10 to $20 for each dollar spent on audits and section provides an overview from an extensive body of litera- criminal prosecutions (FHWA, 1999). ture on toll systems, management practices, governance frame- works, system configurations, and pricing policies. 2.1.2 Previous Administrative Cost Estimates 2.2.1 Overview of Tolling Systems and Current Practices Historically, relatively few studies have attempted to esti- mate the administrative costs associated with motor fuel tax Toll roads have been in existence since the early days of the collection, and while study findings have varied, results indi- United States. The first toll road in the United States was the cate that motor fuel administrative costs are likely less than 1% PhiladelphiaLancaster Turnpike, which was developed in of gross collections minus deductions for distributor collection the 1790s. Throughout the 1800s, a number of turnpikes were allowances, refunds, and other allowances for handling losses established in the United States. The first modern toll road with and evaporation. a toll-road agency was the Pennsylvania Turnpike, which In 1994, NCHRP Report 377: Alternatives to Motor Fuel opened in 1940. This was followed by additional tolled turn- Taxes for Financing Surface Transportation Improvements esti- pikes in Connecticut, Delaware, Florida, Illinois, Indiana, mated motor fuel administrative costs at $200 million for all Kansas, Maine, Maryland, Massachusetts, New York, New states (Reno and Stowers, 1994). In 1993, when this research Jersey, New Hampshire, Ohio, and Oklahoma. These roads was performed, net receipts from state motor fuel taxes totaled were managed, administered, operated, and maintained by the roughly $24.9 billion (FHWA, 1994b). Using net collections state highway agency and/or a dedicated toll-road agency that as the denominator to the administrative cost numerator, the reported to the state government. Although there are some aforementioned cost estimate presented in this publication exceptions, these facilities have historically been categorized represented 0.8% of total tax collections. by relatively high labor costs, reduced operational and main- In 1995, in response to a proposal to eliminate Oregon's tenance expenditures, and cash collection at tollbooths. More- weight-distance tax and replace it with a tax on diesel, ODOT over, these agencies are often constrained either politically compared the administrative costs of the proposed system to and/or legally from increasing toll rates on a timely basis to that of the existing one. ODOT found that despite a reduction cover increases in costs. of 20 FTEs and a cost reduction of $1.4 million associated with The next important development with regard to the devel- the registration and reporting of tax records by out-of-state opment and administration of toll roads involved the cre- operators, net administrative costs would grow under the ation of local toll-road agencies [e.g., the Harris County motor fuel tax due to the expanded workload associated with Toll Road Authority (HCTRA) in Houston, Texas, and the IFTA audits (3 FTEs, $250,000) and an expanded refund pro- OrlandoOrange County Expressway Authority in Orlando, gram (15 FTEs, $1.3 million). Assuming that the proposed Florida]. Moreover, a number of bridges and causeways motor fuel tax program would have been revenue neutral with have been developed and managed by city, county, and respect to the weight-distance tax system it was designed to regional government agencies. The advantage of this approach replace, estimated administrative costs would have been in the is that revenues generated by the toll road system, which are 4.5 to 5% range (Jones, 1995). drawn primarily from commuters, are plowed back into the The costs to administer motor fuel tax programs have ranged local economy rather than being dispersed over a wide geo- in recent years from 0.2% (Peters and Kramer, 2003) to 1.0% graphic area. (HDR, 2009). The higher-end estimate was presented in an Finally, a growing number of toll facilities are operated by HDR report prepared for the U.S. Department of Transporta- private entities under concession agreement. Private financing tion and was based on data reported by states in Form 556 to has been used for asset monetizations as well as for the devel- FHWA for presentation in Highway Statistics. This estimate opment of new toll road facilities. Table 2 lists the roughly includes all deductions by state collection agencies, expenses of 90 toll agencies in the United States and Canada.
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11 Table 2. State, local, and private toll agencies. Mature Local & Regional Toll- Maturing and Ramp-Up Public Mature State Agencies Private Toll-Road Agencies Road Agencies Toll-Road Agencies Alligator Alley (FL) Bay Area (CA) Toll Authority, Alamo Regional Mobility Authority Adams Avenue Turnpike, California (TX) LLC (UT) Caltrans (CA) Blue Water Bridge Authority Bay Area Toll Authority (CA) Ambassador Bridge DelDOT (DE) Buffalo and Fort Erie Public Bridge Cameron County Regional B&P Bridge Company (TX) Authority Mobility Authority (CCRMA) (TX) Florida's Turnpike Enterprise Cameron County (TX) Camino Real Regional Mobility Brownsville and Matamoros (FTE) Authority (CRRMA) (TX) Bridge Co. (TX) Georgia State Road and Tollway Cape May County Bridge Central Texas Regional Mobility Chicago Skyway Authority (SRTA) Commission (NJ) Authority (CTRMA) Illinois State Toll Highway City of Del Rio (TX) Connector 2000 Association Inc., Dulles Greenway Authority (ISHTA) (SC) Kansas Turnpike Authority (KTA) City of El Paso (TX) Eagle Pass (TX) Bridge Foley Beach (AL) Express Louisiana Department of City of Pharr (Pharr-Reynosa Foothill/Eastern (CA) Indiana Toll Road (ITR) Transportation & Development Bridge) Transportation Corridor Agency Maine Turnpike Authority Chesapeake Bay (VA) Bridge and Grayson County (TX) Regional I-495 HOT lanes, Virginia Tunnel Mobility Authority (GCRMA) Maryland Transportation Delaware River and Bay Authority Hidalgo County Regional Mobility Northwest Parkway Public Authority (MdTA) (DRBA) Authority Authority (CO) Michigan Department of Delaware River Joint Toll Bridge Lake of the Ozarks Community Pocahontas Parkway Transportation (MDOT) Commission (DRJTBC) Bridge (MO) Association (VA) New Hampshire Turnpike Delaware River Port Authority McAllen (TX) International Toll South Bay Expressway (CA) (DRPA) Bridge, Texas New Jersey Turnpike Authority E-470 Public Highway Authority Metropolitan Washington Airports Starr Camargo Bridge (NJTA) (CO) Authority (MWAA) Company New York State Thruway Galveston County (TX) Minnesota Department of Toronto 407 Intl Inc. Authority (NYSTA) Transportation (Mn/DOT) New York State Bridge Authority Golden Gate Bridge, Highway and North Carolina Turnpike Authority United Toll Systems (AL) Transportation District (CA) (NCTA) Oklahoma Turnpike Authority Greater New Orleans Expressway North East Texas Regional (OTA) Commission (GNEOC) Mobility Authority (NETRMA) Ohio Turnpike Commission Harris County (TX) Toll Road North West Arkansas Regional (OTC) Authority (HCTRA) Mobility Authority Pennsylvania Turnpike Lee County (FL) Orange County (CA) Commission Transportation Authority (OCTA) Pinellas Bayway (FL) Massport (MA) Osceola County (FL) Rhode Island Turnpike and Metropolitan Transportation Authority San Diego Association of Bridge Authority (RITBA) (MTA) Bridges & Tunnels Governments (SANDAG) South Carolina Department of Miami-Dade Expressway System San Joaquin Hills Transportation Transportation (SCDOT) (MDX) Corridor Authority (SJTCA) Sunshine Skyway Bridge (FL) Mid-Bay Bridge Authority (MBBA) Santa Rosa (FL) Bay Bridge Authority West Virginia Parkways Authority Niagara Falls Bridge Commission Sulphur River Regional Mobility Authority (TX) North Texas Tollway Authority (NTTA) Texas Turnpike Authority (TTA) OrlandoOrange County Expressway Utah Department of Authority (OOCEA) Transportation Port Authority of New York and New Washington Department of Jersey (PANY/NJ) Transportation (WSDOT) Richmond Metropolitan Authority (VA) South Jersey (NJ) Trans. Authority Starr County (TX) Tampa (FL) Hillsborough Expressway Authority Source: Jacobs Engineering Group, 2010