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75 · Finance, accounting, and audit activities, especially if they istrative costs per transaction with $0.02, and the Dulles Green- involve the processing of (i) customer transactions; (ii) the way had the highest estimated administrative costs per trans- settlement of interagency transactions--defined as drivers action at $0.34. As a percent of revenues, OOCEA had the with interoperable transponders who incur toll transac- lowest administrative costs (2.9%) and DRPA the highest tions on other toll-road systems; (iii) the processing of bulk (13.9%). Figure 39 summarizes administrative costs by toll- transactions from rental car companies, local delivery road agency in 2007. trucks, and auto dealers; and (iv) the exclusion of transac- tions by non-revenue vehicles (e.g., police, ambulance, and 4.3.6 Collection Costs fire vehicles). Some agencies may also exclude city buses and government vehicles. Toll-collection costs include the following components: · Management and professional services. · Procurement and purchasing of toll equipment and · Operation and maintenance of tollbooths; transponders. · Operation and maintenance of ETC and video tolling sys- · Office supplies and equipment. tems as well as related information technology hardware · Planning activities related to toll-system development and and software; expansion. · Customer account management, payment processing, and · Buildings, utilities, and insurance for tollbooths and cus- banking charges relating to toll accounts; tomer service. · Inventory, distribution, and sale of transponders; and · Cash counting, transportation, and vault services. Depreciation, amortization, interest expense, and the current portion of debt obligations were excluded from this Toll-collection costs for the 15 agencies included in this analysis. For toll agencies, these cost factors are more typically analysis averaged $0.36 per transaction and 25.8% of total costs associated with capacity expansions, major rehabilitations, in 2007. Toll-collection costs for the privately operated, all- and maintenance activities. As a result, these cost factors have ETC Toronto 407 were 11.0% of revenues and $0.43 per trans- been excluded from this analysis. action. In comparison, toll-collection costs for NYSTA, a state For the 13 agencies for which data were available, adminis- agency with cash and ETC lanes, were 16.1% of revenues trative costs averaged approximately 7.7% of toll revenues and and $0.34 per transaction. Moreover, ISTHA recorded toll- $0.14 per transaction in 2007. OOCEA had the lowest admin- collection costs of 19.2% of revenues and $0.14 per transaction. 16.0% $0.40 14.0% $0.35 12.0% $0.30 Per Transaction 10.0% $0.25 % of Revenues 8.0% $0.20 6.0% $0.15 4.0% $0.10 2.0% $0.05 0.0% $0.00 % Revenue $/Transaction Source: Jacobs Engineering Group, 2010 Figure 39. Administrative costs by toll agency, 2007.
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76 100.0% $1.20 90.0% $1.00 80.0% 70.0% $0.80 60.0% 50.0% $0.60 40.0% $0.40 30.0% 20.0% $0.20 10.0% 0.0% $0.00 % Revenue $/Transaction Source: Jacobs Engineering Group, 2010 Figure 40. Toll-collection costs by toll agency, 2007. Toll-collection activities were estimated to be $0.09 per trans- In general, toll agencies are reluctant to publicize leakage action for NTTA, which was the lowest of the agencies exam- rates because high leakage rates tend to be viewed negatively ined. At the other end of the spectrum, OTC had toll-collection by bondholders and shareholders. Moreover, toll agencies are costs of approximately $0.98 per transaction. Toll-collection concerned that public disclosure of a high leakage rate on costs accounted for 92.6% of revenues for the I-15 HOT lanes their respective toll facilities may also discourage users from in San Diego. This may be a function of relatively lower rev- paying tolls. Within the industry, toll leakage typically ranges enues generated for the I-15 lanes since this facility was prima- from 5% to 10%. Table 25 provides an estimate of toll leak- rily developed to support congestion management objectives. age rates for toll systems in Texas, Colorado, California, Figure 40 summarizes toll-collection costs by agency. Florida, Illinois, and New Jersey in 2006 and 2008. The pay- ment of administrative fees and fines may result in a zero or even negative leakage rate (where the amount of revenues Leakage collected is greater than the amount of revenues owed) for a To improve collections, toll agencies actively attempt to single year. reduce leakage. Minimizing leakage is particularly difficult on The increase in leakage rates estimated for ISTHA and open-road facilities since there are more opportunities for SR-91 highlight the following issues: (i) leakage rates are par- violators to avoid payment. To reduce opportunities for leak- tially determined by the accounting definition of leakage (e.g. age, toll agencies have installed video-billing systems. Video doubtful accounts, net violations), which can include unpaid billing involves taking an image of all vehicle license plates tolls as well as violation fees, and (ii) increased enforcement and mailing drivers without a valid transponder or with insuf- efforts may paradoxically result in higher leakage rates. For ficient balances in their accounts a bill of toll activity. These example, ISTHA increased its enforcements efforts, result- systems involve capital expenditures related to video-billing ing in an increase in revenues from toll evasion recovery of equipment as well as account review by customer representa- $29 million in 2007 to $224 million in 2008. However, ISTHA tives to ensure accuracy of the bill statements that are mailed still had $146 million in allowance for doubtful accounts on its to toll-road users. balance sheet. A large percentage of this amount consists of