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Cornelius News

More developments around I-77 Public-private finance plan.

Letter from Vince Winegardner:

As you may know, The TIFIA Credit Council recommended approval for Federal taxpayer backing for $189 million.  It is probable Cintra/I77 Mobility Partners will gain bond market approval for this key bond and the NC DOT will sign the FC before the May 17th deadline.  This final step had been delayed for good reason.

Kurt Naas of Wideni77  did a good job of identifying two major flaws in the I77 Toll Project’s Comprehensive Agreement that the TIFIA Credit Council should have taken into account: (1) the probability of failure due to revenue sharing discrepancies (see attached) and (2) how the widening of secondary roads would reduce demand on the toll roads (e.g. a new study should be done).

How did the NC DOT respond to that challenge?  They removed bonus money from competing roads and put it into the toll roads directly.   This must have been enough to overcome the TIFIA Credit Council concerns? (see Attached TCC presentation and minutes below) .

Several other points about this last minute transfer:

  • How does a direct toll lane access rate higher than an adjoining secondary road on bonus allocation points (7 v 4.6)?
  • How does Charlotte’s CRTPO rep Vi Lyles drop this very significant change on the CRTPO and which was not a TCC recommendation?   It did not have unanimous support and deserved greater debate.
  • Note the importance of the bonus allocation decision  to I77 Mobility Partners based on the minutes.  They are already eliminating secondary road competition!
  • This money is authorized by State Statute 136-189.11 (f) – Incentives for Local Funding and Highway Tolling (extract attached) .  How does $80 million in direct access to private toll roads incentivize local governments to embrace tolling?  It should not but the votes for doing it were there from Charlotte and DOT CRTPO reps at the expense of Lake Norman projects that could have been funded with that money?

The WidenI77 group had good arguments for the TIFIA Credit Council to NOTendorse this project.   Instead of allowing the project to die a natural death and be reborn with a fair funding solution, the powers behind the project took $80 million more taxpayer dollars and put it into the private company’s toll road.  By any count $80m in direct access  + $94m in direct contributions + $69m in guaranteed revenue + a likely $189 m in taxpayer bonds bailout + $105 m in tax free bonds equals $432 million.  The three combined projects without tolls was estimated at $450 million.   This does not even consider the very significant work that must still be done on the I85/I77 interchange to accommodate future access to the toll lanes from I85.

This is government and bureaucracy at its worse and anti citizen/pro-toll vendor “Politics of Tolling” showing itself far sooner than even I expected.

We have alternative infrastructure funding solutions working their way through Raleigh and Washington.  We could avoid tolling altogether if our elected leaders made that tough decision.

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