Federal funding Nixed; Turnpike Authority Needs State Guarantees
Thanks to your letters and calls, this summer (2010) the federal government said it will not loan the money the Turnpike Authority wanted to help finance the $1.1 billion Garden Parkway. This is a big setback for the Turnpike Authority. Federal money and $505 million in state taxpayer gap funding were needed to make up the shortfall in toll revenues.But the Garden Parkway isn’t dead. Now there are plans to try to borrow the money from “secondary sources.” That means Wall Street bankers, pension funds, and all the other people who make money from lending money. And because toll roads are risky business, these lenders will want the state of North Carolina to guarantee that they will get their money back. (Think bankruptcy of Greenville’s nine year old Southern Connector toll road when less than 7,500 cars were willing to pay $2.50 for the 16 mile ride.) It is no different than asking a parent to co-sign the note on the sixteen-year old’s first car. If the kid can’t make the payments, then mom and dad will have to fork out the coin.
And the state guarantees wouldn’t stop with just the secondary loans. To get their funding, Garden Parkway promoters also need North Carolina taxpayers to guarantee that the tolls will come in as promised.
Borrowing the $505 million gap funding and guaranteeing another $630 million in debt is a big problem for us North Carolina taxpayers. The State can’t borrow hardly any more money without putting the State’s excellent credit rating at risk. North Carolina already owes $6 billion, and with the economy like it is the state can’t take on more than $ 9 million for each of the next five years. If North Carolina ever loses its top credit rating, it is the taxpayers who will have to pay the price of higher interest rates and decreased state services – like fewer school teachers and more broken down bridges.
Wildly Unpopular
There is no doubt that the toll road to no where is wildly unpopular in Gaston County. A recent poll found that over 60% of Gaston County voters were strongly opposed to the back country toll road. North Carolinians are known throughout the country as being among the worst violators of toll booths in other states, which just proves the point that no local is likely to fork over the $2.20 to $4.40 that each trip will vacuum out of the old change bucket.And don’t think out of towners are going to pay for the toll road, either. Under the proposed set up, you don’t stop and throw change into a bucket. Instead, you just keep driving under a magic wand that takes a picture of your license and sends a bill to your house. The problem: there is no way to force out of state drivers to put a check back in the mail.
Bankruptcy & Bill To Taxpayer is Real Risk
Down in Greenville, South Carolina’s nine year old Southern Connector toll road filed for bankruptcy because traffic never materialized as projected. Not only did South Carolina’s management company leave SC taxpayers holding the bag for $8.3 million, it didn’t have the money to issue paychecks to its employees, much less make the payments on the $200 million note. When the 16 mile road opened in 2001, it was supposed to have 21,000 cars a day, but less than 7,500 were willing to pay the $2.50 toll. The company that estimated traffic for the Greenville road is the same company that is estimating demand for the toll road to no where.
“Bankrupt toll road in South Carolina casts doubt over Garden Parkway,” shouted the Gazette on Page 1A Tuesday and News36 carried a story that evening. And there are a million reasons why the toll road to no where is bad business. Start with the price tag for the twenty two mile toll road to no where. With the construction price as high as $1.1 billion, tolls will cost between $2.20 and $4.40, a lot more than the SC toll road. How many Gaston County commuters do you know who can fork out nearly ten bucks a day (over $2200 a year) to drive to and from work? Like the Southern Connector, promoters are counting on the back country Garden Parkway to stimulate new development. When they say “stimulate new development,” in reality that means they are just making up the traffic numbers. Let’s face it. People in North and South Carolina will not pay tolls to ride on a road when they are already paying taxes for roads. That’s the way we grew up and that’s the way we’re going to be.
But a big piece of the $1.1 billion price tag comes from state tax payers shelling out $35 million a year for 40 years in gap funding – now estimated to total of $565 million. At least it was that way until the NC State legislature voted this session to strip $15 million from next year’s Garden Parkway gap funding and put it with another $31 million towards replacing the state's mission-critical I-85 bridge over the Yadkin River. See for yourself by clicking here and going to page 155 of the budget bill. If you recall, the 55 year old Yadkin River bridge is in such bad shape that for the past several years it has gotten the state's lowest safety rating. Of course, this $46 million still falls well short of the $136 million it will take to replace the bridge, which carries 70,000 cars a day.
Of course, it makes perfect sense to fix the roads and bridges we have already got instead of building even more roads and bridges we can't keep up. Taking the $15 million from the GP gap funding not only shows that legislative support for the back country toll road is unraveling, but it also proves what Gastonia's City Council and others have been saying for over a year -- gap funding can be redeployed to any project the legislature wants. If this community were smart, we would be lobbying hard to get those funds directed to the county's most important projects -- fixing the I-85 US 321 interchange.
So where’s the money? North Carolina Taxpayers would still be on the hook for $540 million
There are several significant financial steps that have to work out. First, the Turnpike Authority has to get enough traffic and revenue information to convince Wall Street that Gaston County drivers are willing to pay back $402 million in tolls just to save just a few minutes drive time through the country. But with the recession, people are driving less, have fewer places to go, and simply are not willing to spend money to travel like they used to.
Second, North Carolina’s taxpayers will have to step up with the promised $505 million in gap funding. North Carolina’s taxpayers should really question whether they should pay for this political pet project when the state can't even keep up all the roads and bridges we have already got. And State Treasurer Janet Cowell says that the State can’t borrow any more money without putting the State’s excellent credit rating at risk. The cost to taxpayers is way out of line at a time when the state simply doesn't have any money to fritter away on pet projects of the politically connected.
Schedule Going Forward
The Turnpike Authority says it will issue the Environmental Impact Statement in September 2010. This is one of the documents where the Authority will have to show that the new back country toll road project will relieve traffic on I-85 and won’t add to area air pollution.
Later in the fall the finance plan and final decision to move forward is supposed to come out. These are two more important documents that we will have to read closely.
If the Authority decides to go forward and the community doesn’t launch a lawsuit to stop them, they will borrow the money for the project in August 2011. If the banks will loan the money, then the Authority will sign a contract at the same time, and hope to start collecting tolls in 2015.
The plan is to start at I-485 in Mecklenberg and work west past 321 and up to I-85. The Authority is proposing asphalt construction because it is cheaper, but only concrete will support the trucks that supporters keep saying they plan to get off I-85. And that also means there cannot be the truck warehouse distribution other supporters say will bring jobs in connection with the intermodal facility at the Charlotte Douglas Airport.
What do we do now?
We have already made a tremendous difference in this project. If it wasn’t for the community standing up and asking hard questions, there would have been an interstate that stopped at US 321. But hard questions remain.
Does it make sense for the state to spend $505 million on a road project that won’t relieve congestion, will add to air pollution, will save just a couple minutes of travel, and will jeopardize our stellar credit rating at time when we need to be tightening our belts?
We need to continue talking to our elected official, media, neighbors and coworkers and let them know that this country road won’t relieve congestion at the I-85 Belmont bottleneck, it won’t improve travel times, and it for sure isn’t worth $540 million in North Carolina taxpayer money. This isn’t like the Monroe Bypass, where a toll road around Monroe would save drivers nearly 30 minutes on the heavily traveled highway that runs from the coast to the mountains.
THE PERFECT ROAD IS NO ROAD AT ALL
Keep talking about the Garden Parkway and why it is still a bad idea! Issues that still need answers:
- Are toll projections realistic?
- Who will use a toll road that parallels a free road (I-85)?
- Who can afford to pay a toll to use a road in these uncertain economic times?
- The NC Toll Authority document on traffic counts have shown that congestion on I-85 will go up MORE if the Garden Parkway is built and there will be LESS congestion on I-85 if it is NOT BUILT (Wow!)
- There is talk about industry coming if we build this road, but what industry will pay to drive on a back country road?
- Accountability – think about the future. If the road gets built and the toll numbers just don’t add up and there is not enough to pay the debt, where will the money be found?
Our goal is to spread the word about the "Toll Road to No Where." Over 7,300 people signed a petition opposing this dead-end superhighway. Please use this site as a starting point to learn more about the project and how you can get involved.
Your questions, calls and petitions have made a tremendous difference. After citizens started asking questions the Turnpike Authority admitted that the Garden Parkway would dead end into undeveloped land and now they have guaranteed that won't happen.
There is still no word yet how the Turnpike Authority will address the very serious environmental concerns raised by EPA and the broad based community opposition that came to light last spring. Click here to read about the study to determine the solvency of the toll road project in the Gaston Gazette. EPA is very strongly opposed to this project as it is currently proposed.
A recently completed study for Gastonia estimates that building a commuter rail line between Gastonia and Charlotte would cost between $265 and $300 million, less than one quarter the cost of the Garden Parkway. The corridor for the rail line is already in place and no one would be put out of their homes or business. Better yet, commuter rail would help put soul and life back into our struggling community downtowns and grow jobs just as it has along Charlotte's light rail. Click here to read the Gaston Gazette story about the cost of building commuter rail.
Of course, local elected officials are the ones who at the end of the day are going to put a stop to the toll road, or at least insist on a project that makes sense for the community.
Your work helped educate folks to the problems with the toll road. Now it's time to write letters to the Gazette and let local leaders know that commuter rail between Gastonia, Belmont, Mt. Holly and Charlotte makes more sense than pouring money into a toll road to no where that would bleed the life away from our community centers.
Emails to the Gaston Gazette should be sent to:
Barry Bridges bbridges@gastongazette.com
Emails to elected officials should be sent to:
Raleigh Delegation
David Hoyle david.hoyle@ncleg.net
Wil Neuman wiln@ncleg.net
Bill Current billcu@ncleg.net
Pearl Floyd pearl.burris-floyd@ncleg.net
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Your phone calls and letters are making a difference. If you think this toll road to no where is a bad idea, make your voice heard! Working together our communities can stop this toll road to no where. Click on the What You Can Do button to see what you can do now. This toll road can be stopped!
Turnpike Authority Schedule Slips <Revised Aug 2010>
| Finished | Evaluate Public and Government Comments |
| Sept 2010 (from June 2010) | Issue Final Environmental Impact Statement |
| Late Fall 2010 (from October 2010) | Record of Decision |
| Aug 2011 (from March 2011) | Begin Construction |
| 2015 (from December 2014) | Open to traffic |
