Tag: private toll road

TxDOT pushes ahead with buyout of SH 288 private toll road

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TxDOT pushes forward on buyback of SH 288
Action would reduce average daily toll rates by 50%

Aug. 23, 2024

AUSTIN – To provide Texans with toll relief and more free lanes on which to drive, the Texas Department of Transportation (TxDOT) is preparing to terminate the SH 288 Comprehensive Development Agreement (CDA).

This action will place the SH 288 managed lanes in Harris County under full state control allowing future toll rates to be significantly less than what is allowed under the current agreement and enabling TxDOT to move ahead with adding more free lanes along SH 288.

“Building roads, reducing tolls, and saving taxpayer money are top priorities,” said Governor Greg Abbott. “All three are achieved with the Texas Department of Transportation terminating the SH 288 Comprehensive Development Agreement. It will allow the State of Texas to receive over $2 billion in added valuation. TxDOT will use the added value to slash future toll charges and to build free lanes on that segment of State Highway 288. I thank TxDOT for making it easier and cheaper for Texans to travel that route.”

The public can expect a reduction of average daily toll rates by 50% in the next few years. Also, TxDOT will be prepared to begin construction of additional free lanes along portions of SH 288 by no later than 2030, eliminating the contractual restrictions and repayment requirements specified in the current concession agreement.

“I have worked every day for the last few weeks with TxDOT, the Governor, and the Attorney General to bring about this historic action to terminate the SH 288 Comprehensive Development Agreement with a foreign company,” Lt. Gov. Dan Patrick said. “It was a team effort. We will provide meaningful relief for Texas drivers along this corridor. Securing a more than $4 billion asset for just $1.7 billion will not only benefit Texas drivers, it will also enable TxDOT to continue investing in and advancing crucial roadway projects across the state. This strategic action demonstrates our commitment to making fiscally responsible decisions and prioritizing the best interests of Texas and its residents.”

“By taking this proactive, cost-saving opportunity, Texas will be able to provide toll relief by reducing average toll rates by 50% for drivers as soon as possible,” said Texas Transportation Commission Chairman Bruce Bugg, Jr. “By terminating this CDA, Texas will also be able to accelerate the construction of general-purpose lanes much faster than what the current CDA allows us. This is a big win for our taxpayers.”

TxDOT believes the cost of the “buy out” provision in the contract is substantially below the value of future toll revenues on the corridor—even with the anticipated reduction in toll rates. It is expected that the “buy out” payment of $1.7 billion would be paid off with future toll revenue bonds, ensuring that other planned projects around Texas will proceed on schedule.

Additionally, Texas can pay off debt at least 10 years earlier than the current concession agreement, allowing future tolls to be removed.

The state intends to assume operations in October 2024. Aside from lower toll rates and additional free lanes in the future, drivers should not expect to see any notable changes regarding maintenance, operations or billing.

Contact Media Relations at MediaRelations@txdot.gov or (512) 463-8700.

The Texas Department of Transportation is responsible for maintaining 80,000 miles of road and for supporting aviation, maritime, rail and public transportation across the state.

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DOUBLE TAX: TxDOT buyout of private toll road draws ire

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TxDOT Toll Road $1.7 Billion Purchase Plan Draws More Complaints from Elected Officials, Candidates

Officials and candidates see the move as a form of double taxation.

– Aug 22, 2024 – The Texan

A Texas state senator, a House member, and several House candidates have joined in expressing concerns about the Texas Department of Transportation’s (TxDOT) decision to purchase the Highway 288 toll road in Harris County for $1.7 billion and continue charging tolls for its users.

Rep. Briscoe Cain (R-Deer Park) raised questions about the decision and how much it will ultimately cost taxpayers.

“How much will this cost taxpayers to pay for this existing highway, given that TXDOT plans to issue bonds at today’s rates to pay itself back for the purchase of the road?” Cain inquired in his letter posted on X.

Sen. Mayes Middleton (R-Galveston) also sent a letter to Chairman Bruce Bugg of TxDOT expressing his concerns about the plan to continue charging tolls on Highway 288 even after purchasing it with taxpayer dollars.

“This is a form of double taxation and is antithetical to Texas’ tax-friendly reputation,” Middleton stated in his letter.

He also pointed out that the tolls that will be charged after the purchase have the  “same built-in profit rate as the private toll operator,” which Middleton said is “far above maintenance costs.” He called on TxDOT to eliminate the tolls on the road completely.

Joining Cain’s and Middleton’s concerns about the purchase are nine Republican nominees for the Texas House. They include Shelley Luther, Mike Olcott, Trey Wharton, Wes Virdell, AJ Louderback, Andy Hopper, Katrina Pierson, Helen Kerwin, and David Lowe.

In their letter, the nominees recited the Republican Party platform plank that states, “We call on the Texas Legislature to abolish existing toll roads.”

While the group of nominees acknowledges that abolishing existing toll roads may require the use of public money, they decry TxDOT’s plan to continue charging tolls, saying it sets “an alarming precedent” and “amounts to nothing less than double taxation.”

The toll road was constructed by BlueRidge Transportation Group and extends about 10 miles from Blodgett Street in Harris County southward, ending approximately at the county line between Harris and Brazoria counties. According to TxDOT, “The highway serves as an important thoroughfare into Houston and the primary express artery to the world’s largest medical complex, the Texas Medical Center.”

When The Texan previously asked about the total cost of the purchase, including finance costs, TxDOT spokesperson Adam Hammons said it is “too soon for TxDOT to make specific public disclosures of debt at this time.”

About the continuing toll charges, Hammons said that TxDOT anticipates reducing toll rates in the future, but that “during the contractually required transition period,” tolling policies that require some of the toll rates to increase each year based on inflation data on January 1 will continue.