Toll revenues dip due to $3 a gallon for gas

Link to AP story here.

NOTE: Businesses with fleets on the road…it’s YOU who are paying for toll roads! CONSUMERS: You get that cost passed on to you whether you take toll roads or not! Read on…

Fuel prices, storm blamed for toll revenue dip
N.J. Turnpike Authority reports lower revenue for its two highways
Posted by the Asbury Park Press on 04/23/06

Climbing gasoline prices and a winter storm at the start of 2005 caused traffic and revenues on the Garden State Parkway and New Jersey Turnpike to dip last year, officials of the toll roads say.

Toll revenues are down $5 million,” said Michael Lapolla, executive director of the New Jersey Turnpike Authority, which oversees the two highways. “Last year we had a bad snowstorm early in the year and minor traffic-diversion issues with construction at the Driscoll Bridge, and the state opened the (reconstructed) Victory Bridge.”

But the sucker punch was delivered by two devastating hurricanes, Katrina and Rita.

Since gas prices went up after Hurricane Katrina, it had a definite impact on both roads and continues to have an impact,” Lapolla said. “If people have an alternative to going on toll roads, they’ll take it.”

Parkway toll revenues dipped by $5 million between Dec. 31, 2004, and Dec. 31, 2005, from $208 million to $203 million, according to an authority report. While 601 million passenger vehicles used the parkway in 2004, that number dropped to 496 million in 2005.

Toll revenues are sensitive to weather, and one significant storm can depress earnings by 1 percent because people are not driving, Lapolla said. Although the number of people taking the Parkway to work remains constant, the revenue drop can be attributed to reductions in discretionary driving.

Many of the drivers interviewed at the Parkway service area in Wall said they have no alternative to taking the toll road to work.

“It’s the most direct route,” said Stephen Holld of Spring Lake. “Using a local road is more stop and go.”

James Golden of Little Silver said he uses a toll-free section of Parkway to go to work and makes the return trip home on local roads to avoid the expense.

“When I had a long commute, I had no choice. Now, I get on at (exit) 105, go five miles and get off at 100,” Golden said. “On the way home I take local roads and don’t pay a toll.

Christine Boyle of Stafford, who also finds herself compelled to drive on the Parkway, said she compensates for rising gasoline prices by shopping around and avoiding higher-priced brands of gas.

I don’t have a choice. I have to take toll roads,” said Boyle, who commutes to Newark and Bergen County.

Even discretionary drivers, such as Dr. Lloyd Ross of Ridgewood, said the Parkway is the better choice for a direct and faster trip than local highways to his summer house in Barnegat.

“I can come down the Parkway or Route 9,” he said.

With the price of some grades of gas around $3 per gallon, Lapolla said he expects traffic to be off this year. Gasoline prices will be the wild card in revenue growth from tolls.

“What you’ll see this year is revenue will grow a little, but it will not grow as much,” he said.

That wasn’t the case on the Turnpike, where the number of passenger cars was up slightly by 514,007 vehicles from 214,095,494 in 2004. But 304,745 more tractor-trailer trucks and 170,950 more buses used the big highway in 2005.

Trucks are the main source of revenue on the Turnpike, and truck traffic was up,” Lapolla said.

Other factors also depressed earnings for the authority. They include the cost of voluntary separation agreements that offered veteran toll collectors and other workers half a year’s salary for leaving, and one-time gains from refinancing debt in 2004.

Total revenues dipped from $829,255,596 in 2004 to $812,242,729 in 2005.

Several factors caused that, said Joe Orlando, Turnpike Authority spokesman.

The authority did not have a $31 million fiscal shot in the arm last year, which it got in 2004 from refinancing its debt

“We did a debt restructuring, so we don’t have to pay as much,” Lapolla said. “It’s like refinancing your house. We got a $31 million benefit in ’04, but it was a one-shot deal.”

A severance package of half a year’s salary offered to employees with 15 years of service or more who retired cost the authority $2.9 million, which was charged to the cost of toll collections, Orlando said. In 2005, $81.3 million was budgeted for toll collection, up from $78.3 million in 2004. That figure doesn’t include E-ZPass toll collection costs.

Of the 140 workers who took the severance offer, 60 were toll collectors, and a total of 100 jobs were eliminated, Orlando said. That should bring a $6.8 million annual savings, according to the 2006 Turnpike Authority budget.

Larry Higgs: 732-643-4277 or

Copyright © 2006 Asbury Park Press. All rights reserved.