United States Public Roads Administration

“ With all highway needs so pressing, administrators in a State are reluctant to ask for general increases in taxes to build roads of principal interest to one section of the State or to drivers from other States. At the same time, drivers traversing the section of the State where a controlled-access highway is needed, particularly those from out of the State who are usually on long trips and are infrequent users of the road, are not reluctant to pay a toll for the assurance of rapid travel on a safe and uncongested highway. ”

“ One of the obvious conclusions from the experience of toll-road operation and studies of feasibility and cost that have been made is that the situation is never static. Conclusions reached today may have to be altered within a year as new developments appear. It is almost axiomatic, however, that with the steady increase in traffic volumes everywhere in the country and with traffic needs increasing so much faster than the facilities provided for its movement, financing through revenue bonds will become increasingly attractive unless provision of public funds is substantially increased. ”

“ On the other hand, some States have provided for the pooling of revenues from separate sections of a route or from different routes so that an entire system may be financed as a unit and not as separate independent sections. In such cases earnings on a particular section or route in excess of requirements may be applied to supplement the earnings on other sections or routes that in themselves do not show a feasibility ratio sufficiently high to make them attractive investments. ”

“ Two conditions inherent in toll-road operation produce a pronounced effect on the Federal-aid program:
A toll road cannot serve all the traffic for which some route must provide service. The first responsibility of operators of a toll road is to the investors. This is not to imply that in many instances toll roads are not practicable and thoroughly satisfactory answers to traffic problems. In all cases, however, these two factors must be considered in weighing the desirability of including a toll road in the overall highway network. ”

“ A report on the feasibility of toll roads throughout the United States, prepared within the time and cost limitation of this study, must necessarily be in most general terms. Accurate determination of the feasibility of a single project requires intensive studies of construction cost and of traffic, taking into consideration the origin and destination of trips, which generally cannot be completed in less than about a year. Such studies have been made for some individual projects but the mileage of these is very small indeed when viewed in the light of a nationwide highway program. ”

“ Financing of roads through the sale of revenue bonds has developed because provision of public funds through accepted channels has lagged far behind highway needs. In this situation, revenue-bond financing has provided many miles of badly needed controlled-access highways when other means have failed. The financial success of the early examples of the modern toll road and the rapid extension of toll roads on some of our most important routes raises serious questions as to the place of the toll road in the Federal-aid systems and to its effect on the Federal-aid program. ”

“ On the other hand, a properly located and designed free road can serve both the through and local traffic. As an indication of the limitation of traffic service that can be provided by toll roads, it was estimated that the Interstate System, if its inadequate sections were completed as toll roads located in keeping with current practice, would serve only two-thirds of the traffic that the system would serve if it were completed as a free system. ”

“ The cost of collecting tolls is such that toll stations are usually operated only where there is sufficient usage to make them profitable. Even in the congested section of the country with a closely spaced road network, the average distance between interchanges on existing toll roads ranges from 7 to 14 miles.
Since short trips predominate in the traffic stream, many drivers are precluded from the use of a toll road merely because their trips are not long enough to permit them to take advantage of it. ”

“ Consequently, turnpike traffic is predominantly a summer traffic, and is largely composed of vehicles carrying people who, because they are vacationing, were expected by many to be more willing to pay toll than those who drive for business or similar purposes.
Studies conducted by the Bureau of Public Roads in cooperation with the Maine Turnpike Commission and the Maine State Highway Commission reveal that drivers on vacation trips do use the turnpike in greater proportion than do those on business or similar trips. ”

“ A driver receives a card as he enters and surrenders it when leaving, and the toll paid is based on the distance traveled on the turnpike. On the Garden State Parkway, tolls of a fixed amount are collected at each of a series of toll gates, or “barriers,” through which all traffic passes. Thus drivers who both enter and leave the parkway at interchanges between adjacent barriers pay no toll. Drivers passing a barrier pay the fixed fee regardless of where they enter, and drivers traversing a considerable length of the parkway pay tolls at each of a series of barriers. ”

“ Estimates of the proportion of traffic that may be expected to be attracted to roads of modern design, the amount of revenue that may be expected from concessions for the sale of gasoline and food, and factors of safety that investment bankers regard as necessary before subscribing to proposed bond issues may now be made on the basis of actual experience on a number of toll roads operating under a variety of conditions. ”

“ Public officials then generally hold in abeyance further activity in construction or even in planning and programing improvements along the line of the route and also on roads intersecting or closely paralleling the proposed toll road. Should improvements be made and the toll road later constructed, highway officials might be placed in the position of having wasted public funds or of entering into competition for traffic with a toll authority whose income depends on the continuance of a substantial advantage in traffic service of its facility over that of parallel free facilities. ”

“ Some of the 6,700 miles lie in States that have not authorized toll financing and, as a matter of policy, may prefer not to finance roads in this way in the future. Other mileage lies in States in which authority to construct toll roads is limited to particular routes and in which there is no authority to construct sections on other routes that might have been found in this study to be feasible of toll financing. ”

“ There shall be designated within the continental United States a National System of Interstate Highways not exceeding forty thousand miles in total extent so located as to connect by routes, as direct as practicable, the principal metropolitan areas, cities, and industrial centers, to serve the national defense, and to connect at suitable border points with routes of continental importance in the Dominion of Canada and the Republic of Mexico. ”

“ Net operating income was determined by deducting the amount needed for administrative, operational, and maintenance expenses and replacement reserves from total receipts from tolls and concessions. Experience in recent years shows that bonds offered to finance projects having a feasibility ratio of 1.5 or more, calculated in the manner described, would be marketable. Therefore, any section having a ratio of 1.5 or more was regarded as feasible of construction through toll financing. ”

“ Toll roads are most readily accepted on routes where existing congestion and delays are great and the construction of a controlled-access highway would produce substantial savings of time and increased comfort and safety of travel. Additional acceptance is found when out-of-State vehicles are prominent in the traffic. ”

“ In the more congested areas, where traffic volumes are sufficient to require two or more roughly parallel routes, there is advantage in locating one to accommodate principally the through traffic, whether it be toll or free, and another to accommodate local or shorter-range movement. ”

“ A further deterrent to accelerating construction on the more important routes is the general practice of earmarking funds specifically for expenditure on particular systems. Moreover, as a matter of policy or legislative requirement, it is usually not practicable to concentrate funds for a particular system on a limited mileage of that system. More often, funds are spread as uniformly as practicable over the entire system. ”

“ With the combination of prospective toll revenues and the guaranty of part of the costs of amortization, bonds in that amount sold at a net interest cost of 2.97 percent. Since the opening of the turnpike, costs of operation have been borne by highway funds, but the revenues from tolls have been more than adequate to meet the requirements for debt service and creation of a reserve, and it has not been necessary to call on the highway funds for that purpose. ”

“ Further, by this measure of traffic relief, it might be found considerably less costly for the responsible public agency to maintain the free route in condition suitable for its remaining traffic than it would be to provide and maintain a single facility for the entire traffic flow through the area. Despite whatever saving may accrue to the public agency, however, the fact remains that the two facilities must be maintained, one from public funds and one from funds from private sources ”

“ Under the general direction of this committee the Bureau of Public Roads continued its investigations that led to the recommendations of the 1939 report and prepared the report Interregional Highways [1] which the President transmitted to the Congress on January 12, 1944. ”