Pa. auditor general blasts rising turnpike debt

HARRISBURG, Pa. - November 13, 2012

Wagner, a Democrat, rebutted earlier testimony by turnpike commission officials and a financial consultant that the agency can sustain its financial path by raising tolls every year and that it can continue to find lenders.

He told a joint House and Senate Transportation Committee that the proportion of the commission's debt payments to overall revenue has risen to 47 percent, and likened the turnpike commission's operations to remortgaging a home to pay off credit card debts. The commission's debt has risen from $2.5 billion in 2007 to $7.8 billion, even as the fourth-straight annual toll increase took effect Jan. 1.

"What all of you keep hearing - it's what irritates me the most - is that this is OK," Wagner said. "This is not OK. This has to change. And it's really within your hands and the governor's hands to change."

Otherwise, he said, the turnpike will go over a "financial cliff at some point."

The debate over the turnpike's finances comes as lawmakers apply pressure to Gov. Tom Corbett to issue a plan to come up with some of the billions of dollars the state needs to address a longstanding backlog of crumbling roads and bridges and a system of financially strapped mass transit agencies.

Now, another big cost is looming: turnpike commission officials told lawmakers that they plan to convert the 545-mile Pennsylvania Turnpike system into all-electronic tolls that charge motorists without requiring them to drive through toll plazas.

Consultants made the recommendation in a report earlier this year, and put the cost at an estimated $319 million. The turnpike's acting chief executive officer, Craig Shuey, said the five-year project is the most ambitious of its kind in the nation.

"This will be the most significant change in how the turnpike operates since it opened in 1940," Shuey said.

The existing network of toll plazas would be replaced with overhead "gantries" that straddle travel lanes. Tolls would automatically be deducted from E-ZPass accounts and the license plates of other vehicles would be photographed so bills could be sent to their owners. Cash payments would no longer be an option.

The problem that Wagner targeted is the $450 million annual payments that the turnpike commission is required to make to the state Transportation Department to help pay for bridge repairs, road work and mass transit. The payments are a result of a 2007 law that was supposed to increase transportation funding and totaled $3.4 billion at the end of the 2012 fiscal year.

The other part of the 2007 law backfired, as well. It allowed the turnpike commission to install toll booths on Interstate 80 to raise additional revenue, but the Federal Highway Administration rejected that plan.

Transportation Secretary Barry Schoch appeared with turnpike officials at the hearing and told lawmakers that tolls will stop going up if they rewrite the law to relieve the turnpike commission of the annual payment.

PennDOT is on track this fiscal year to spend $5.3 billion on highways, bridges and mass transit, including federal money, the agency said.

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