Re: .... LMAO... Yep, OC Toll Roads have always been a financial mess... Just build it and they will come...
Date: 09-13-2023 - 08:50
Re: ....County-the 91 widening...
Author: FOR: "I guess" ....
Date: 09-13-2023 - 08:11
Note also... Wrote:
> Those OC toll roads were on the verge of (if not
> technically there) bankruptcy for quite a while.
> Things have recovered mainly because simply having
> a way to get there today is worth the money to a
> lot of people now. A bit ahead of their time, I
"While the bonds are not backed by the state of California, Caltrans, which maintains the TCA’s roads, must approve any refinancing that would extend the TCA’s debt repayment schedule. In 1997, the TCA got permission to extend tolling on California 241 and two nearby toll roads (Routes 133 and 261) from 2033 to 2036, to get more time to pay off the roads’ construction costs. In 2011, the TCA was allowed to extend that time further, to 2040. In 2013 it asked for and received approval to extend tolling even longer, to 2053. As a result of stagnant driving and the TCA’s financial woes, drivers in Orange County will be paying tolls on these roads for decades longer than originally anticipated.
The TCA has also raised toll rates, which, Businessweek reported, “helped the agency’s revenue reach a record $111.8 million... even as the number of vehicles using the roads fell to a 12-year low.” The TCA’s finances show no sign of improvement -- income has been “about 75 percent of projections,” according to Businessweek."
LMAO... The finances for the OC toll roads were a "house of cards" since I worked on a "sensitive" behind "closed doors" analysis my boss directed me to make of the TCA's financial and operational "numbers", in the early 90's.
The Toll Road Agency used very high "toll free" travel demand numbers, and assumed that they would use the road, no matter the cost. It was an assumption of toll elasticity with no precedent in all of the known universe. The TCA's decided to use a single "fixed rate" toll times the "fake" traffic projections to sell the bonds, and a lot of folks actually bought them. It was all pure bs using even very lose cost elasticity demand models for toll roads, where these very high per mile toll rates could easily be expected to deflect over half of potential trips.
Over the years as interest rates fell and repayment schedules were extended, and now the toll roads have a slightly higher "variable" "peak" toll, and still has a huge off peak toll, and there is still not enough off peak demand still today to generate sufficient revenues. A colleague and I used to joke that you can cone off all but one lane in the mid PM and hold chess tournaments without disturbing the players on parts of TCA there is so little off peak use.
The connection to Rt. 91 helped improve "cash flow", and then the TCA's were allowed to combine the debt of all to the Toll Roads in a refinance.
The math of high off peak tolls is simple, if "zero" vehicles using the lane is multiplied times any toll rate, the total revenue is zero. If the TCA's were to actually cut off peak rates in half, the traffic could more than double, leading to more total revenues. Today the OC Toll Roads off peak demand is a joke compared to other OC freeways. One hundred cars times 4 dollars is $400, two hundred and one cars per hour, times a two dollar toll, is $401...
I was invited to be on that Road Pricing conference panel with then "not famous" Peter Navarro back during this time, held by the Claremont Institute, to discuss this issue of "variable" demand based road pricing versus fixed tolls.