The deadline is here for groups wanting to convince the Florida Department of Transportation to part with valuable road rights of way in Pasco County’s State Road 54/56 corridor.
The FDOT asked for the proposals after it received an unsolicited request to lease the rights of way to build a 33-mile elevated toll road that could possibly shorten the trip between Zephyrhills and New Port Richey to less than 30 minutes.
Gerald Stanley and International Infrastructure Partners LLC piqued the interest of state officials and the county as a whole with the request in June, and it’s created debate on not only if it’s good for the county, but if such a project is even feasible.
Those answers are yes and yes, said John Hagen, president and chief executive of the Pasco Economic Development Council. The fact is, Pasco County is growing quickly, and even an expanded State Road 54 struggles to accommodate the traffic it receives.
“You either have to build a bunch of new lanes and widen it out, or you have to build up,” Hagen said. “And in some places, (widening) just won’t work very well. You have stores and neighborhoods right up to the road. If you end up widening with new lanes, you’re going to be bulldozing.”
Some business owners, however, disagree. In an August meeting with Pasco County Commissioner Kathryn Starkey, a few members of the Greater Wesley Chapel Chamber of Commerce expressed opposition to the road, fearing it would allow traffic to bypass their businesses.
“Things are going to get congested if we keep going the way we’re going,” Hagen said. “The idea that you’re going to attract more business somehow as we turn the place into a parking lot is something to rethink here. A way for local businesses to get more business is to separate out the people who are not planning to stop anyway — who are just wanting to get across the county — and opening up the surface roads to local traffic.”
Following the money
If built, the elevated expressway would be the first privately owned toll road in Florida. Cost estimates weren’t shared, but using the elevated road built for Tampa’s Lee Roy Selmon Expressway in the early 2000s as a model, builders could be looking at a cost of $70 million … per mile. That would bring the total price tag of this project to around $2.3 billion.
Stanley’s group, IIP, would raise the money through private sources like hedge funds, and then try to recoup that investment — with the necessary profit — through toll revenue collected by travelers who choose the expressway.
Yet, that profit model could be troubling.
Last year, toll roads in Florida collected revenue of $616 million from travelers. That’s broken down to $1.3 million per mile. Applying those numbers to this project would generate prospective revenue of $44.2 million each year. Even if IIP never spends another dime on the road, it would take the company 52 years to recoup its investment.
But that might be OK. Neil Gray, director of government affairs for the International Bridge, Tunnel and Turnpike Association in Washington, D.C., says investors in projects like this know what they’re getting in to, and many are willing to play the long game.
“We’re talking as much as 99 years,” Gray said. “A 99-year concession is patient money. It also allows them, from the private side, to make these things happen that might not be viable on the state level. They can pool that money together right now, and build it right now.”
Not accounting for inflation or other increases and variables, a 99-year agreement on a Pasco elevated roadway would generate revenue of $4.4 billion — doubling the initial investment.
Learning from others’ mistakes
The FDOT, however, should be very careful about such long deals, says the U.S. Public Interest Research Group Education Fund, an independent advocacy group that has spoken out against road privatization.
In a 2009 report authored by Phineas Baxandall, any agreements between the government and a private entity should clearly spell out expectations, and leave some of the decision-making — like toll rates — to the public. On top of that, no deal should last longer than 30 years, because even if the toll road fails, the structure will still be there, and the county will have to deal with it.
Toll roads really can fail, by the way. Just look at the Camino Colombia Toll Road in Texas. Built in 2000 at a cost of $90 million, the 22-mile road between the Mexican border and Interstate 35 north of Laredo was expected to generate $9 million in its first year alone based on the traffic created by the North American Free Trade Agreement, U.S. PIRG said. Instead, the road that charged tractor-trailers $16 each earned just $500,000.
Within a few years, the road was sold at auction to an investment company for $12.1 million who in turn shut it down. The Texas Department of Transportation needed that road in operation, and it cost the government entity $20 million to buy it and reopen it.
“No matter who runs it, the physical structure is going to be there, and it never goes away,” said Gray, adding that lessons are being learned to prevent another Camino Colombia debacle. “Each time these transactions are done, the government side is getting smarter and smarter and smarter. Now you have governments that negotiate contracts that include a series of performance metrics. If you fail to maintain those level of standards, you will breach the contract, and the government gets the road for free.”
Something has to be done
Florida has a big problem on its hands when it comes to roads, and it may depend on private proposals like IIP’s to grow the state’s infrastructure.
By 2020, Florida is expected to be $47 billion short in funding transportation improvements, like repaving, lane expansion and new roads.
“Our gas tax funding that pays for the highway system is no longer sustainable,” said Christa Deason, a spokeswoman with Florida’s Turnpike. “People are driving less, they are using transit more, and buying hybrid cars. There is not a ton of money pouring into the coffers anymore to build these roads, or even to maintain the ones we built 50 years ago.”
Pasco County has hit a similar wall. Commissioners had proposed a local gas tax increase to help fund road maintenance and construction for the coming year, but it failed under public pressure.
“We need to look at progressive ways to move traffic on 54,” Commissioner Starkey said.
During its presentation last week to county officials, the Urban Land Institute — the independent growth and development analytical group — strongly suggested Pasco stay away from the elevated road, and instead concentrate on reducing the need for more roads in the first place. That means developing communities that have live, work and play all within walking distance, or easily accessible through public mass transit.
“What ULI was trying to say is that we need to reduce trips so that people don’t have to go all the way across the county to get to a Wiregrass mall for instance,” Pasco EDC’s Hagen said. “We should create shopping experiences that are close by, that people can walk to.”
No matter what someone’s position is on the proposed elevated road, the conversation must continue, he said.
“People are just reading a small article in the paper, or they see a 30-second thing on television, and it doesn’t really explain the full complexity of how to do traffic planning, and how it fits into good community planning,” Hagen said. “Trying to get people engaged to create some light rather than heat, that would be a good step.”