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Audit Reveals The High Cost Of Toll Roads
Financial analysis of major toll road systems finds substantial diversion of revenue to third parties.

ATRI report cover
Of the billions of dollars collected at toll booths around the country, nearly half of the money goes to overhead costs, profit for the private companies involved and other uses that have nothing to do with the road itself. That is the finding of a financial audit released last week by the American Transportation Research Institute (ATRI), which conducted the analysis on behalf of the trucking industry. The report examined financial records for major toll road networks that together collected $14.7 billion in revenue in 2018.

"The findings indicate that the 21 major tolling systems analyzed collect revenue in excess of the actual direct costs of operations and interest expense, with nearly 50 percent of toll revenue diverted to other uses," the report concluded. "This excess revenue is diverted in a number of ways based upon the individual agency or state that supervises the toll entity. The magnitude of diversion and the lack of standard practice with regard to revenue diversion speaks to the disjointed control under which toll entities operate."

The roads covered in the report represent 82 percent of all tolls collected in the country. The full nationwide toll network generates an estimated $18 billion in revenue each year. Of that revenue, 15.8 cents on every dollar goes to the cost of collecting the toll itself. Another 26.8 percent goes to the cost of interest and 20.5 percent is diverted to non-road use such as transit, undermining the "user pays" argument used by tolling advocates.

The report found tolls tend to increase far in excess of the rate of inflation -- up 72 percent over the last ten years, compared to the consumer price index the went up 16.9 percent in the same period. The data show the number of individual transactions at each toll road only went up 28 percent, while traffic volume increased 2.4 percent. Toll roads received $1.1 billion in taxpayer subsidies.

The report noted that by comparison the cost of collecting the federal fuels tax was just 0.2 percent of the revenue collected. While some have argued that gas tax revenue is no longer viable because this income source is on the decline, the latest federal statistics show Americans used 147 billion gallons of gas in 2018 -- an all-time high. Preliminary data for 2019 show gas tax revenue rising for an eighth straight year.

Source: PDF File Financial Analysis of Toll System Revenue (American Transportation Research Institute, 1/31/2020)

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