FINANCIAL AND POLICY IMPLICATIONS OF PUBLICLY ASSISTED TOLL ROAD FINANCING IN THE UNITED STATES

The 1991 ISTEA provides for 50 and 80 percent Federal funding for public and private tollroads, bridges and tunnels. The use of Federal funds as loan pools is also provided. The leveraging of Federal and State funds by mixing them with toll revenue bond funds is not a new idea. However, the magnitude and scale of this program poses numerous difficult policy choices for State and local officials who jointly oversee the allocation of Federal funds to projects. The possibility exists for the re-emergence of unfeasible tollroads and/or the accelerated implementation of marginally feasible tollroads in advance of escalated right-of- way costs and neighbourhood development pressures. The potential to extend scarce State and Federal funds by matching them with heretofore non-existent toll revenue bonds creates some attractive policy options that most states should carefully consider. States that previously had no tollroad program should evaluate the option of creating a system of publicly-assisted tollroads and bridges. Other States may want to expand their tollway network. This paper evaluates the advantages and disadvantages of these options. The work is based, in part, on a toll policy research study conducted by the author for the Colorado Department of Transportation. (A) For the covering abstract of the seminar see IRRD 860989.