Tuesday, November 10, 2009

Maryland Transportation Authority in Trouble

At a recent meeting of Montgomery and Prince George’s County state legislators, the state’s Department of Legislative Services (DLS) made a detailed presentation on the state’s transportation prospects. We have already covered the state’s problems with the Transportation Trust Fund (TTF). But the condition of the Maryland Transportation Authority (MdTA), which controls the state’s toll roads, is a major revelation that points to a disturbing fact: Marylanders will soon pay higher tolls just to pay for the services they already have. And that’s just the beginning.

On October 9, a team of Montgomery and Prince George’s state legislators met to consider their significant regional transportation needs. DLS updated the group on the state’s challenges in financing transportation, a regular topic on this blog. Their analysis agreed with our reporting on the TTF: namely, that the state was having increasing problems keeping up with transportation needs. But it was their focus on MdTA that really caught our attention.

MdTA is a semi-independent agency that controls the state’s toll facilities, including I-95 northeast of Baltimore, the Bay Bridge and the Intercounty Connector (ICC). It does not depend on tax revenues, but instead pays for its operating, maintenance and new construction budgets out of tolls. The agency directly controls toll levels and E-ZPass charges, all of which are set to support its budget. The state’s problems in financing its transportation needs almost guarantee that any major new road projects, including the proposed widening of I-270, will require tolls to pay for construction.

MdTA told the legislators that it is under increasing financial pressure. First, its toll revenues – the lifeblood of the agency – have dropped in year-over-year terms for 12 of the last 14 months.


This is despite the fact that the agency has tried hard to raise new revenues.


The ICC, which is being financed primarily by toll-backed bonds, is drawing on the majority of MdTA’s funding at the moment.


MdTA’s current statutory debt limit is $3.0 billion. Primarily because of the bond issues used to build the ICC, the agency will come close to its limit by 2015. Any increase will require a vote by the state legislature.


MdTA is already projecting toll increases to support its operations.


MdTA says it has “significant capital needs in the future with no clear indication of how it will pay for them.”


Those needs primarily concern bridge replacements and Express Toll Lane construction on I-95 northeast of Baltimore. The agency’s analysis does not address any widening of I-270 or any other toll-based road projects.


This data reveals an awful truth: it is not merely the Transportation Trust Fund that is in trouble. It is also the case that the state’s toll road network is on the verge of being unable to pay for its own system preservation needs – even with toll increases in recent and coming years – much less for any new road construction.

Do the Lords of Annapolis need any more evidence of the impending transportation crisis that could soon cripple the state’s economy?