The General Assembly's policy analysts warned lawmakers Friday that Gov. Larry Hogan's suggested decreases in tolls could have a harmful effect on the maintenance and operations of the Maryland Transportation Authority's highways, bridges and tunnels.
The Department of Legislative Services told a Senate budget subcommittee that too large a toll reduction could throw off the debt service ratios that allow the authority to maintain a stellar bond rating. The analysts also noted that the authority's revenue forecasts don't take into account the acknowledged need to replace a Southern Maryland bridge at a cost of $1 billion or more. In addition, they noted that revenues are growing at about one-third the rate of increases in expenses.
During last year's campaign Hogan criticized the administration of Gov. Martin O'Malley for raising tolls in 2011 and 2013, often lumping them in with what he called O'Malley's "40 consecutive tax increases." Upon taking office, Hogan said his administration would review the tolls with an eye toward cutting them.
The analysts' report says those increases, which were adopted largely to pay back the bonds that financed two "mega-projects" launched during the administration of Gov. Robert L. Ehrlich Jr., have put the authority on a sound financial footing.
Bruce W. Gartner, the authority's executive director, confirmed that the agency is in good fiscal shape and does see any need to raise tolls through the rest of this decade.
Gartner said the authority's board is studying whether an toll cuts are possible. He said any decreases it adopts would be applied to E-ZPass transactions only. He said it would be impractical to lower cash tolls by less than a full dollar.
"It's not very practical for us to go back to quarters," he said.
Gartner said users of Maryland's toll facilities could face toll increases in the 2020s because of the cost of replacing the Harry W. Nice Memorial Bridge, which carries U.S. 301 over the Potomac River to Virginia. The two-lane bridge, which is considered obsolete, opened in 1940. Gartner said a new bridge would be built between 2020 and 2025.
Even if the state enters into a public-private partnership to defray some of the costs, higher tolls at other facilities will be needed to cover the project's costs, Gartner told senators. Tolls are set by the independent authority's board and are not subject to a vote in the General Assembly.
Besides the Nice Bridge, the authority has long operated the Harbor and Fort McHenry tunnels, the Bay Bridge, the John F. Kennedy Memorial Highway and the Thomas J. Hatem Memorial Bridge on U.S. 40. The authority opened the Intercounty Connector (Route 200) in 2011 and Express Toll Lanes on Interstate 95 in December.