I predict that within a year we will be reading stories about a massive shortfall in revenue from the Katy Tollway. The Katy Freeway project will be completed very soon, with a configuration of two tolled lanes and five free lanes in each direction. I am looking at the picture above and doubt that even during the morning rush there will be enough rich lawyers willing to pay the tolls in order to get downtown.The tolled lanes are supposed to pay for the increased cost of the project. The freeway would have taken an additional 4 years to complete, but with the HCTRA coming on board a big chunk of extra cash became available to speed things up.
I expect some antsy bondholders, and a further increase in tolls on the Sam.
(Photo from Erik Slotboom's site.)
10 comments:
Got you with HOT lanes too, did they?
They are just starting to build these on the DC Beltway. Supposedly, the toll system will be automagic, charging you the toll only when you don't have the required HOV passengers. Electronically. Without a human in a toll booth. What's not clear is how the sensors will find the kid in the little rear-facing car seat, or alike.
The tolls are also a concern here. Not to worry though. Soon, more of us will be paying them. See, the contract guarantees the road builder his cut regardless. So, if traffic increases the state is prevented from building more lanes without the HOT lane operators say-so. And if traffic decreases, say due to $4 gas...well let's not go there.
You might be right. But economics indicates that when you provide a free resource, people tend to use it to capacity. With the 6000 housing development to start construction in Fulshear soon, I think that you'll see five clogged lanes in each direction and plenty of rich lawyers, doctors, accountants, sales executives, and energy executives willing to pony up.
Me, I just leave the house at 6 am. It sucks, but is better than the alternative.
Uh, either it's not apparent at all, or I'm just too lazy to look hard enough, but what is the pricing on that tollway? All I can find is something about "dynamic pricing", which is as meaningless as a store offering "up to 50% off".
Nova,
If you are referring to the DC HOT lanes, my employer says something in the range of 10 cents to $1 per mile.
Uh, either it's not apparent at all, or I'm just too lazy to look hard enough, but what is the pricing on that tollway?
TBD on the Katy. Pricing will change depending upon congestion.
>> something in the range of
>> 10 cents to $1 per mile.
>> TBD on the Katy. Pricing will
>> change depending upon congestion.
This kind of drives me crazy about these HOT lanes. How the heck can you even guess if you'd like it to be available if the potential price can vary by an order of magnitude?
Now if they could say "10 cents per mile at night, 30 cents midday, $1 peak hour", I could at least live with that. Otherwise, seems like signing up for a badly unpredictable cell phone plan.
Nova,
I'm hoping there will be some sort of electronic sign at the entrance points posting the current price. After all, on the DC beltway they now have electronic signs that can change the speed limit every 20 minutes. Why not the same for the toll rate?
Isn't this great? Now the poor are left to the crowded lanes, whereas their 'betters' can just zip into (and out of) town!
How egalitarian! (not)
I am wondering if there will be a shortfall in revenue myself, but most likely it will be subsidized by the highly profitable Sam Houston Tollway, like the Hardy Toll Road has been all these years. (With the Hardy Toll Road downtown extension, that may change, however.)
Even if the Katy Tollway has a minor shortfall, they get the following benefits:
1. They get significant public visibility.
2. They have a greater say in regional mobility since they are partnering on a major project like this. In essence, they did save the day by coming in and chipping in for this ambitions project, after all.
3. They can use it as leverage for their future projects. "Well, we did shave off 5 years for expanding the Katy Freeway and we are losing money on it, so maybe you can pay us back by allowing us to build XYZ tollway over here."
4. Additional EZ Tag users, who will reduce toll booth usage on the other tollways operated by HCTRA.
5. Since EZ Tags are prepaid debit accounts, the additional accounts opened also create additional cash. Plus since there is a minimum $40 deposit, they have to use that money somewhere at some toll road in Texas.
6. HCTRA is controlled by the County Commissioners Court, and all the Commissioners are elected leaders. Most of them have a bigger vision on how to best help the county and their constituents, and the county and its elected leaders come out looking like heroes by stepping up when the time was needed.
Plus, they are expecting Houston's population to grow by a few million people in the next decade. You think its crowded now, wait 10 years. People will gladly pay the toll then.
I think they were looking at some of those benefits in addition to the revenue generated. Plus, since the toll road authority is basically a branch of the county government, their motives to build the Katy Tollway may have actually been something they felt was in the best interest of the county, even if it only broke even or was subsidized by the more profitable tollways.
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