McLEAN, VA (AP) A $900 million proposal to build four new toll lanes on a section of the Capital Beltway in Virginia is moving forward with a new agreement that provides 100 percent private funding of the construction costs.
The plan calls for construction of two high-occupancy toll (HOT) lanes in each direction of the beltway over a 14-mile stretch from Springfield to the Great Falls area, where the Beltway currently has four lanes in each direction. Carpoolers would get to use the lanes for free, while others would pay a variable toll that would increase during peak use.
The project was proposed several years ago by Fluor Enterprises Inc., but Fluor’s plans initially called for the state to cover a portion of the costs. State officials said no such money was available.
The issue was resolved when a second investor, Transurban (USA) Inc., signed a deal April 28 to pay at least 15 percent of the construction costs — an estimated $135 million — that supplants the anticipated state funding from the initial proposal.
The addition of a second private investor raises the possibility that toll operators will have to charge higher tolls so that all parties can receive a reasonable return on their investment.
But Gary Groat, a spokesman for Fluor, said the toll prices are more dependent on supply and demand than on profit margin.
The HOT lanes only work, he said, if the tolls are properly priced. Tolls too high drive people away from the lanes, and tolls that are too low entice too many motorists, clogging the lanes and eliminating the rationale for using them.
“The fees will be determined by what the market will bear,” Groat said.
Three years ago, Fluor in its initial proposal had estimated tolls of $1 to $4, with the higher tolls at peak demand times.
Transurban and Fluor are now conducting an in-depth traffic and revenue study to determine how many people might use the lanes and what they would be willing to pay. Groat said the earlier estimate of $1 to $4 serves as “a starting point” for estimating what tolls would be.
The Virginia Department of Transportation’s (VDOT) chief financial officer, Barbara Reese, said she has no estimate at all of how much it might cost to use the lanes, but she said the state will be involved in negotiations over toll prices and can intervene if the proposed fees are exorbitant.
Groat said the market and traffic analysis could be completed by September or October. Also, a federal environmental study must be completed for any work to begin.
State officials said that if all goes well, construction could begin in late 2006 or early 2007. From there, it would take 4 1/2 to five years to complete.
As the state’s ability to pay for new roads and transit has dried up in recent years, transportation advocates are increasingly turning to public-private partnerships like the proposed Beltway lanes to get new projects built.
Under the partnerships, private companies have a greater say in how a road will be designed and engineered, often resulting in cost savings. The companies recoup their investment through toll collections.
The private proposal for the $900 million Beltway project, for instance, is significantly cheaper than a $2.4 billion price tag under a preliminary study in 2002 of the same corridor by VDOT.
The private project cuts costs by using smaller shoulders and other engineering tricks that allow the new lanes to fit within a more narrow footprint. As a result, the existing Beltway interchanges do not need to be replaced. Only four to six homes will need to be purchased for the project, compared to an initial estimate of nearly 300 displacements under VDOT’s initial study.
While Fluor’s proposal will not bring the corridor up to current federal safety and engineering standards, VDOT’s chief engineer Malcolm Kerley said the existing safety standards in the corridor will be maintained and improved in some cases.
“We will accept no less than what we have right now,” Kerley said.
Similar public-private partnerships have also been proposed for the I-95 corridor in northern Virginia, the I-81 corridor and a new bridge-tunnel crossing in Hampton Roads.
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