HOT Lane Primer
New to the HOT lane issue on I77?
I-77 in the Lake Norman area was completed in 1972 and has never been widened north of mile marker 23. This section of I-77 currently carries approximately 100,000 vehicles a day and has the highest truck per highway mile density in the state. This project also includes over $400 million in infrastructure improvements south of I-85 yet adds no addition “free” capacity to that section. Lake Norman drivers will pay for this Charlotte improvement. And these lanes in this section of I-77 will continue to fill with no relief for any drivers not in the toll lanes – it will be a major road block to commerce for the Charlotte region and points north.
What are Managed/HOT lanes?
Managed or High Occupancy Toll (HOT) lanes are segregated toll lanes that run next to general purpose lanes that require drivers to pay a fee that varies based on demand (congestion pricing). The tolls change throughout the day according to the amount of drivers using them. The number of drivers using them will be determined by those willing to pay to escape the congestion in the “free” general purpose lanes. Access to the HOT lanes is restricted to specific entrance and exit points along the highway.
What is the current NCDOT plan?
The current plan is to build 1 HOT lane from Exit 36 to Exit 28, and 2 HOT lanes from Exit 28 to Exit 11 at the cost of $655 million. NCDOT would pay for $88 million of the costs upfront, and would be responsible for up to another $75 million if revenues aren’t enough to cover the debt service. $250 million of the cost is backed by a TIFIA loan which is backed by the Federal government. Similar projects in Indiana and Texas are going through bankruptcy and loan restructuring.
The current HOV lane that exists from Mile 19 to Mile 11 would be converted into a HOT lane, and the minimum occupancy required to ride for free in the HOT lanes would rise from 2 to 3 occupants.
Cintra, a Spanish company, was the only bidder on the project, and signed an initial contract called the Commercial Close) to build and manage the HOT lanes in June 2014. The contract would give Cintra the right to collect tolls on the HOT lanes for the next 50 years. The NCDOT estimates toll revenue of nearly $13 billion will be extracted from our local economy during that period.
Just as importantly, no more “free” lanes would be allowed to be built on I-77 for the life of the contract. I-77 would have 2 “free” lanes from Exit 36 to Exit 23 for 50 years regardless of the growth in the Lake Norman region over that time. As more people move to the Lake Norman area, the extra traffic will continue to increase congestion on I-77 and will cause people to use back roads for commuting that were never intended to handle large amounts of thru-traffic. The NCDOT study forecasts that this HOT lane non-solution will cause commute times in the “free” lanes to double by 2035.
The same NCDOT study forecasts a round trip commute between Mooresville and Charlotte during rush hour using the HOT lanes will cost over $20 and double by 2035.
The final “Financial Close” contract with Cintra has not yet been signed as they are still lining up lenders for the TIFIA backed bonds. We expect this to be signed in the very near future. If the NCDOT is made to back out of this contract now, the cost to the State would be about $4 to $5 million. After the “Financial Close” document is signed the cost will be many times that to stop this non-solution.
So why don’t they just build general purpose (free) lanes?
Good question. A hypothetical scoring of a general purpose project under the state’s new Strategic Transportation Initiative scored in the top 10% of all projects, and actually outscored over twenty projects that are currently slated to receive funding. One general purpose lane in each direction was estimated to cost between $100-130 million. However, the NCDOT continues to say that they don’t have the funds to pay for any general purpose lanes, and would not officially rank widening I-77 until July 1st, 2015. Since the final contract with Cintra is scheduled to be signed by the end of 2014, the NCDOT never plans to officially rank widening I-77 with general purpose lanes.
Another reason this approach is supported is that our Charlotte and regional politicians have been given the “green” light by our Lake Norman politicians. It is unclear why our Lake Norman politicians would accept a non-solution as damaging as this to our local economy but they have. The WidenI77 organization encourages you to ask “Why?” of every town, state, and federal leader.
What can be done to stop this?
The NCDOT and feckless politicians say that this is a “done deal”, but there are still ways that this could be stopped. If enough people were to stand up and protest this plan, politicians would have to at least reconsider the wisdom of this approach.
At this moment, our best hope is to legal action to stop the project from starting. Lawyers are expensive, which is why we are asking people to help in any way they can to help us pay for our legal fees. You can donate at WidenI77.org/donate.