OC Transportation Corridor Agencies - Pacific Research Institute Study

[andy3175]

Two studies were released that were critical of the Orange County Transportation Corridor Agencies (https://www.thetollroads.com/), which runs the SR 73, 133, 241, and 261 toll roads.

http://www.latimes.com/local/lanow/la-me-ln-tollway-20130410,0,1370451.story

Because of the weakened financial condition of Orange County's largest tollway network, a new study recommends that its leadership postpone a road project and stop borrowing money until state authorities can review the operation.

The assessment released Wednesday by the nonprofit Pacific Research Institute in San Francisco is the second critical review in recent months of the Irvine-based Transportation Corridor Agencies, which oversees 51 miles of tollways, the biggest system of its type in the state.

In December, SNR Denton, a Los Angeles law firm that helped stop the TCA from building a route through San Onofre State Park, disclosed documents that revealed a host of issues plaguing the agency. They included sagging ridership and revenue as well as mounting debts and declining ratings for bonds sold to investors.

Rowena Itchon of the Pacific Research Institute said the organization has never opposed a TCA project until now. She described the tollway report as an independent effort under the institute's California Studies Program.

Researchers looked at the economic health of the San Joaquin Hills and Foothill-Eastern corridors, two toll networks that were once touted as an innovative way to build public highways without taxpayer money.

Overall, their study concluded that construction of the corridors was based on overly optimistic ridership projections and plans that failed to provide a financial cushion during economic downturns or periods of slow growth.

"The operations of these toll roads presently appear to be unsustainable and may have been unworkable from their inception,"  said researcher Donna Arduin, a former budget director for four states, including California during the Schwarzenegger administration. "Subsequent decisions by the TCA board members and managers have made matters worse."

The report states that to make its debt payments, the TCA has raised tolls so much that its debt per mile is now far higher than the national average for toll roads. The Foothill-Eastern's is $64 million, while the San Joaquin's is $136 million. The national average is $17.1 million, the study notes.

Regards,
Andy

[OCGuy81]

Really good story, thank you Andy.

Living in the area, I agree that future toll projects should be shelved for now.  The toll roads are often pretty light traffic wise (which is something I love about em) as people take the freeways instead. 

[cpzilliacus]

TOLLROADSnews: Orange County Calif tollroads slammed as financially mismanaged with unsustainable debt by Governor's former finance director

A study on the 241 and 73 tollroads in Orange County says that they have unsustainable debt and accuses the Transportation Corridors Agencies of a long record of financial mismanagement. The paper titled "Orange County Toll Roads: Serious Concerns Should Lead to Significant Review by State and Local Officials"  is authored by Donna Arduin, former budget director for California governor Arnold Schwarzenegger and Wayne Winegarden, a fellow with the Pacific Research Institute (PRI,) a San Francisco thinktank which publishes the report.

With a Germanic all-capitalized headline the PRI publicity reads: "New Analysis of Orange County Toll Roads Reveals Unsustainable Debt Levels, Cost Overruns, Financial Mismanagement, and an est. $1.7 Billion in Taxpayer Subsidies." And the subhead: "Proposed refinancing plans will add hundreds of millions in debt without addressing fundamental issues, former California Finance Director Donna Arduin finds."