Whether
motivated by campaign season or a sincere desire
to “protect” the public interest, Congressman
Frank Wolf’s increasingly vocal opposition to
the recent toll increase on the Dulles Greenway is
unfortunately misguided. Worse, it could harm the
Commonwealth’s ability to provide the
transportation infrastructure needed to reduce
congestion and improve mobility for years to come.
In
reaction to the toll increases, Congressman Wolf
has convinced Attorney General Robert McDonnell to
review the Greenway operator’s recently approved
toll rate increase, and has called for the General
Assembly to undo the law that created the Greenway
in the first place.
The
reality is the privately financed and operated
Greenway is regulated like any other private
utility — gas, electric, and telecommunications
— in Virginia. Rates and toll increases
are vetted and approved or disapproved by the
State Corporation Commission (SCC), which has the
responsibility of ensuring that the public
interest is protected in such increases.
After
more than a dozen years of regulating the
Greenway, there’s no reason to think that the
SCC failed to protect the public interest when
approving the new toll rates. In fact, the SCC
recently determined that the road has operated at
a loss since construction began in 1993, and that
the toll increase, “will, as required by
Virginia law, provide [the operator] no more than
a reasonable return while not discouraging use of
the Dulles Greenway.”
More
than 55,000 commuters daily choose to avoid the
congested parallel Route 7 and pay $3.00 to use
the Greenway. The Greenway is a form of congestion
insurance, giving commuters an option if they need
to get somewhere fast. It’s reasonable to expect
that users will continue to value their time and
will pay a little extra for the convenience and
time savings associated with using the Greenway.
Remember, this is a voluntary decision on the part
of the commuters — to pay for avoiding
congestion.
In
his request to Attorney General McDonnell,
Congressman Wolf states that “the outcome [of
his review] also could have a bearing on future
state transportation agreements, such as the High
Occupancy Toll (HOT) lanes project on the Capital
Beltway” (Note: for a detailed overview of this
privately financed project, see "Loosening
the Beltway.")
Wolf
is right about one thing: the legal review, along
with Wolf's own heated rhetoric, could
scare away private investors if these investors
conclude the political climate in Virginia is too
risky. That could mean that vital transportation
projects go unfunded while other states like
Georgia and Florida, with their open arms to
private investment, reap the benefits of these
private investments. These other states will reap
increased mobility as Virginia commuters struggle
in unnecessary congestion.
Wolf
appears to have abandoned fundamental principles
that underlie our system of governance, rule of
law, and free market economy. First, the Greenway
is a state road subject to review and oversight by
state utility regulators, making interference in
rate-setting decisions by a federal representative
unwarranted. Wolf may have forgotten that the
agreement between the Commonwealth and the
Greenway operator is a contractual one and cannot
be amended by legislation, only through
negotiation between the two parties. Even if the
General Assembly attempted to undo the contract
through legislative action, it is highly doubtful
that the courts would allow this to occur, given
that the legal sanctity of contracts is a crucial
underpinning of our free market economy.
Second,
Congressman Wolf needs to revisit the benefits of
private investment in infrastructure delivery.
Government has proven itself unwilling and unable
to provide the infrastructure Virginia needs to
meet the needs of the 21st century economy.
Taxpayers benefit when the private sector provides
congestion relief by financing and building new
roads. The Commonwealth could not afford to build
the Greenway, for example, and today it lacks the
resources to make many of the investments needed
throughout the state. Without private financing,
many of these projects may never come to fruition.
Third,
one of the all-too-often forgotten advantages that
toll financing offers over general taxes is that
tolls give the user the choice of whether or not
to pay the toll. There are numerous un-tolled
alternatives to the Greenway on Routes 7, 28, and
50. Yet, 55,000 commuters choose to pay the toll,
free of government involvement, each and every
day.
Also
misguided is Congressman Wolf’s suggestion that
the Commonwealth expropriate the Dulles Greenway
using its eminent domain authority. A state
takeover of a road financed, built, and operated
by a private company is, frankly, an idea more
suited to Hugo Chavez’s Venezuela than it is to
modern America. Hopefully, Congressman Wolf
will re-evaluate his position.
A
vast majority of Americans realize that strong
private property rights are key to freedom,
progress, and a dynamic market economy. To propose
a state takeover of the Greenway is just as
egregious as it would be to propose expropriating
assets from Verizon, Dominion Virginia Power,
Roanoke Gas, or any other private sector,
investor-owned utility that faces stringent state
regulation. Government’s role is to protect
private property rights whenever possible, not
selectively undermine them.
Far
from helping commuters, Congressman Wolf may be harming them. By turning up the heat on the
Greenway, he increases the perceived political
risk of investing dollars in Virginia’s
infrastructure. The greater the risk, the greater
the likelihood that private investors interested
in expanding and modernizing Virginia’s
transportation infrastructure will shift their
focus to states where they are welcomed by
innovative policymakers. The fact that
Virginia’s nationally-regarded public-private
partnership law has survived intact the shifting
political winds over the last 12 years is a
testament to its efficacy in protecting the public
interest.
Rep.
Wolf should embrace — not oppose — tolling and
public-private partnerships, as they’re a proven
way to get traffic moving again and deliver needed
infrastructure where government is clearly falling
short.
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October 29, 2007
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