Business

Negative economic impact of I77 tolls is breathtaking

JOHN MCALPINE ON TOP OF THE EXIT 28 BRIDGE

Sept. 9. By Dave Yochum. Having won the hearts and minds of Lake Norman a couple of years ago, some of the original toll fighters gathered on the Diverging Diamond at Exit 28 for a third year of protests—this time as Gov. Roy Cooper was finding his way to a fundraiser at a private home in Cornelius late last week.

Cooper can cancel the toll contract, at precisely what cost, no one knows for sure. It will require legislative efforts to fund cancellation.

But Cornelius resident John McAlpine V, an assistant professor at UNC-Charlotte, says the cost of not cancelling is far higher—in the billions of dollars.

Business, particularly logistics- and manufacturing-related, will migrate south to South Carolina where increased highway access to the critical Charleston ports is a top priority in the Palmetto State.

“Why build a factory where you can’t get any product in or out? It makes zero sense to locate a factory here when South Carolina is building business-friendly infrastructure faster than you can say toll road,” says McAlpine.

He is the Paul Revere of the North Mecklenburg toll fight.

When he was the director of electronics at the late, great Michael Waltrip Raceworld in Cornelius, he organized the I-77 Call to Action, a pivotal 2015 conference that ignited Lake Norman business leaders before any chambers were involved.

On Thursday he climbed the pedestrian walls of the Diverging Diamond to raise the American flag. He explained why the kinds of business which tend to create the most jobs, as well as major employers, will look elsewhere.

I-77 between Lake Norman and Charlotte “becomes the obvious inescapable bottleneck for I-77 from Indiana to the coast,” he says. Businesses along highways branching off to the east and west of the best route to the coast will also suffer.

There’s a triangle of economic disadvantages rising northward out of Charlotte with I-77 as the median line from the vertex in Charlotte to a base up north toward Ohio and Indiana.

Business Today was the first publication to report that there was no economic impact study done on the toll lanes which actually do nothing to relieve congestion. The toll lanes have not been designed or built to accommodate tractor-trailer trucks.

People like UNC-Charlotte transportation studies expert David Hartgen say the $640 million toll project will actually create more congestion.

Hartgen said the congestion will create a “transportation dead zone” on I-77 north of Charlotte to I-40 between Asheville and Greensboro.

In terms of the nitty-gritty of logistics that benefit North Carolina, Mecklenburg County Commissioner Jim Puckett said Wilmington is essentially too far away from population and manufacturing centers to ever eclipse Charleston, so the smart money is on Charleston.

Puckett said North Carolina’s economic leadership is realizing that the economic dead zone extends north of I-40 to an ever-widening upside-down triangle centered on I-77 and the almost insurmountable congestion from Lake Norman to Charlotte.

I-26 in South Carolina is fast becoming a “golden corridor” for critical manufacturing jobs, Puckett said.

Nevertheless, some key political leaders are pinning their hopes on Wilmington, Puckett said.

“There are those who keep hoping that we can drive everything towards the Port of Wilmington…I just don’t think Wilmington will ever be a big player because it is too far from everything but eastern North Carolina and there is nothing there,” Puckett said.

The City of Charlotte “could care less about anything that isn’t within their city limits,” said Puckett.

Multiple efforts are under way to convince the powers that be in the state to cancel and modify the toll plan, including hardening the shoulders to allow for more lanes of traffic during peak times.

Puckett called on legislators to work together against the 50-year contract. “If it takes seven years it will kill us economically,” Puckett said, explaining that 1.5 million people will be moving to the Charlotte area in the next 25 years.

The problem with a fix as per state rules and regulations right now is that it will take too long.

NCDOT Secretary Jim Trogdon says he has to run revisions through the state’s strategic transportation investment and planning system (STI) to make changes more complex than hardening the shoulders.

The General Assembly is part of this equation as well as the budget. All this came about because the state rammed through signing the 50-year contract with Cintra for no apparent reason other than to beat growing opposition in Lake Norman.

The tragic mis-step, of course, cost Gov. Pat McCrory his job.

“It’s time to buy the express lanes and buy them out,” Puckett said, referring to Cintra. “The community has come together this far we just need to get it gone. Every number up there pales in comparison to the real cost of the contract.”

NC Rep. John Bradford (R) passed a bill that could tap into credit balances in the Highway Fund and Highway Trust Fund up to $300 million to modify the toll lane contract. Estimates run upwards of $400 million to cancel the Cintra deal, which was a first-ever public-private partnership for highway improvements in North Carolina.

Where the state could go wrong in the deal it did, said NC Rep. Chaz Beasley, a Democrat. “We must continue to apply pressure on Cintra to implement, at minimum, the changes Secretary Trogdon suggests. We cannot and will not give up on a permanent solution to this toll debacle,” Beasley said.

In reality, $300 million and even $400 million is chump change compared to the real cost of economic damage done by this toll plan.

Hartgen, the UNC-Charlotte transportation professor, said the tolls will cost the state well over $30 billion in lost productivity over the life of the contract.

Cintra, meanwhile, says the toll lanes will open as scheduled by the end of this year. What, if any, state and local officials will be on hand for the ribbon-cutting is an open question.

With I-77 Express set to open in late 2018, I-77 Mobility Partners will hold a public hearing Sept.13 at 6:30 pm at Huntersville United Methodist Church. They will provide information on toll pricing methodology and initial toll rates.

Discussion

4 Responses to “Negative economic impact of I77 tolls is breathtaking”

  1. Why isn’t United States Senator Thom Tillis listed in this article? He.. with help from the state.. rammed this toll road project through to help fund his Senate campaign. Any mention of this disaster should accompany the name of the architect, Thom Tillis.

    Posted by Joel Pfyffer | September 10, 2018, 10:02 am
  2. Penalties are referred to as lost toll revenues in the contract. They have no way to measure lost toll revenues, because the projections they used were materially downgraded as overly optimistic by Fitch. But the real reason there should be no penalty is Ferrovial, the parent, is a convicted corporation of public corruption and is barred by Federal law under the FCPA from doing business with us here. But not one damn person at any level addressed this – press, DoJ, Roy Cooper as AG would not even answer my letter. Nick Tennyson’s office said the company had fired the individuals who did it. But the law does not say individuals – it says corporations. We have a whole bagful of gutless wonders here not willing to stand up and challenge this entire charade. And it will be the sad jumpstart we need to be financially ruined for the next 50 years because people refuse to take their oath to the Constitution seriously so only a relative few can make enormous profits at every one else’s expense.

    Posted by Craig Northacker | September 10, 2018, 11:08 am
  3. I’m not good at speaking or writing, but I, like almost everyone in this area, have VERY strong feelings about this project.

    I was born and raised in this area & it breaks my heart how the politicians have forced this entire Toll project.

    PLEASE make a BAD decision right. Many of you travel in the eastern part of the state where the roads have been overbuilt so you don’t have any problems. We deserve to be able to shop, go to events, go out to eat and most of all go to work in a reasonable amount of time. So that we can be home with family & friends in a lot less time without having to spend money on tolls that we don’t have.

    I also don’t understand why the politicians would strangle this area from economic success. It would & does BENEFIT our ENTIRE STATE.

    The politicians in Charlotte should also be listening because most of us are traveling to Charlotte to work and/or spend money.

    Roy Cooper PLEASE RECONSIDER & COMPLETE & DELETE!

    Posted by Winnie Donaldson | September 10, 2018, 5:29 pm
  4. Does anyone actually think this giant mess will be done by the end of the year? I’m sure Hurricane Florence will wash
    half of it out and then they will say, “that’s why we couldn’t finish!”

    Posted by William Taylor | September 10, 2018, 6:09 pm

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