In the first of two State Corporation Commission public input sessions held yesterday at Loudoun Valley High School, a number of speakers decried the toll raises granted to Dulles Greenway’s owners, Toll Road Investors Partnership Trip II.
Opposition came on several fronts—slamming Greenway management Australian hedge fund Macquarie Group for excessive and speculative financial practices; the SCC for not taking a firmer line to control Macquarie’s repeated calls for toll raises; the plight of commuters facing ever-rising tolls; and the intention of some Northern Virginia politicians to assume ownership of the toll road through a budget amendment in the 2014 session of the General Assembly next January.
The first, 4 p.m., session was lightly attended, with SCC Hearing Examiner Ann Berkebile presiding and SCC Chairman James Dimitri observing. Del. David Ramadan (R-87), who had requested the hearings be held to allow users of the road to express their opinions, also was in attendance.
Fellow state Del. Randy Minchew (R-10), Supervisor Janet Clarke (R-Blue Ridge) and Purcellville Mayor Bob Lazaro also spoke. All three elected leaders supported Del. Joe T. May’s (R-33) effort to have the commonwealth purchase the road, although that bill ultimately failed. Rep. Frank Wolf (R-VA-10), a consistent critic of the Greenway’s rising tolls, had submitted a statement opposing the rate hike earlier.
The SCC approved new toll rates on the Dulles Greenway Jan. 16. The SCC approved an increase of 3.02 percent, which saved commuters 2 cents per trip from Greenway owner TRIP II’s requested 14-cent increase. The company rounds its tolls to the nearest nickel.
The actual posted toll increased 10 cents, from $4 to $4.10. During weekday peak periods, the toll increases from $4.80 to $4.90. The toll for a three-axle vehicle will be $8.20, five cents less than the company’s requested increase of $8.25.
The rates went into effect Jan. 21.
Out of nine individuals to make comment Tuesday, only two speakers, Bill Haney and Judy Hanley, speaking for nonprofits Every Citizen Has Opportunities and the Loudoun Abused Women’s Shelter and Child Advocacy Center, respectively, did not join the chorus of criticism. Instead, they put in a good word for the partnership, noting their organizations had received about $200,000 each over the past five years through the Greenway Drive for Charity, enabling them to bring much needed assistance to those they serve.
“We hope that the community realizes how [the Greenway] has helped nonprofits,” Haney said.
Deborah del Veccio, from Hamilton, said she and her family use the Dulles Greenway. “In eight years, we’ve seen the tolls double. It’s discouraging and very frustrating,” she said, foreseeing “no stop, no end in sight to these raises. At “$300 a month in user costs, it’s outrageous.”
Macquarie’s financial practices came in for stringent criticism from chartered accountant and stockbroker David Jackson, a Loyalty Road resident who said he had looked into the Greenway’s finances as part of a candidate’s campaign for state offices in 2004. In 2005, Jackson said he had reviewed the partnership’s public statements and accounts, and found them shocking.
Jackson accused Macquairie of going well beyond the “no more than reasonable compensation” to which it was entitled, according to the SCC—instead striving to optimize their profits. Macquarie’s management has been “dismal for users” with excessive borrowing, Jackson claimed, and questioned “why the SCC allowed the Greenway to get in such difficulties.” It is not the SCC’s responsibility to make a profit for the company, he said, adding there needs to be a big change in how the SCC sees Macquarie’s role.
Despite $40 million in losses every year, “nothing matters for them if you can get the SCC to keep raising the rates, they’ll cover those sins,” Jackson claimed. Jackson said he doubted the situation could be turned around without toll raises.
The road venture “has failed,” he said he told a state legislator and predicted the Greenway likely would end up in bankruptcy.
Peter Rush, also a Waterford area resident, said, “I’m upset with this huge increase.” He also attacked Macquarie’s financial practices, citing long-term debt at the end of 2011 in the hundreds of millions.
“Why do we have to pay for their financial shenanigans,” he asked. Rush called for complete financial transparency, questioning the company’s financial figures. “If Macquarie can’t make a profit, it should fail. No more toll raises.”
Another speaker with financial expertise, Jeff Costell, of Waterford, said the toll road pricing has reached the monopoly level, and accused the SCC of “protecting” that monopoly. Decrying the ever-rising debt, Costell accused Macquarie of “a deceiving posture” on returns versus cash.
“They should hand the road to the commonwealth, at $500 million in the hole,” he said.
And that was the thrust of comments made by Lazaro, Clarke and Minchew. Lazaro said he was speaking as a commuter, and the proposal to charge less for those getting on the road near its terminus “is not fair.” Saying the commonwealth has a core responsibility for transportation, Lazaro supported the possibility of Virginia purchasing the road, especially at a time of low interest rates.
Clarke spoke of her family’s difficulties with the tolls, in line with many of her constituents. “We cannot afford the Greenway, with four drivers in the family,” she said, noting they have cancelled their E-ZPasses and now use other roads, including Sycolin, Rt. 7 and Rt. 659. Along with others, Clarke noted ridership on the Greenway is not increasing and that other roads are becoming severely congested.
“That speaks volumes,” she said, noting if tolls continue to rise ridership is likely to go even lower, resulting in a negative domino effect on the road. Making it difficult for people to get to work because of overly high tolls, especially at a time when the uncertainty in Washington, DC, is already taking a toll, she claimed. “People are already losing jobs.”
Minchew said his reading led him to believe the Greenway financial model has hit its maximum elasticity demand point, and that demand would continue to fall off. If tolls go down, that could lead to an increase in ridership, he said.
“We’ve got a model that is flawed right now, and that is why Del. May put in the bill for Virginia to look at purchasing it, privately.” Although May’s bill failed, Minchew said a new budget amendment is planned for the 2014 session of the General Assembly for Greenway owners and VDOT to confer on possible acquisition. “What we have now is a problematic position…that’s not sustainable for business,” Minchew said, noting the tolls on the Dulles Toll Road will continue to increase also in advance of the coming of Metro’s Silver Line.
Later, Clarke noted the second session also was lightly attended. Many commuters and users of the Greenway have sent her voluminous emails about the proposed toll increases. “Some people don’t seem to know they can express their opinions in person before the hearing examiner,” Clarke said, urging commuters to speak up at the second public input hearing, scheduled for June 6 at Park View High School in Sterling.
The evidentiary portion of the hearings will be held at 10 a.m. July 18, at the SCC offices in Richmond and will be webcast, Berkebile said.
A July 9 deadline for written comments has been established. Correspondence should be sent to the Clerk of the State Corporation Commission, Document Control Center, P.O. Box 2118, Richmond, Virginia 23218-2118, and refer to case number PUE-2013-00011.
Comments may be sent electronically via the SCC’s website, www.scc.virginia.gov/case. Click on the "public comments/notices" link and then the "submit comments" button for case number PUE-2013-00011.