Study: Gas-tax hike the way to go

Privatization of toll roads would push truck traffic onto nearby roads, endangering motorists there and hurting the economy by slowing interstate freight movement, according to a new academic study.

The authors of the analysis suggested that higher fuel taxes are better tools to raise money for states' transportation needs.

The study, presented Monday at the annual meeting of the Transportation Research Board in Washington, comes as Pennsylvania, New Jersey and other states are considering higher road tolls or leasing toll roads to private operators.

It was released a day before the National Surface Transportation Police and Revenue Study Commission recommended raising federal gasoline taxes up to 40 cents per gallon over five years to fix aging bridges and roads and reduce traffic deaths.

"It is important that the effect of shifting from fuel taxes to tolls as well as highway privatization be understood better before the United States implements changes that will be very costly to reverse," concluded the paper's authors, Peter Swan, assistant professor of logistics and operations management at Pennsylvania State University, Harrisburg, and Michael Belzer, associate professor of economics at Wayne State University.

The two examined the effect of toll increases on the Ohio Turnpike between 1990 and 2005. They concluded that about 14 percent of truck traffic was diverted from the turnpike after the hikes, and they found corresponding increases of truck traffic on nearby non-toll highways.

The study did not look at the effect of toll increases on auto traffic, but Belzer said yesterday he expected the results would be similar.

Belzer was critical of the toll-increase efforts in Pennsylvania and New Jersey.

Pennsylvania seeks to put tolls on Interstate 80 and raise them on the Pennsylvania Turnpike to generate about $1 billion more a year for highways, bridges and mass transit.

As an alternative, Gov. Rendell has suggested leasing the turnpike to a private operator and using the proceeds for transportation projects.

In New Jersey, Gov. Corzine announced a plan last week to "monetize" the New Jersey Turnpike and the Garden State Parkway by having a nonprofit public corporation borrow up to $38 billion and pay off the debt with toll increases of more than 50 percent every four years through 2022.

"I think the worst thing is privatization and the second-worst is monetization," Belzer said yesterday.

Diverting traffic to other roads would likely lead to more accidents and fatalities, the study said. And it said higher truck tolls would hurt the economy because of costs passed on to consumers and time lost in moving freight on slower roads.

Many of the economic and social costs may not be considered in future leases or sales, especially when they are borne by people from states other than the one making the lease agreement, the study said.

"The monetizers, like Goldman Sachs, they're in a situation to make really big bucks," Belzer said. "And the politicians are not making rational decisions that they would make if they were using their own personal money."

The study concluded: "If the true problem is that political leaders are unwilling to face the voters with the reality that there is no free lunch, then . . . tolling and privatization will not solve the problem at all.

"In fact, our research suggests that it will only make the problem worse."