Tube City Almanac

January 26, 2009

MFX: At Any Price?

Category: Commentary/Editorial || By

Jason Togyer photo(Part 2 of a series.)

(Editor's note: Danger, math ahead!)

. . .

A lot of Mon Valley residents have probably assumed that because the Mon-Fayette Expressway is a toll road, that tolls will pay the cost of the portion between Jefferson Hills and Pittsburgh.

To my surprise, it's not even close.

Based on some very unscientific calculations, it would be almost impossible to cover the costs of building the 24-mile stretch of the MFX through West Mifflin, Dravosburg, Duquesne and North Versailles by relying on tolls.

The rest of the cost will have to be subsidized by the taxpayers.

. . .

How much will the highway cost? The estimates keep going up.

Back in 2003, the cost of construction and property acquisition was estimated at $1.8 billion.

Three years later, the cost had jumped to $2.7 billion. It's no stretch to assume the cost is well more than $3 billion now.

Why so expensive? Although the existing 57 miles of the MFX passed mainly through unpopulated areas, the part of the MFX that goes through the Mon-Yough area would require hundreds if not thousands of homes and businesses to be purchased, bypassed or relocated at the expense of the Pennsylvania Turnpike Commission.

In fact, the 24 miles of MFX between the Parkway East and Route 51 in Large have frequently been called one of the most expensive highways ever planned, second only to the notorious "Big Dig" in Boston.

And that project required blasting a tunnel through one of the most crowded central business districts in the United States.

. . .

Tube City Almanac graphicHow much money would MFX tolls generate? First, we have to estimate how many cars and trucks will use the highway between Large and Pittsburgh.

For comparison's sake, let's look at traffic levels for the Parkway East and Interstate 279.

In 2006, according to PennDOT estimates, about 85,000 vehicles used the Parkway East between Swissvale and Monroeville every day. About 63,000 used I-279 north of Pittsburgh's city limits.

. . .

We'll split the difference and "guess" that 70,000 vehicles would use the Mon-Yough sections of the MFX every day.

(That estimate may be high. According to one report, about 20 percent of cars and 1 percent of commercial vehicles will avoid toll roads if free alternatives are available.)

Twenty-four miles of highway multiplied by 365 days multiplied by 70,000 vehicles gives us 613 million vehicle-miles per year --- assuming the MFX is busier than the Parkway East from Squirrel Hill to Monroeville.

. . .

Then we need to estimate how the tolls would be distributed between cars and commercial vehicles.

According to the Federal Highway Administration, trucks account for more than 30 percent of the traffic on one-fifth of the nation's interstates.

Giving the MFX between Large and Pittsburgh the benefit of the doubt, we assume that 30 percent of the 613 million annual vehicle-miles will be contributed by trucks.

Tolls on the existing sections of the Turnpike gross 7 cents per mile for passenger cars and 22 cents per mile for commercial vehicles, according to the Turnpike Commission's most recent annual report, dated May 31, 2008.

. . .

By that formula, commercial traffic would rack up 184 million miles per year at 22 cents per mile, or $40.5 million per year in toll revenue. Passenger car miles would amount to 429 million, or $30 million at 7 cents per mile.

As a result, we're "guesstimating" that the MFX through West Mifflin, North Versailles and the surrounding areas might gross $70.5 million per year if the tolls were kept the same as on the mainline turnpike.

Admittedly, all of our estimates amount to "SWAGs." But they seem like they're in the ballpark.

. . .

In fact, our projections may be too generous to the Pennsylvania Turnpike Commission. According to a June 2008 report by state Auditor General Jack Wagner, the entire Pennsylvania Turnpike system handled 5.7 billion vehicle-miles across its 537 total miles during fiscal year 2006-07.

Each mile of turnpike thus averaged 10.6 million revenue miles. Extending that average to the 24 miles of the MFX north of Large gives us about 255 million revenue miles --- a lot less than our estimate.

Also according to Wagner's office, passenger cars accounted for 86 percent of the turnpike's total traffic, not 70 percent, as we're assuming.

Commercial vehicles --- billed at the higher rate --- were only 14 percent of the traffic. That could make our revenue projections overly optimistic.

. . .

But let's be even more generous and assume that the MFX in Allegheny County would be wildly successful.

One of the busiest stretches of highway in the Pittsburgh area is the Parkway West between the Fort Pitt Bridge and Green Tree. It handles 129,000 vehicles per day.

Applying that traffic volume to the unbuilt 24-mile stretch of the MFX gives us 1.13 billion revenue miles per year.

And if the Turnpike Commission gets permission to turn Interstate 80 into a toll road, it wants to charge 8 cents per mile for passenger cars and 30 cents per mile for trucks.

So let's hike tolls on the MFX to that rate, which gives us annual gross toll revenues of $165 million.

. . .

If every single dime of that toll revenue was applied to the construction bonds it would take 18 years just to pay off the $3 billion in principal. We wouldn't have any money left over to pay the interest or any operating expenses, like maintenance and toll collection.

And again, that's assuming that every inch of the MFX is as busy as the Parkway West, which seems unlikely. (It's hard to imagine the stretch from Large to Clairton seeing 120,000 cars per day.)

Using our less generous estimate --- "Parkway East" levels of traffic --- the numbers are much uglier.

If the 24 miles of MFX cost $3 billion to build, and they generated $70.5 million in revenue, and every dime of toll revenue was put toward the debt service, it would take 42 years to pay off the principal.

Our highway still doesn't have any maintenance department, any toll collectors, or any means to pay for those overhead expenses, and we also haven't touched the interest payments on the money we've borrowed.

Naturally, the numbers get progressively worse as the traffic levels go down.

. . .

If these "back-of-the-envelope" guesstimates are accurate, there is no way that the MFX in the Mon-Yough area could be built without massive taxpayer subsidies.

Here's a big surprise --- even the MFX's supporters agree!

In 2004, a report by the Allentown Morning Call quoted Joe Kirk, former executive director of the Mon Valley Progress Council, as saying that tolls would only cover 25 percent of the cost of building the Mon-Fayette Expressway.

"The balance will have to come through grants, taxes, new fees or additional borrowing," noted the Morning Call, whose headline labeled the highway a "black hole" for tax money.

But what about the "public-private partnerships" that Gov. Ed Rendell and the Turnpike Commission have touted?

Unfortunately, those seem to benefit the "private" side of the partnership a lot more than the "public" side.

. . .

(To be continued.)

Your Comments are Welcome!

Over the last 25 years, I’ve worked all four points of the Pittsburgh periphery (Monroeville, Cranberry, Robinson and Southpointe). I’ve worked in big office buildings and in sprawling industrial parks. But the common feature to all of those locations has been ACCESS. The development in every one of those locales was made possible by new highway construction.

Although the other highways preceded my arrival, I was already working in Cranberry just a few weeks before the Parkway North opened. In addition to cutting my commute time significantly, the effect on local business, home construction and TAX REVENUES was unbelievably dramatic. By the time I left in 1995, development was completely out of control. Seneca Valley students were changing school buildings DURING the school year, and Rocco Viola razed every tree on every acre that he owned in order to circumvent pending zoning ordinances designed to control the explosive growth.

Would that we in the Mon Valley should have such problems.

I’ve been waiting for an expressway link to the McKeesport area since they tore down Rainbow Gardens to build one. Right now, I pay $1.25 to ride the MFX 6.5 miles from Large to Finleyville on my way to Southpointe. It saves me 12 minutes and reduces the wear and tear that climbing Ridge Road and descending Stone Church inflict on my car. The proposed connector from 43 to 79 will turn my 50 minute commute to maybe the shortest one I’ve ever had in my life (I need it, believe me!)

When I attended my first MFX planning meeting at Finleyville J.H.S back in 1998, I met Lou Washowich at the door and figured McKeesport would benefit from his city affiliation.

The route that seems finalized now won’t do McKeesport a lick of good unless the two portals into the city are upgraded. The Mansfield bridge corridor, via tenth ward is atrociously inefficient. The Duquesne bridge side is already overcrowded, and the renovations that’re going on now will do nothing to increase capacity.

The money stream will consist of more than tolls, taxes and grants. In Field of Dreams, the motto was“If you build it, they will come.” In today’s urban growth model (as evidenced by the thriving development in Robinson, Monroeville, Cranberry and Southpointe) the motto is “If they can come to it, they will build.”
RD350c - January 27, 2009

“In today’s urban growth model (as evidenced by the thriving development in Robinson, Monroeville, Cranberry and Southpointe) the motto is “If they can come to it, they will build.”

hmmm … faith-based highway planning?
B.S.D. - January 27, 2009

“Current” (as of 1 year ago) cost estimates for the Y-shaped Pittsburgh connector = $3.8 billion (, so you’re only slightly under the mark.
Andrea Boykowycz - January 27, 2009

... ok, so Jason informs me the rest of what was a pretty long comment was lost to the ether somehow, and I must re-create everything I wrote after that opening sentence, above. Er – I think this is about what followed:

Also n.b., in the Environmental Impact Statement for the 51-I376 leg the Turnpike estimated ridership of 50,000 vehicles per day. So my back-of-the-envelope math says that a $3.8 billion 30-year bond at 5% interest would cost $247+ million/year in principle and debt service — which means that 50,000 vehicles per day 365 days per year would have to earn the Turnpike an average of $13.54 per trip. Only ~10x more per mile than we pay right now on the mainline. :)

An interesting note about that 50,000/day estimate: even if it were low (which would just beggar imagination, since the population estimates they used to calculate it were just delusional), the Turnpike couldn’t really raise it, since a big part of their argument in the EIS is that the project wouldn’t induce any new traffic. They’re proposing the MFX connection to Pittsburgh just to siphon existing traffic off I-376 and the state highways. (Someone should alert the MVPC and RCA about that — where is the new business supposed to fit into that model?) So they can’t really come back and say they’re adding new traffic to the city, since there’s no infrastructure to support that kind of added traffic burden.

And then, we have no details about the “statements of interest” that the Turnpike just got from 3 financial consortia interested in a public-private partnership to build the thing out, but I would be VERY surprised if any of the statements contained any interest about any section other than the so-called Squirrel Hill Tunnel bypass, since that’s the only segment for which the ridership estimates pass the straight face test. Again — someone alert the Mon Valley guys who’re shilling for this project that they’re greasing the wheels for the Monroeville CoC, not Duquesne or Clairton.

New federal money for this project would basically just be a big albatross around Brimmeier’s neck, since it would mean re-starting the whole NEPA process with new air quality standards that the project would find it very, very tough to meet. Even just making the argument to the feds would cost them at least a year and a bunch of millions. So I can’t imagine the Turnpike is really jazzed about the idea of looking for a new earmark from Washington for this.

AND – Jason I hope in the next segment you’ll take a look at the railroads in the path of the MFX ROW — there’s no power on earth that can force them to cede an inch to the Turnpike and they have no incentive to even negotiate, so I’m wondering how the alignment is supposed to be workable.
Andrea Boykowycz - January 27, 2009

Oh, and as to why the project is so effing expensive — it’s actually not really about the property values in the right-of-way, it’s the technical difficulties of building a new bridge over the Mon, hugging the river and the crumbly hillsides, sinking the road below grade through Hazelwood, building huge fly-overs, carving away a good 1/3 of the hillside over the Glenwood Bridge, and operating within the tight constraints of dense urban settings. It’s a pretty torturous alignment. Plus the costs of construction and construction materials have skyrocketed over the past several years. Al Biehler has a great powerpoint presentation about what effect the spiraling construction costs have had on the value of PennDOT’s budget dollars — the Turnpike is subject to the same economics.
Andrea Boykowycz - January 28, 2009

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