85-Mph Toll Road Revenue Falls Short

SAN ANTONIO (AP) - A billion-dollar Texas toll road with an 85 mph speed limit -- the fastest in the nation-- has drawn about half the number of drivers expected in its initial months of operation, a performance low enough that the private company that built it is facing a downgraded credit rating, according to Moody's Investor Service.

The Texas 130 toll road extension generated almost $2.6 million in toll revenue in the first six weeks that the road was opened in late October, according to state records obtained by the San Antonio Express-News (http://bit.ly/141lFg4). At least 202,861 vehicles traveled on some part of the road during that time period. The extension is located in a largely rural area between Interstate 10 in Seguin and a road south of Austin.

Moody's announced March 15 it is investigating a possible downgrade of the credit rating of the SH 130 Concession Co., which spent $1.4 billion to build the toll road extension and will operate and maintain it for the duration of a 50-year lease with the state.

The report also indicates the company could struggle to make future debt payments if traffic revenues do not increase. Part of that debt is a $430 million federal loan.

The SH 130 Concession Co. is made up of Spanish-based Cintra and San Antonio-based Zachry American Infrastructure. Although the operating history of the toll road is limited, the shortfall was so significant that Moody's said it warrants a review.
It was unclear what the revenue and traffic volume expectations were for the toll road extension during the time period for which records were requested by the San Antonio Express-News. It also was unclear whether a downgraded credit rating could increase the cost of borrowing for the firm.

Chris Lippincott, spokesman for the SH 130 Concession Co., said he could not comment on the revenue and traffic numbers released by TxDOT, adding the numbers had yet to be audited or on any traffic and revenue projections.
The San Antonio Express-News obtained the Texas 130 revenue and traffic count information through an open records request, originally submitted to the Texas Department of Transportation on Dec. 31.
Release of the information was delayed after the concession company argued with the Attorney General's Office that the information should be exempt from disclosure because it constitutes trade secrets, the release of which could cause competitive harm.

The attorney general ruled against the company March 20. TxDOT did not release the information until Friday.
The Texas 130 extension connects to an original section of the toll road that runs from Georgetown to Mustang Ridge. The state built that part of the road, known as segments 1 through 4. It also maintains these northern segments and collects all of the toll revenue.

But when the state came up short on money to finish the road, from Mustang Ridge to Interstate 10 in Seguin, the private sector stepped in and built the extension, known as segments 5 and 6.
As a part of an agreement with TxDOT, the concession company, besides paying $1.4 billion in construction costs and other incentives for the project, also shares a percentage of the revenues with the state.
The SH 130 Concession Co. received $2.2 million in toll revenue between Nov. 11 and Dec. 31.
TxDOT can't say definitively how many vehicles total used the entire extension.

Generally, the Moody's report said southbound traffic seems stronger, which may make sense because those trips might draw drivers coming from the Austin area.

In March, shortly after the Moody's report was released, the Texas Transportation Commission voted to reduce toll fares for an entire year for trucks using the entirety of Texas 130, from Georgetown to Seguin, and on State Highway 45 SE, as a way to generate more traffic on the road, envisioned as an alternative to Interstate 35.

Lippencott said he couldn't say if traffic numbers are increasing on the Texas 130 extension but added that more drivers will be drawn to the road as public awareness increases, connectivity to the road improves and financial incentives, like the truck discount, are adopted.

"Until we have traffic jams, we have room for more cars," he said. "We have yet to have a traffic jam."

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