Sources of Revenue:

Other Fund Turnpike Toll Revenues

Legislation creates:

Neither Program nor Fund

Fiscal Note Summary

Effect this measure will have on costs and revenues of state government.

This bill does not affect the general revenue of the State of West Virginia. The West Virginia Turnpike is operated and maintained by the Parkways Authority with Turnpike toll revenues paid by the users of the highway. Thus, no State tax or general revenue dollars are used in the maintenance or operation of the Turnpike or in paying debt service on Turnpike bonds issued by the Authority. However, if the Parkways Authority is terminated after re-payment of the bonds, the State of West Virginia would lose in excess of $50 million annually in toll revenues used to operate and maintain the 415 lane miles of Interstate highway, 116 bridges, three travel plazas and one welcome center. The majority of this annual toll revenue comes from out-of-state passenger and out-of-state commercial patrons (approximately 76% of all Turnpike revenue). Pursuant to West Virginia Code §17-16A-18, the West Virginia Division of Highways (“DOH”) would be required to maintain and operate the Turnpike with no toll revenues forthcoming. In its 6 Year Highway Improvement Program, DOH points out that it is severely underfunded to maintain the 36,000 miles of road and 6,800 bridges in West Virginia. In addition, DOH is projecting a decline in revenues from gas taxes through 2011. Turnpike tolls free up scarce state transportation dollars to maintain other roads and bridges in West Virginia. The Interstate system, authorized in 1956, is approaching the end of its useful life and is in need of massive rehabilitation and rebuilding. If the Turnpike and tolls were terminated, DOH would immediately be faced with a 55 year old highway and critical capital needs. In order to maintain the Turnpike at a safe performance level and a level of service that should be given to the public, $238 million is needed over the next five years in capital and renewal and replacement needs. Less than $60 million is currently projected to be available over the next five years, leaving over $178 million in deferred projects.

Fiscal Note Detail

Effect of Proposal	Fiscal Year
Effect of Proposal	2009 Increase/Decrease (use"-")	2010 Increase/Decrease (use"-")	Fiscal Year (Upon Full Implementation)
1. Estmated Total Cost	0	0	0
Personal Services	0	0	0
Current Expenses	0	0	0
Repairs and Alterations	0	0	0
Assets	0	0	0
Other	0	0	0
2. Estimated Total Revenues	0	0	0

Explanation of above estimates (including long-range effect):

Memorandum

During the 2006 session of the Legislature, Senate Bill #557 was passed that said the Parkways Authority cannot issue bonds for construction improvements, enlargements or extensions. The bill mandated that existing bonds can be refinanced, but with no additional principal and no extension of maturity. The Authority cannot finance acquisition of real property. Therefore, all references in this bill to changes in the Parkways Authority’s ability to issue bonds have been recently addressed by the West Virginia Legislature. In addition, West Virginia Code §17-16A-18 says the following: Cessation of tolls. (a) Except as provided herein, when all bonds issued under the provisions of this article in connection with any parkway project or projects and the interest thereon shall have been paid or a sufficient amount for the payment of all such bonds and the interest thereon to the maturity thereof shall have been set aside in trust for the benefit of the bondholders, such project or projects, if then in good condition and repair to the satisfaction of the Commissioner of the state Division of Highways, shall be transferred to the state Division of Highways and shall thereafter be maintained by the state Division of Highways free of tolls. Therefore, the provision of House Bill 2632 to transfer the duties and responsibilities of the Parkways Authority to the Division of Highways is already in the State Code.

Person submitting Fiscal Note: Gregory C. Barr
Email Address: gbarr@wvturnpike.com