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Senator Morahan Praises State Comptroller For Urging Postponement Of Proposed Thruway Toll Hikes

 

New York State Senator Thomas P. Morahan praised Comptroller Thomas P. DiNapoli, who today released his audit of the State Thruway Authority and called upon the agency postpone its proposed July 2008 toll hike. The Comptroller's audit examined whether the calculations used in justifying proposed toll increases in July 2008, January 2009, July 2009 and January 2010 were accurate and reasonable.

"I commend State Comptroller DiNapoli for engaging in a comprehensive audit of the finances of the New York State Thruway Authority.His audit has identified several opportunities for the Thruway Authority to save significant dollars, which would allow them to run their operations more efficiently.Speaking on behalf of the hardworking commuters from my district, who travel on the Thruway on a daily basis, I applaud Comptroller DiNapoli's finding that toll hikes are not warranted until the Authority examines its own spending," said Morahan.

Morahan, who serves as the State Senate's Liaison to Executive Branch, has previously questioned the reliability of fiscal estimates projected by the Thruway Authority, and has called on the agency to reconsider proposed toll increases.

The Thruway Authority increased tolls five times prior to 2005: 1959, 1970, 1975, 1980 and 1988. Since 2005, the Thruway has already increased tolls twice and is proposing four additional increases. DiNapoli noted that while the recently implemented January 2008 toll increase might have been avoided, the proceeds of that toll increase are already legally pledged to pay for $2 billion the Thruway Authority has already borrowed.

The Thruway Authority Board is considering a series of toll increases that would take effect from July 2008 through January 2010. The board will be holding hearings on the proposed hikes. These proposed toll increases are expected to generate a total of $520 million in additional revenue. Thruway Authority officials say the revenue is needed to cover cash shortfalls projected over the next five years caused by a reduction in traffic growth and an increase in the use of E-ZPass discounts. Part of the revenue is also needed for the Thruway Authority’s $2.7 billion capital plan, which extends through 2011.

The review of the Thruway Authority’s finances found:

Significantly Underestimated Federal Funding: The Thruway Authority estimated that it would receive only $4.9 million in federal highway funding a year, even though its past average was $33.5 million a year. Auditors determined that the Thruway Authority could conservatively estimate an additional $125.3 million in federal funding between 2008 and 2012.

The Thruway Authority estimated that it would receive only $4.9 million in federal highway funding a year, even though its past average was $33.5 million a year. Auditors determined that the Thruway Authority could conservatively estimate an additional $125.3 million in federal funding between 2008 and 2012.

No Aggressive Cost-Cutting Measures: The Thruway Authority plans to limit its annual operating growth to 3.5 percent but has not implemented serious cost-reduction measures. Auditors found that current efforts appear to be geared towards maintaining current levels of spending rather than reducing costs. In the absence of a comprehensive, top-to-bottom analysis of Thruway Authority operating expenses, it is unclear whether waste, inefficiencies and unnecessary costs are being incurred and at what levels.

The Thruway Authority plans to limit its annual operating growth to 3.5 percent but has not implemented serious cost-reduction measures. Auditors found that current efforts appear to be geared towards maintaining current levels of spending rather than reducing costs. In the absence of a comprehensive, top-to-bottom analysis of Thruway Authority operating expenses, it is unclear whether waste, inefficiencies and unnecessary costs are being incurred and at what levels.

Uncollected E-ZPass Tolls and Fees: The Thruway Authority did not collect $27.5 million in unpaid tolls and penalties over a six-year period, according to a second audit also released today. While most of the delinquent motorists owed the Thruway Authority $20 or less, 82 violators (mostly businesses) owed $2,500 or more in unpaid tolls. One out-of-state trucking company was cited for 2,226 violations and owes $59,159 in unpaid tolls.

The Thruway Authority did not collect $27.5 million in unpaid tolls and penalties over a six-year period, according to a second audit also released today. While most of the delinquent motorists owed the Thruway Authority $20 or less, 82 violators (mostly businesses) owed $2,500 or more in unpaid tolls. One out-of-state trucking company was cited for 2,226 violations and owes $59,159 in unpaid tolls.

No Prioritization of Capital Projects: Auditors identified $160 million in non-essential capital projects, such as rehabilitating maintenance buildings, noise barriers and pedestrian bridges, that could be delayed to save money. The capital plan contains 300 individual projects but no effort has been made to prioritize these projects even though some are clearly less critical than others.

Auditors identified $160 million in non-essential capital projects, such as rehabilitating maintenance buildings, noise barriers and pedestrian bridges, that could be delayed to save money. The capital plan contains 300 individual projects but no effort has been made to prioritize these projects even though some are clearly less critical than others.

High Spending on Non-Thruway Operations: Since 1990, the Thruway Authority has spent more than $1 billion on non-Thruway operations such as the Canal System ($700.4 million) and mandated economic development projects ($61.4 million). Between 2008 and 2012, the Thruway Authority estimates it will spend nearly $395 million on the canal system alone.

Since 1990, the Thruway Authority has spent more than $1 billion on non-Thruway operations such as the Canal System ($700.4 million) and mandated economic development projects ($61.4 million). Between 2008 and 2012, the Thruway Authority estimates it will spend nearly $395 million on the canal system alone.

Canal Corp Revitalization Projects Over Budget and Behind Schedule: Another audit released today found that the Canal Corporation was $17 million, or about 49 percent, over budget and at least two years behind schedule on various community revitalization projects that are part of the Canalway Trail.

Another audit released today found that the Canal Corporation was $17 million, or about 49 percent, over budget and at least two years behind schedule on various community revitalization projects that are part of the Canalway Trail.

The three audits contain a series of recommendations including:

Perform a comprehensive, top-to-bottom analysis of operations to identify where costs can be reduced. This analysis should always be performed prior to any proposed toll increase.

Use a collection agency or some other means to improve the collection of delinquent E-ZPass tolls.

Evaluate the benefits of raising revenue through private sector advertising and sponsorship.

Include a reasonable estimate for future federal highway funding in funding projections.

Base all equipment replacement estimates on documented needs assessments.

Develop management reports showing the progress and dollars spent on each capital project.

Prioritize the projects in future capital plans to facilitate any adjustments needed in response to unanticipated funding shortages.

Identify the non-essential capital projects that are scheduled for 2008 through 2012, determine which of those projects can be deferred until after 2012, and determine how the Authority’s funding needs would be affected if the projects were deferred.

Document the basis for the inflationary increases in construction contracts.