Private Tollway Gets Going : Wilson, at Groundbreaking for Riverside Freeway Project, Calls for Expanding Concept Statewide

Gov. Pete Wilson, attending the groundbreaking in Orange County of the nation’s first privately owned and operated toll lanes in 50 years, called for expansion of the private road concept throughout the state.

“We will continue to seek partners for similar projects,” Wilson said at a sand-and-shovel ceremony in Yorba Regional Park, alongside the crowded Riverside Freeway. Construction began late Tuesday for two toll lanes in each direction on the 10-mile dirt median on the Riverside Freeway between the Riverside County line and the Costa Mesa Freeway.

“This is the beginning of what is not lightly described as an historic project,” Wilson told a crowd of dignitaries under a green and white banner that proclaimed “New Roads, No Tax Dollars, New Jobs.”

The so-called express lanes will be built and operated by a limited partnership known as California Private Transportation Co., headed by Omaha-based Peter Kiewit Sons Inc. The lanes will also incorporate the world’s first totally automated tollway for regular commuters, according to state and federal officials.

One consultant predicted the company would make “money hand over fist” from its approximately $125-million investment. Authorized as one of four experimental private toll road projects by state legislation in 1989, the California Private Transportation Co. three years ago received a 35-year franchise to build and operate the road. It is expected to open in 1995.

Under the contract, the company uses its own partners’ funds and loans from banks to build the toll lanes. The taxpayers’ only involvement, besides limited review of the plans by the California Department of Transportation, is to provide the median strip as free right of way.

In return for building and operating the toll lanes, the firm is entitled to collect and keep the tolls during the 35-year franchise, which begins when the tollway opens to traffic. When the franchise expires, the road becomes the property of Caltrans. During the life of the franchise, the company will reimburse the state for Highway Patrol and maintenance expenses.

Orange County has another private toll road in the works--an extension of the Orange Freeway from the interchange of the Orange, Santa Ana and Garden Grove Freeways down the middle of the Santa Ana River to Costa Mesa. It would be built on stilts. The Perot Group of Texas is now shepherding that project through the environmental review process.

Three other toll roads are being built in south Orange County, but they will be publicly owned and operated.

In applauding the concept of private toll roads, Wilson said the Orange County project “will create jobs in the private sector. It will ease the strain on what is one of our most congested highways. And it will do this at no cost to the taxpayers.”

It was the second visit to Orange County in a week by the governor, who faces reelection in little more than a year and whose popularity is suffering, according to public opinion polls.

Wilson was also expected to announce his support for new legislation aimed at eliminating the state’s four-project limit on private toll roads, but the governor’s aides said the effort simply wasn’t ready to go and will be launched in the next legislative session.

Gerald Pfeffer, managing director of California Private Transportation, said Tuesday that he’s confident the Riverside Freeway project will earn a profit, but he declined to specify the expected rate of return on investment.

“There are more than 250,000 cars per day going through the interchange with the Costa Mesa Freeway,” Pfeffer said. “Traffic forecasts for the year 2010 range up to 400,000. We think this project has great potential financially, or we wouldn’t have come to this point. . . . But somebody had to be first. No one has ever done this before.”

“This is a big day for me,” said Robert Poole of the Reason Foundation, a pro-privatization, Santa Monica-based think tank that was an early advocate of this road and the private toll-roads experiment authorized by the 1989 law. “I had to get off jury duty to be here, but I wouldn’t have missed it for anything. . . . CPTC is going to make money hand over fist from this.”

Motorists who intend to use the lanes on a regular basis will deposit funds into a credit account that will be debited after each trip. Transponders aboard each vehicle will communicate with roadside scanners connected to a computer system. Designers are still discussing how to bill the occasional user. License plates will be photographed to catch freeloaders.

Asked if he was concerned about motorists’ potential loss of privacy from the cameras, Wilson gave an emphatic, one-word answer--”No.”

Tolls will be $2 each way during peak traffic hours, but passage will be free to car pools of three or more people, motorcycles, disabled veterans and the handicapped, as well as electricity-powered or “zero-emission vehicles.”

The project is expected to create 150 temporary construction jobs and 180 permanent jobs.

The toll lanes will be the nation’s first test of so-called congestion pricing, in which tolls are varied according to traffic conditions and time of day. The off-peak toll will vary according to traffic conditions.

Not everyone is pleased with the project, however. Riverside County officials fought it for two years, arguing that it would be unfair to Inland Empire residents who are already paying a local sales tax to add car-pool lanes to the median of the Riverside Freeway east of the Orange County line.

Riverside County officials were invited but most apparently didn’t attend Tuesday’s groundbreaking.

Bank financing for the Riverside Freeway project totals $65 million, provided by Citibank, Banque Nationale de Paris and Societe Generale, both based in Paris.

The bank notes must be paid off in 10 to 15 years, officials said. Another $35 million is being provided through institutional financing, with $19 million plus additional emergency funding commitments coming from direct investment by the partners in California Private Transportation--Kiewit, the Cofiroute Corp., based in France, and Granite Construction Inc., based in Watsonville. The Orange County Transportation Authority has provided $6 million, which must be repaid.

High-Tech Highway The first privately owned and operated toll road built in the country in 50 years is expected to alleviate congestion on the Riverside Freeway in Orange County. There will be no toll booths. Instead, regular commuters will be billed automatically by a computer. LABELS 2 toll lanes 4 normal lanes 1 car-pool lane Sign displays fare, which changes depending on congestion Control center Smart Road Cameras monitor traffic Road managers decide whether to raise or lower tolls Rush-hour toll will be $2; non-rush hour toll is less Car pools with three or more occupants drive free Automated Toll Collection 1: ID card attached to rearview mirror 2: Motorists with cards decide whether to enter toll lanes 3: Sensors tell control center a car has entered lane 4: Overhead sensor reads vehicle’s ID card 5: Vehicle’s identity relayed to control center; computer deducts toll from driver’s prepaid account 6: Cameras record license numbers of cars without ID cards; violators are stopped by police or ticketed by mail Fast Facts Length: 10 miles Cost to build: $125 million Construction: Groundbreaking ceremony held Tuesday; expected completion late 1995 Source: California Private Transportation Co.; Researched by CAROLINE LEMKE / Los Angeles Times