On May 21, 2020, Samuel Johnson, interim Chief Executive Officer of the Transportation Corridor Agencies’ (TCA) and President of the International Bridge, Tunnel and Turnpike Association (IBTTA), joined four of the nation’s top transportation leaders to brief more than 50 journalists from across the country on the effects of COVID-19 on the nation’s transportation network. Following is a full, official transcript of Johnson’s remarks. View the State of U.S.Transportation During COVID-19 Pandemic Virtual Press Briefing here.
“Alright, thank you, Pat. I would also like to extend my thanks and my gratitude to all those who are doing everything they can to keep us safe, keep our families safe and keep our communities safe as we go through this challenging time in our history.
The Transportation Corridor Agencies are two joint powers authorities responsible for planning, financing, constructing and operating the largest network of tolled facilities in the state. Comprised of four facilities, providing 51 miles of highways in Orange County, California, The Toll Roads were constructed as alternatives to Interstate 5 and Interstate 405, which are two of the most heavily used and congested corridors in the country.
Built with non-recourse toll revenue bonds, what has been accomplished here is an amazing story of self-reliance. Devised, implemented and managed by our local cities and county districts, our plan has been hugely successful in making Orange County an economic engine and great place to live.
Using an all-electronic tolling model, we would typically carry about 40 percent of South Orange County traffic during peak periods. Prior to the pandemic, The Toll Roads were experiencing double digit growth in traffic, with highs of approximately 350,000 transactions per day and opening nearly 1,000 new accounts for customers per day.
On the first weekday in March of this year, nearly 300,000 tolls were collected on The Toll Roads. Our monthly revenue was up more than 11 percent compared to last year and TCA was quickly on its way to having two million accountholders, more than two-fold the number of accounts we had just four years ago.
When the pandemic was announced, TCA, like many of our agencies, took immediate steps to protect our people and our customers. We closed our walk-in center and, a week later, we closed our building and adopted a mandatory telework policy. Within a few days, we had completely transformed our work model and operational procedures to combat and comply with the state’s effort to flatten the curve during the pandemic. Then, California became the first state in the country to issue a stay-at-home order to combat the challenges we were facing.
On The Toll Roads, our traffic numbers, like many, were drastically affected. Our transactions and revenue dropped to 70 to 80 percent on our facilities, and this was similar to what we saw in other parts of the county in terms of impacts to non-tolled roads and transit. From a health perspective, this was positive in keeping people safe, but it definitely created economic challenges for our customers and our business.
We have taken steps to address these challenges by offering customers more time to pay, pausing our delinquent violation processes and tightening our expenditures to our core business needs and our Boards’ priorities. We are making sure during this time that we communicate with our community in ways that express our public agency priority on health and welfare while also ensuring that our TCA family members know we are concerned with their physical and mental well-being. This is especially important as California takes steps toward economic recovery and TCA now makes plans for a slow transition to reoccupy our building.
Our Boards have emphasized we exercise a lot of care for our people and our business as we move forward. While our past financial success and debt management strategy has placed us on solid ground, the unknowns of this challenging time warrant conservative fiscal approaches. Even though we are already seeing some of the recovery with our traffic and revenue declines only around 50 to 60 percent as compared to the previous year, we want to be very cautious.
For TCA, this will result in an operations and capital budget for next year that is about 51 percent (or $78 million dollars) lower than the current year. Our Boards’ critical priorities for about $300 million dollars in regionally beneficial projects will still move forward as originally scheduled but others are being deferred to the future. This gives us a solid fiscal path forward, but means we will not be doing quite as much to support our economic recovery.
This is where we hope the federal government can support the tolling industry, not as a means of rescuing agencies but as part of the economic boost that investments in transportation infrastructure always provide. The user-financed transportation model is a viable long-term solution and the tolling industry stands ready to rise to the call with our ability to bring private investment to the table.
The support we need from the federal government can come in various forms as highlighted in the letter that IBTTA put forth to Congress. Anything that can be done to infuse capital into transportation should be open for discussion, whether that be direct funding, improvements to expedite or increase access to TIFIA or regulatory changes that allow agencies to better manage existing debt. These are tools that should be contemplated.
We all know there are brighter days to come and our transportation system will be just as vital to our economy and safety as it always has been, even in what may be the “new normal.” So, we need to make these investments now and I know our transportation industry is prepared to step up. Thank you, Pat.”