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To Eliminate Tolls
It has been generally proposed that we substitute another source
of revenue to pay for the bridges and eliminate the tolls which tend
to be bottlenecks of the transportation system.
This is legally impossible under the 1963 Bond Indenture without
approval of 100% of the present bondholders, a practical impossibility.
It is likewise impossible to refinance the bond issue using an
alternate source of revenue since the State Constitution permits the
full faith and credit bonds to be financed only by tolls and a pledge
of the second gas tax. The Florida Constitution would have to be
amended and new State Statutes enacted.
As of today, the only practical way to eliminate tolls would be to
refinance the existing state bonds with bonds backed by the full faith
and credit of the City. The only major source of revenue available
for bonds besides the tolls themselves would be ad valorem taxes and
revenue sharing funds. Alternate sources of revenue may become
available through future state legislative action.
Refinancing the outstanding bonds under existing interest rates
would be extremely expensive. The average interest rate of the 1963
Bond Indenture is 4.05%. It is expected that the comparable interest
rate of a full faith and credit state bond would be 5 1/2%. The affect
of refunding a 5 1/2% bond would mean that a bond backed by a 25 cent
toll would bring only 156.9 million dollars as contrasted to 171.5
million for a parity bond, a loss of almost 14.5 million dollars. A
bond backed by the full faith and credit of the City would have an A-1
rating for approximately 5 3/4 to 6% interest. This would bring even
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further reduction of the bonding capacity at no savings to the toll
payer.
As publically popular as the elimination of tolls may be, the
existing legal restrictions and the financial high costs make it
extremely questionable whether to attempt to refinance the 1963
Bond at the present time. It is doubtful that the City would be
willing to substantially increase the property tax burden in order
to eliminate tolls or that the people would vote for such a
proposal.
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Parity, Refinanced or Junior Lien Bonds
There has been much speculation about the appropriate method of
bond financing under theexisting condition and the relationship of
the 1963 Bond Indenture to any future indentures.
The relative difference in bonding capacity among parity, re-
financed or junior lien bonds was most comprehensively demonstrated
in a handout from the JTA which is included in this report. The
procedure for calculating the ultimate cost in bonding capacity
for a 15 cent, 25 cent and 35 cent toll for each method is demon-
strated with the resultant amount in final bonding capacity. As
indicated by the handout, the loss of revenues from a parity bond
to a junior lien bond, to a refinanced bond for a 25 cent toll
would be 171.5 million to 164.0 million to 156.9 million dollars.
These bonds would be full faith and credit bonds of the State.
Any bond which is local in nature would of course have a sub-
stantially lower bonding capacity.
To quote Mr..Frank Watson and the other eminent bond attorneys
which looked into questions of bond financing for the Ad Hoc Committee:
"It is our opinion that under existing laws the presently proposed
plan of issuing parity bonds backed by the full faith and credit
of the State will result in the lowest cost and will be in the
best interest of our community.
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Priorities
In.January, 1973, the Jacksonville Transportation Authority
indicated bonding needs of from $281-321 million dollars for
expressways and bridges over the next five years. The existing
25e toll will only raise $170 million dollars at best estimate. The
resultant loss of toll revenues from the energy crisis could reduce
this figure much further. One must consider priorities when one
considers the possible 150 plus million dollar gap of what the JTA
says we "need" and what we can presently raise.
The Jacksonville Transportation Authority has indicated that
they rely on the Jacksonville Urban Area Transportation Study (JUATS)
for a master plan with priorities which they then reconcile with the
realities of available funds, environmental, legal, and other
practical consideration in their decisions.
The JTA has no official priority list, but a series of on-
going projects from which priorities will be drawn for construction.
This is necessary since, at any one time, a major project may,become
environmentally unfeasible and it would be necessary to shift to another
proposal.
Master transportation plan and official priorities are deter-
mined through JUAT's technical coordinating and policy making committees.
The latter is composed of individuals representing community bodies
including the Mayor, the Co-Chairman of the Legislative Delegation and
the President of the City Council. The responsiveness of the trans-
portation plan.to the people is of course determined by this body.
At present, there is only a tentative master plan with tentative
priorities. Until the Jacksonville Urban Area Transportation Study
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presents a final report, and until the Jacksonville Transportation
Authority indicates its priorities based on that report, the Committee
will not make a final recommendation.
The Committee would reiterate that the existing energy crisis
will substantially alter the transportation needs of the City. In so
far as the major effects will not be felt until next year, the specific
impact on the bridges, their need and revenue sources for them, cannot
be predicted at this time.
However, priorities should be carefully considered to determine
whether the City is moving to meet existing needs, or projecting
toward future growth. In so far as public support ia a prerequisite
for effective governmental action, it is the Committee's strong
recommendation that existing needs should take higher priority than
planned future needs.
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Alternate Proposals
Many innovative and intelligent proposals were made from a variety
of citizens in the midst of the toll increase crisis'. Most of these were
well intentioned suggestions aimed at alleviating the congestion which
existed at the toll facilities during peak rush hour traffic as well
as spreading the burden of financing our transportation system more
equitable among all citizens. Due to the lack of staff and resources
this committee could only deal with a relatively few suggestions which
were either publically proposed by a public official or which seemed
to have widespread popular support. A few of these other suggestions
and committee comments are presented below in abbreviated form.
(a) The JTA should place tolls on all bridges. This would force all
persons who cross the river to pay tolls. equally as well as eliminating
tolls either going in-town, thus relieving traffic congestion at least
once a day, either in the morning or in the afternoon. This suggestion
was not followed by the JTA because of the difficulty of placing tolls
on these bridges and the additional congestion that would be produced
particularly on the Main Street Bridge which handles more traffic
than any other bridge.
(b) The JTA should place tolls on roads built or improved throughout
Jacksonville so that everyone would share the burden of our trans-
portation system. There are few toll improved roads on which it
would be economically feasible to place toll booths. The costs of
construction and operation of toll facilities are high, and most
drivers could avoid paying tolls by short detours on parallel streets.
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Most significantly, toll facilities presently create the bottlenecks
of our system, and most citizens would not want the additional traffic
delay and congestion now existing on our bridges to be spread throughout
the City.
(c) If we have tolls on the Fuller Warren and Trout River Bridges which
are part of the interstate system, why not place tolls on the Buckman
Bridge and the rest of 1-295 as well as 1-10 and 1-95. The Fuller
Warren Bridge and the Trout River Gridges, as a part of the Jacksonville
Expressway System, were already being built when the Interstate Highway
Act was implemented. While being a part of the interstate system (1-95)
they were grandfathered in as toll facilities. Although it is against
the law to place a toll on the interstate system, existing toll
facilities which-are later designated part of the interstate system
retain their toll facilities until paid for. An example of this is the
New Jersey Turnpike which is part of the interstate system but having
been built with toll bonds, it maintains its toll facilities. Tolls
may be placed on roads leading to interstate highways such as Roosevelt
Boulevard but they may not be placed on the Interstate Highways built
by Federal funds.
(d) Why not issue voluntary license tags? It is felt by many that we
could facilitate the flow of traffic by issuing voluntary license tags
for a year which could be purchased by the commuter once a year. This
has been done on county funded bonds, but we are not aware of similar
State projects. It was the opinion of the Committee that this approach
would create substantial problems under the Florida Constitution and
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1963 Bond Indenture. Some testimony indicated, with the approval of the
traffic engineers, the 1963 Bond, a voluntary license tag might be
feasible. The Committee would recommend the JTA to,look into this
matter further.
(e) It has been suggested that commuter tickets are discriminatory
against those who do not travel the bridges often and that by having
one single toll without tickets, the traffic congestion can be relieved.
While Ithe concept of a single toll has merit as to the administration of
the collections, the single toll at 20 cents would bring in insufficient
revenues for the major construction which the JTA says is necessary.
The 20 cent toll would bring in around 134 million dollars, which
approximates the cost of the Dames Point Bridge.
(f) It has been seriously recommended that the Jacksonville trans-
portation Authority reduce tolls until the 1974 Legislature has time
to act and possibly provide alternate sources of revenue. It is con-
tended that this delay will not substantially affect the total value
of bonds since one year's revenue at 25 cents would still be available
in July, 1975.
The testimony before the Committee indicate d that two years
of revenue would be necessary in order to get an optimum bond rate.
The executive director of the JTA estimated the total capacity of
the bond could be reduced as much as 30-35 million dollars by
averaging the expected toll revenues from one year at a fifteen cent
toll and one year at a 25 cent toll.
City Officials'also stated publically that at least two year's
revenue experience was necessary and the tolls would be increased as
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soon as possible if the JTA expected to issue the bonds in 1975.
Any delay in raising the tolls would result in a bonding capacity
loss of approximately twenty million dollars a year based on a
construction cost inflation rate of approximately 1% a month on
a 170lmillion construction project.
Since the Committee never received any testimony in rebuttal
to the anticipated loss of total bonding capacity caused by a
delay in raising the tolls, and since successful legislative action
providing alternative revenue sources is speculative, it is the
Committee's opinion that the Jacksonville Transportation Authority
acted upon the best advice available at the time of their decision.
Recommendations have been made to allow reduced fares for car
pools or cars with three or more occupants as is done in San
Francisco. While this is an excellent recommendation to reduce
traffic congestion, the terms of the 1963 Bond Indenture would
prevent this.
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Additional Funds
Toll revenues from the 15$ toll under the bond indenture are pledged
to various categories according to a pay back sequence. Toll revenues
from the bridges must first go to paying (a) interest (b) principal
(c) the purchase of 10% extra bonds, (d) the operating costs of DOT
(e) 30% extra bonds (f) DOT maintenance and finally (g) new con-
struction projects.
At the previous toll rates, toll revenues were expected to start
paying back DOT maintenance costs of the toll structures in 1980. Under
the new 25e toll, the revenues will begin paying DOT maintenance costs
in January, 1974, and perhaps complete back payment of maintenance
costs by July of 1975. DOT has committed between 4 1/2 and 4 3/4
million dollars of maintenance under the 1963 Bond Indenture. The
4 1/2 million dollars paid back by the 25d toll, will revert to DOT
fund for expenditure as it chooses.
As soon as exact accumulated maintenance costs are established,
the JTA intends to make a formal request that these funds be returned
to Duval County and spent by the DOT on new construction in Jacksonville.
The Committee strongly recommends that the Duval Delegation exercise
its influence to insure that DOT spends this 4 1/2-4 3/4 million
dollars in Duval County. This is an early windfall for the DOT because
Duval County is moving forward to meet it's own needs. We feel that
this money should remain in Jacksonville to help those who are helping
themselves.
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Florida's Highway and Street Construction Needs 1972-1990
Jacksonville's road and highway needs are set forth in the DOT's
Florida's Highway and Street Construction Needs 1972-1990. This
presents a composite picture of the highway and road needs of Jacksonville
to 1990 in five year spans. These projected "needs" are carried over
in the proposal for a new method of distributing the "primary gas
tax" by the DOT.
This document upon which the DOT makes it's decision is at least
three years out of date. It does not reflect the location of Off-
Shore Power Systems in Jacksonville and the effect that this will have
on our transportation needs. Just as Disney World had a major impact
on the transportation needs of Central Florida, OPS will have a major
impact on Jacksonville. Itylikewise does not reflect the views of
the Jacksonville Urban Area Transportation System nor the Jacksonville
Transportation Authority as to the transportation needs of the City.
This document shows Jacksonville's needs (1972-1975) at 82.7 million
dollars while JTA has estimated our needs (1973-1978) at between 270
and 320 million dollars.
It is imperative that the Department of Transportation be totally
informed as to the up to date needs and plans of Jacksonville. We
recommend to the JTA and our local district engineer to make every
effort to have the DOT up-date their document immediately to reflect
a realistic view of the transportation needs of this county. We* also
recommend to the Department of Transportation that if this is to be
used for the future funding of the primary gas tax, that it be up-
dated bi-annually.
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A Study of Transportation Fund Distribution (1973)
A study of transportation fund distribution (1973) is being
circulated by the Division Of Planning and Programming of the
Department of Transportation. This is a proposal to amend the
distribution of the Primary Gas Tax, Policy Number 049, by up-dating
it.
It is imperative that the Duval Delegation be fully informed
as to the practical implications of all proposed changes so that we
may present our recommendations to the Department of Transportation.
Whild. today's report considers some of the proposals, the Ad Hoc
Committee does not have the capacity to fully analyze the entire
document.
The Committee therefore recommends that the Jacksonville Trans-
portation Authority make a full study of "A Study of Transportation Fund
Distribution", (1973) and make a written report to the Co-Chairman
of the Delegation including recommendations of the JTA as to what
course of action the Duval Delegation should take.
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