Senate may step into I-77 toll lanes dispute after AG turns away opponents

Credit: NCDOT

 

Credit: NCDOT

Credit: NCDOT

RALEIGH — Opponents of the I-77 toll lanes are stepping up their efforts, gathering business leaders to descend on Raleigh tomorrow and speak against the project. There is speculation that they will also announce that Sen. Jeff Tarte (R-Charlotte) plans to introduce legislation to de-fund the project. The event comes a week after the group sent N.C. Attorney General Roy Cooper a letter asking him to step into the toll lane dispute that is quickly becoming a political minefield.

The letter requests that the state’s contract with I-77 Mobility Partners be voided based on what they say is a laundry list of legal troubles surrounding the group’s primary contractors, Cintra Infrastructureas and its parent company Ferrovial Agroman, both based in Spain. Ferrovial with Cintra is among the largest transportation construction companies in the world, employing more than 6,000 people.

Among other accusations, opponents of the I-77 project point to an investigation by the Spanish Ministry of Justice of a Ferrovial executive accused of funneling over 6 million euros to a government official through Barcelona’s Palau de la Música auditorium. The Wall Street Journal and the Spanish newspaper El Pais reported the story in 2013 and 2014.

Cooper’s office told Jones+Blount that the accusations are “troubling” but said that further investigation would be the domain of the State Bureau of Investigation, not the Department of Justice.

AGletter

“This is not the kind of company that we want to bring into North Carolina,” said the letter’s author, Diane Gilroy, a Spanish teacher at UNC-Charlotte and the wife of Cornelius Commissioner Dave Gilroy. “I believe the Attorney General should step in on behalf of the citizens and void this contract.”

In May 2015, the NCDOT finalized a contract with I-77 Mobility Partners (Cintra and Ferrovial) to install toll lanes in both directions along a 26-mile stretch from Mooresville to uptown Charlotte. The NCDOT is investing $95 million in the project and says the optional pay lanes will help ease congestion in the Charlotte area where population has grown 135 percent over the past 25 years.

Addition of the toll lanes along I-77 is a Public-Private-Partnership (P3) project approved by the Charlotte Regional Transportation Planning Organization to  give drivers a choice of using existing general or HOV lanes for free or paying a toll for express lanes.  Under the terms of the contract, the state would own the road and all lanes, while Cintra would maintain and collect toll operations and revenue  for 50 years.

The contract is worth over $600 million, and the penalty for early termination is close to $100 million. Widen I-77, a group that advocates for widening the road without tolls, calls this is a bad deal for citizens and believes the state would not owe the penalty if the contract were cancelled due to concerns over the contractor’s legal disputes.

However proponents of the project say it’s not that easy. The NCDOT says that even if the contract were cancelled, additional lanes could not be immediately added. The new lanes would have to be scored under the state’s biennial Strategic Mobility Formula, would have to score high enough to be made a priority, and would still be subject to strict corridor spending limits over five years. When planning and building time is added, a wider I-77 would be in a distant future.  Under this contract, the lanes could be operating within three years.

“The congestion issue must be addressed. At the current time there is a legally binding contract in place,” said Rep. John Fraley (R-Mooresville). “Until you have a specific, non-speculative alternative plan in place, then it should move forward.”

With construction due to begin this summer, the Mecklenburg County Commission recently voted to join four other Charlotte-area governments (Mooresville, Davidson, Cornelius and Huntersville) in requesting a 90-day stop to the toll road project while they study the terms of the contract.

“It’s limiting our capacity for growth going forward. That’s my main concern right now,” said toll road opponent Greg Wallace, who commutes daily from Cornelius to Mooresville. The 10-mile journey takes him between fifteen and 45 minutes, he said.

Credit: NCDOT

Credit: NCDOT

Cintra, the primary contractor on the project, built a similar toll road in a Dallas suburb. There, 1-20 Texas homeowners living around the project filed a class-action lawsuit against the construction company, claiming that high-powered construction equipment caused extensive damage to their homes.

The “Texpress” is now open and costs up to 75 cents per mile, depending on volume. Opponents of the I-77 project said that the dynamic pricing and longer stretch mean that North Carolina drivers could be charged up to $20 each way to use the toll road.

Cintra/Ferrovial also built the Indiana Toll Road, but the coordinating group was $6 billion in debt when it went bankrupt in 2014 before recouping the costs. This month the ITR emerged from bankruptcy after an Australian Company paid $3.6 billion for a 75-year lease on the highway.

The Widen I-77 group and other toll road opponents have started extensive social media campaigns and knocked on nearly every state government door. On Tuesday, they are scheduled to hold a press conference in the legislative building with Tarte, when they are expected to present legislation designed to stop project.