Board approves financing for U.S. 460 toll-road project

RICHMOND — The Commonwealth Transportation Board approved the financing arrangements Wednesday to make the $1.4 billion U.S. 460 toll-road project a reality.

The state anticipates finalizing the deal with US 460 Mobility Partners, the project’s design-build consortium, in December, officials told the state Transportation Board.

US 460 Mobility Partners will start design, right of way and permit work in 2013, and the 55-mile highway’s construction is to begin in 2014. The road is supposed to open in 2018.

Three industry groups competed for the project. State Highway Commissioner Gregory A. Whirley selected US 460 Mobility Partners because its proposal needed the least amount of public subsidy.

“The new Route 460 highway is critical to economic development in this growing region of Virginia,” Gov. Bob McDonnell said. “The new highway will stimulate business development in the region and accommodate greater freight traffic from the Port of Virginia, benefiting the entire commonwealth.”

Richmond’s Chmura Economics & Analytics estimated that by 2020, the new highway will have an annual economic impact of $7.3 billion, the governor said.

The southeastern Virginia localities between Petersburg and Suffolk have been “as hard hit as any area in the commonwealth” by the recession, said Transportation Board member Roger Cole of Ashland. “They’re all supportive.”

Drivers will pay $3.69 for cars to use the four-lane, limited-access highway between Petersburg and Suffolk and $11.72 for trucks. The road-user fee will start at 6.7 cents a mile for cars and 21.3 cents a mile for trucks.

“The big driver in this project is to provide an attractive alternative” to heavily congested Interstate 64 between the capital region and Hampton Roads, state Transportation Secretary Sean T. Connaughton told the board Wednesday.

Car drivers will pay to drive the new U.S. 460 so that they will not get stuck — again — in traffic on I-64, Connaughton said. “Taking 64, you just don’t know what you’re going to hit.”

Toll rates will increase 3.5 percent per year, though that figure could go up or down depending on the road’s traffic. The tolls will be collected electronically using E-ZPass, while the existing U.S. 460 will continue as a free alternative route.

On the new U.S. 460, “You’ll be able to travel at high speed, uninterrupted” by the current highway’s stoplights and slower speed zones, said Charlie Kilpatrick, the state’s chief deputy highway commissioner. “You shouldn’t have to apply the brakes the entire trip.”

“I don’t see any private-sector skin in the game,” said Transportation Board member James E. Rich of Middleburg. Usually the state’s public-private transportation deals feature a significant amount of upfront money from the private partner.

Because the project was a “greenfield” one, Kilpatrick said, private investors were reluctant to back it on terms that would produce reasonable toll charges imposed over a time shorter than nearly a century.

Previous U.S. 460 construction proposals estimated the project’s cost at $1.5 billion to $2 billion, called for tolls as high as $13.20 a vehicle charged for 75 to 99 years, and required infusion of $500 million to $1 billion in public funds.

Now funded by tolls and existing state transportation revenues, the project is less costly and the tolls will run only 40 years, Kilpatrick said.

Currently, Hampton Roads residents “are stuck with a very congested one-way out,” said Transportation Board member W. Sheppard Miller III of Virginia Beach. “This gives us a real option.”

And Miller said, “The toll is reasonable.”

The project is being paid for largely with money from McDonnell’s $4 billion transportation package approved last year.

However, warned board member Mark J. Peake of Lynchburg: “It’s the last chunk of money we have to borrow. This is it. We’ve spent every nickel we’ve got unless something dramatic happens.”

“We don’t understand the rush,” Stewart Schwartz, executive director of the Coalition for Smarter Growth, told the state Transportation Board. “That’s a significant amount of debt we’re taking on.

“Is this the best investment we could be making? I don’t see the economic benefits.”

The Tri-Cities and Hampton Roads metropolitan planning organizations have made the Route 460 project a priority for their regions’ transportation systems.

The new project includes seven interchanges, located at state Routes 156, 625, 602, 40, 620, 616 and U.S. 258.

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