New toll road merger plans OKd

Alicia Robinson

Board members will consider four options next week to help bail out

the financially ailing San Joaquin Hills toll road, but two couldn’t

immediately be put in place and the others are versions of an already

considered $3.9-billion bond proposal that would merge the two

agencies that currently govern the toll road system.

An ad hoc committee of the toll roads governing boards’ members

voted unanimously Wednesday to bring four proposals back to the full

board at its April 8 meeting, said Lisa Telles, a spokeswoman for the

Transportation Corridor Agencies, the toll roads’ administrative

agency.

“It will be indicated that only two can be done at this time,”

said Peter Herzog, chairman of the Foothill and Eastern toll roads

board. “The other two will take a lot of work.”

For two years, that board, along with the one governing the San

Joaquin Hills toll road, have been mulling how to save the San

Joaquin Hills toll road from financial collapse. The road is

financially insolvent because of inaccurate revenue projections.

Members of the two boards will consider a proposal from Orange

County Supervisor Chris Norby under which the Foothill and Eastern

toll roads’ governing agency would purchase the assets and pay the

debts of the San Joaquin Hills toll road.

Norby projected the plan would save drivers $3.6 billion in future

tolls and would not require issuing any bonds.

County Treasurer-Tax Collector John Moorlach’s proposal also will

be given to the toll roads’ oversight committee. He suggested the

Foothill and Eastern toll roads agency purchase a 10-year option to

buy the San Joaquin Hills toll road with a provision to extend the

option.

The other two proposals the board will consider are versions of

the original merger plan that board members twice delayed voting on

because some questioned its cost and wanted to see other options.

The earlier proposal would sell $3.9 billion in bonds, consolidate

the two agencies’ operations and restructure debts at low interest

rates. This plan will be considered with either all fixed-interest

rate bonds or some at fixed and some at variable rates.

The already-vetted merger proposals have an advantage because

they’ve been checked out by bond rating agencies and can be insured,

Herzog said.

Norby’s and Moorlach’s plans could have tax consequences or

require changes in tax law, so they would have to be studied further

to see if they are feasible, he said.

“We have two plans that meet all the goals and objectives that the

board set out,” Herzog said. “They’ve been fully reviewed and

analyzed, they’re rated, they’re insured and they’re marketable, so

it seems like one of those two should be chosen.”