ALBANY - Thruway officials Friday showed no signs of backing down from a 45 percent proposed toll hike, saying failure to raise the tolls could raise the cost for a new $5 billion bridge downstate.
While the toll hike's $90 million in annual revenues is not supposed to be directly related to the Tappan Zee Bridge replacement project north of New York City, Thruway officials told legislators that not going ahead with a toll hike would harm the agency's overall fiscal health. That, in turn, could make more costly things like borrowing money to fund the Tappan Zee project, Gov. Andrew M. Cuomo's signature economic development project.
The agency is scheduled to approve a 45 percent toll hike on vehicles with three or more axles as early as the end of this month.
Without that additional revenue, the result could be additional hits on the agency's workforce, capital program and "some very serious choices" for the state's canal system, said John Bryan, the Thruway's chief financial officer.
The canal system's costs - at least $100 million a year - were transferred in a fiscal gimmick in 1992 to the Thruway Authority. Some lawmakers have been calling for the canal to be taken away from the Thruway so that highway motorists are not funding the separate and money-losing waterway system, which includes the Erie Canal.
Thruway Authority Executive Director Thomas Madison told a panel of Assembly lawmakers Friday morning in Albany that no final recommendation has been made by the agency's staff on the toll hike. But Madison gave a variety of reasons why the toll hike revenues are needed.
The agency, in a $1 billion borrowing earlier this summer, already told investors that it saw no reason why its 45 percent toll plan will be substantially changed. The agency then held three hearings around the state where officials heard from business and consumer interests about the financial and economic hardships the large toll hike will spawn at a time when the state's economy is sputtering.
And when asked by Assemblywoman Jane Corwin, an Erie County Republican, about any other toll hikes in the next couple of years, Madison did not rule out that possibility.
Thruway officials insisted they are cutting costs, including lowered contract offers for unionized workers and for technological changes along the highway system, including automated toll booths in some areas.
Madison said the agency needs additional revenues for road construction and to maintain the canal system, which he said provides upward of $400 million in economic development benefits to upstate communities. Madison acknowledged that some of the toll revenues would be dedicated to the canal operations, though he did not provide a number.
Brennan raised concerns about the agency's growing debt burden and noted that the Thruway is "getting deeper into the hole." He said annual payments on Thruway borrowings are expected to grow from $167 million in 2011 to $266 million by 2013.
Critics, from farmers to trucking companies, say the toll hike will be passed on to consumers in higher prices on everything carried by truck.
Thruway officials estimated Friday that up to 10 percent of trucks will stop using the Thruway if the rate hike goes through.
But Madison said revenues are needed for the 570-mile system, of which only 70 miles have been completely reconstructed since the roadway was finished in 1960.
"We're getting to the point where the system is starting to show its age," Madison said.

email: tprecious@buffnews.com