Key factors that influenced the toll escalation formula at that stage included:
■ the RTA's decision to protect the financial offer (upfront payment) and not use its capital expenditure budget
■ the lack of definition of project costs meant that the $75 million included costs unrelated to the project, especially some public domain improvements.
We discuss the implications of the change to the escalation formula at that stage in some detail in Chapter 3.
The effect of the escalation on the tolls highlights the impact of the way 'no net cost to government' was applied. Many of the public domain improvements benefit others, not the motorists using the tunnel. These include bus commuters enjoying improved travel times, and pedestrians, tourists and cyclists enjoying the improved William Street 'boulevard'.
The upfront payment had an indirect influence on the base level toll increase.
The increase in the base level toll could have been lower than 15 cents if the RTA used more than $3.1 million from the upfront payment. In other words, the RTA could have funded more of the $35 million worth of works that CCM carried out.