Pursuant to a provision of law enacted in the Intermodal Surface Transportation Efficiency Act of 1991,7 States may apply toll revenues used for capital expenditures on highways to earn toll credits. These toll credits can then be used to satisfy the State's matching requirement for receipt of Federal-aid highway funding.
=> What are the conditions for toll credits?
Toll credits are earned when a public, quasi-public, or private agency uses toll revenues to fund a capital highway improvement to build, improve, or maintain a highway, bridge, or tunnel that serves interstate commerce. SAFETEA-LU revised 23 U.S.C. 120(j) to permit toll credits to be earned for any toll revenues that are generated and used by public, quasi-public, and private agencies to build, improve, or maintain highways, bridges, or tunnels that serve the public purpose of interstate commerce. Previously, toll credits could only be earned from expenditures of toll revenues on projects that were completed entirely without Federal funds. To qualify for the credit, the following criteria must be met:
• Maintenance of Effort (MOE): The State's total non-Federal highway and transit transportation capital expenditures must equal or exceed the average of three prior years. This "maintenance of effort" test is required at the time the credit amount is established. Once a credit amount is appropriately established, this credit will remain available until used by the State.
• Open to Public Travel: The toll facility that generates the toll credits must be open to public travel. It may be operated by a public, quasi-public, or private toll authority.
• Revenues Must Be Spent on Eligible Expenses: The amount of credit earned is based on toll revenues that the toll authority subsequently spends on eligible expenses for public highway facilities (including bridges, tunnels, and certain ferry systems) that serve interstate commerce. Expenditures for routine maintenance (e.g., snow removal, mowing), debt service, or costs of collecting tolls cannot be included. All such expenditures must have been made entirely from non-Federal sources.
• Source of Revenues: The revenues may derive from toll receipts, concession sales, right-of-way leases, interest earnings, or bond or loan proceeds that are backed by these revenue streams. State grants are not considered to be revenues generated by the toll authority and cannot be used in calculating earned toll credits.
States may apply toll credits toward the non-Federal matching share of any Federal-aid highway project, except for emergency relief projects. Toll credits may also be applied toward the non-Federal matching share of transit projects eligible under Chapter 53 of Title 49. The State must establish a special account to track toll credits as they are earned and used.
For more information on toll credits, see the Innovative Finance Primer at http://www.fhwa.dot.gov/innovativefinance/ifp/index.htm, and U.S. DOT Report to Congress, Chapter 2, at http://www.fhwa.dot.gov/reports/pppdec2004/index.htm#2ciii2.
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7 Pub.L. 102-240, December 18, 1991.