Quote:
Originally Posted by Abner
Yeah, it would be best to build it as a tollway, although obviously toll roads don't make drivers internalize all the costs they make everybody incur. Just wondering, would the construction of a toll road in this case be financed exclusively by a special tax in Lake County?
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Well, in an ideal world, a tollroad authority might pay some sort of "offset" in compensation for environmental impacts, the cost of which is then passed on the tollroad users whose tolls also pay for construction, maintenance, policing, etc. Aside from the environmental offsets, we aren't too far from this (Illinois Tollway ISTHA does, I believe, contract the Illinois State Police, for example, and receives no state tax revenue).
Presumably, land acquisition and road construction would be financed by a bond issue backed by future expected toll revenues, i.e. like most toll roads. Land acquisition via eminent domain or otherwise, along with necessary easements and so on, would be authorized by the various levels of government via a concession (just like how the Ls were built by private operators, way back when). The beauty of toll roads, toll rails ("transit"), etc: no tax involved, and heck, the government can even make money by selling the concession.
To the extent there would be cross-subsidization, it would be by other users of the same toll road system. Again in an ideal world, the toll road entity would only pursue expansion where it would improve their overall balance sheet, thus avoiding any excess capacity that would drain maintenance expense and necessitate higher tolls, thereby lowering demand, etc. That is to say, the tollway authority would generally have the same incentive as its users in avoiding too much cross-subsidization..
Of course, ISTHA's board is packed with political hacks, which is why tolls are historically set too low to even properly maintain the system let alone expand it. In practice, ISTHA is only marginally better than the state and federal highway systems (conveyances of pork) due to its political nature of having a politicized board and having a monopoly on road-privatization (with exception of the Skyway), but I'll take the progress where available.