A tale of two cities' tolls

From the Charlotte Observer (Public might not ...):

When the [Greenville, SC] Southern Connector opened in 2001, the toll road was expected to spark development in the southern part of the city. Boosters said it would carry thousands of cars daily, allowing them to bypass Interstate 85 congestion.

But eight years later, development hasn't boomed. The four-lane highway carries only half as many cars as forecast. And because toll revenue is far short of projections, the $200 million project has been using its reserves to pay off its debt for six years.

It's scheduled to go into default in January.

As North Carolina moves forward to build several new toll roads, including two in the Charlotte area, the Greenville highway is a cautionary tale of how the public may not warm up to paying tolls. ...

The Garden Parkway is a planned 22-mile expressway linking Charlotte/Douglas International Airport with southern Gaston County. It's being built as a bypass to Interstate 85, and local leaders hope it sparks development because it will add a new bridge over the Catawba River, improving access.

But the highway is expensive. The N.C. Turnpike Authority hasn't made a final cost estimate, but it will likely cost at least $1.2 billion. ...

Back of the envelope time:

• 55,000 cars per day (about 20 million cars annually) at $2.50 per car yields about $50 million annual toll revenue (an overestimate since all cars wouldn't pay the full toll). It would take 25 years to cover the $1.2 billion cost (ignoring discounting).
• If each of the 20 million annual drivers save 15 minutes in driving time (7.5 minutes each way along a 22 mile trip), they earn $30.30/hour ($60,600 annually divided by 2000 work hours) and they value time at 33% of the wage rate then the time savings are valued at $2.50 per day (=0.25*0.33*30.3). Annual time savings are valued at ... $50 million (same as revenue!).
• So, hey now, wait a minute. Each driver is willing to pay $2.50 per day to save 15 minutes. And the toll might be $2.50. Would you take the toll road?

I didn't think so (see the Southern Connector example).

Note: If you like data go to http://www.southernconnector.com/ and click on traffic statistics. You can get weekly and monthly traffic totals, plus toll revenue.