Killing mid-county span could cost up to $10 million
In response to questions raised by state lawmakers about a proposed toll bridge between Corolla and the mainland, the head of the N.C. Turnpike Authority said killing the project would cost the state up to $10 million.
The state would also be on the hook for at least 30 years to pay the difference between toll revenues and what it would cost to build the Mid-Currituck bridge. The estimated cost of the project is $650 million.
In a letter dated Aug. 3, Executive Director David Joyner, answered a series of questions posed in July by the four co-chairs of Joint Legislative Transportation Oversight Committee.
The committee is co-chaired by Sen. Bill Rabon (R-Brunswick), Sen. Kathy Harrington (R-Gaston), Rep. Phillip Frye (R-Mitchell) and Rep. Grey Mills (R-Iredell),
Rabon has been a vocal critic of the mid-Currituck bridge and other proposed toll projects across the state, including one in his district.
Addressing concerns raised by the committee, Joyner pointed out the state will retain ownership of the bridge throughout the 50-year term of the contract, and the private partnership is required to invest at least $40 million in the project. A preliminary partnership agreement was signed in 2009 between the Turnpike Authority and Currituck Development Group LLC.
Once the state and private partners close on the contract, 30-year bonds would be issued to finance the project, which would be repaid using toll revenues.
“Publicly funded (gap) appropriations will be required only for the first 30 years of the project,” Joyner stated. “The final 20 years of operations and maintenance will be self-sustaining through toll revenue and will require no additional appropriation of public funds.”
“At the point that bonds are issued, the state is obligated to use the gap funds to secure and repay the 30-year-term appropriation bonds,” Joyner said.
The authority estimates $26 million a year would be needed annually in the state government’s annual budget to make up the shortfalls.
“As with almost all new toll projects, projected toll revenues are not expected to pay the total cost of financing the project,” Joyner said.
The state would have to pay for any work done by the partnership if the project is cancelled before the final agreement is signed.
“During the period of time between commercial close and financial close, the state’s financial obligation to the project will not exceed $10 million,” Joyner said.
If a suit threatened by environmental groups in hopes of blocking the project is successful, the state would still have a financial obligation to meet.
“If, after commercial close, legal action does not allow the project to move forward, the risk to the state will be capped at $10 million for costs incurred by the private partner,” Joyner said. “The private partner will only be compensated for work performed needed to obtain the environmental permits.”
The state would take ownership of all design work conducted by the private partners and could use those plans to build the bridge on its own.
The 7-mile-long toll bridge would span the Currituck Sound from the Aydlett community on the mainland to between Corolla Bay and Monteray Shores on the Outer Banks.
Supporters say the bridge is necessary to address summertime traffic on U.S. 158 and N.C. 12 and help speed hurricane evacuations.
Detractors counter it would create an explosion of development and traffic on both the mainland and along the Currituck Outer Banks.