The Pennsylvania Turnpike Commission approves a 5% toll hike for 2023

As the Pennsylvania Turnpike Commission raised tolls Tuesday for the 15th year in a row beginning in January, officials went out of their way to show the increase is needed despite elimination of a $400 million annual payment.

The commission unanimously approved raising tolls by 5% next year without comment, the second consecutive increase at that level after 6% annual hikes since 2015. Before the vote, Chief Financial Officer Richard Dreher told the board the increase was "the minimum amount required to meet our obligations."

This is the first time in 12 years the turnpike doesn’t have to shift $400 million to the state Department of Transportation to help pay for public transit, which reduces some of its operating expenses. But Dreher told the commission the agency will be saddled with debt for 30 years from borrowing money to make those payments, with debt payments spiking at about $600 million in 2038.

Dreher said the agency has “made sure our financial house is in order” in recent years by cutting operating expenses, reducing staff and using more operating funds to pay for capital projects to reduce borrowing. For example, since 2013 the agency has refinanced $600 million in debt a variety of times to save about $1 billion, but its overall debt is still about $15 billion.

"As an organization, I am proud of the fact that we work hard to manage the debt placed upon us by making prudent borrowing decisions and restricting operating-budget growth," turnpike CEO Mark Compton said in a news release.

"While we are now essentially free from this onerous [PennDOT payment], we must continue to honor the debt-service obligations for 30 years. But a measure of relief is under way, and motorists can expect the level of increases to ease in a few years."

Based on current traffic projections, the turnpike is projecting annual increases of 5% through 2025, 4% in 2026, 3.5% in 2027 and 3% from 2028 to 2050.

In the news release announcing the increase, the agency also included a chart prepared by consultant CDM Smith that shows it ranks 24th in cost per mile out of 47 agencies that use E-ZPass, a prepaid electronic collection system. The turnpike charges 13.8 cents a mile compared to the national average of 17.8 cents a mile.

“It’s worth noting that, even with these ongoing annual increases, our per-mile toll rate continues to be below the midline compared with rates of other U.S. tolling agencies,” Compton said.

The vote Tuesday came after the commission had pulled it from the agenda for two meetings in July, once because staff said it wasn't ready and the second time because the board reorganized and named Philadelphia attorney Wadud Ahmad as chairman to replace PennDOT Secretary Yassmin Gramian.

Before the vote, Eric Epstein of advocacy group Rock the Capital called on the commission to break its streak and not increase rates in January due to runaway inflation.

“I don’t know that we need a toll increase right now,” Epstein said. “You have an opportunity to be a hero today.”

With the increase, the most common toll — the rate the highest percentage of customers pay — for motorists who use the pre-paid E-ZPass system will increase from $1.70 to $1.80 and from $4.10 to $4.40 for those who use Toll By Plate, where a 45% surcharge is added to cover the cost of taking a photo of a car's license plate and mailing the owner a bill.

For a Class-5 tractor trailer, the most common toll will increase from $13.70 to $14.40 for E-ZPass and from $28 to $29.40 for Toll By Plate.

The rate to travel from Ohio to New Jersey through Pennsylvania in a passenger car will increase from $49.50 to $52.10 and, for Toll by Plate, from $100.20 to $104.50.

The turnpike also is continuing its push to get more customers to use E-ZPass, where a motorist has a transponder linked to a credit card for payment. About 86.7% of customers use that system while many of the remainder use Toll By Plate, where 34.6% don't pay their bills, costing the agency $155 million during the last fiscal year.

The agency also offers the Pay Toll PA app that allows motorists to pay their Toll By Plate fees by phone for a 15% discount. Motorists without bank accounts or who want to pay cash can pay at dozens of convenience stores through the KUBRA Cash Payment Network.