So it became a toll-free highway.
Or did it?
Laila Yuile, a provocative writer and blogger who keeps a close watch on the B.C. government, has been drawing attention to documents that indicate a “shadow toll” exists on the dramatically scenic highway that links Vancouver to Whistler.
Although the government rejects that label, officials acknowledge that over the next 25 years, the province will pay about $75-million of public money to the Sea to Sky partnership that undertook the project.
And part of that money will be based on traffic volume.
Ms. Yuile has been stirring debate by arguing that, in effect, this is a hidden toll on the highway, and that it has been hung around the necks of unwitting B.C. taxpayers.
“There are shadow tolls – and they don’t want the public to know about it,” she said.
When government officials rejected her assertions, Ms. Yuile dug up persuasive evidence to the contrary, including a June news release by Transtoll, a company that has a contract with Sea to Sky Highway Investment Ltd. Partnership to provide traffic counting technology for the road.
“The accuracy of the traffic counting system is extremely important on the Sea to Sky Highway because the roadway is financed through a shadow tolling scheme,” Dan Toohey, executive vice-president of Transtoll said in the release.
As well, an annual report by Macquarie Bank lists the Sea to Sky Highway as one of eight “toll roads” it has invested in.
And Nicholas Hahn, managing director of Macquarie North America Ltd., admits the phrase may have passed his lips.
Strictly speaking, however, he said it’s not a “shadow toll” but a complex contractual arrangement with the province that uses incentive payments to ensure the highway is maintained at a high standard throughout the 25-year life of the contract.
Mr. Hahn, who is based in Vancouver, said there are four components to the contract. One paid a bonus to the consortium to keep the highway open as much as possible during construction, and a second rewards the operator for keeping the road open now that it’s built. If a bridge breaks down or the pavement cracks, causing traffic delays, the contractor pays a penalty to the government.
Two other “targeted payment regimes” apply to the operation of the highway. One is a “safety performance payment” that basically rewards the company if the Sea to Sky Highway has fewer accidents than similar roads in B.C.
And then there is an incentive payment tied to the number of vehicles that use the road.
“Now those vehicle usage payments – I’ve heard them described as a shadow toll, I’ve probably even used the term shadow toll myself in the past – they are not really a direct shadow toll because we don’t get an amount of money for every vehicle that uses the road,” he said.
Under the deal, the government pays a set amount when certain traffic levels are reached, but the payments fall as traffic numbers climb.
“Basically, let’s say the traffic today is 10,000 per week … then we get X-amount per vehicle … and then … [at]12,000 to 15,000 vehicles, you get a lower amount per vehicle. And then above a certain band, let’s say 15,000 vehicles, we get nothing,” he said.
So even if you do call it a shadow toll, it’s a shadow that fades away as vehicle use increases?
“Exactly. Yeah. I guess to me the strict term ‘shadow toll’ would imply that if there’s 100,000 vehicles using the road, then we get paid for 100,000 vehicles. That’s not the case in Sea to Sky,” said Mr. Hahn.
Peter Milburn, deputy minister of Transportation, said “shadow toll” is not a term he would use. But he acknowledges the private consortium will get incentive payments of about $75-million over 25 years depending on safety performance targets and vehicle use.
So, it is a toll, but it’s invisible to the public, and the government doesn’t have to wear it because it can be described as something else.
Talk about creative bookkeeping.
Again…the devil is in the details…
I think it is fair to say the average BC Citizen felt when the Sea – to – Sky Highway was built….there was a contract price to do the work ie $ X….it was built….”the end”…. and the issue is closed when the final bill is paid.
Now we stick a fork into this turkey and look at all the EXTRA gravy oozing out .
As a side note, quite interesting how these types of stories are published elsewhere….yes the truth is out…but you have to look elsewhere to find it…not a local BC paper?.
This is why (i) transparency is so important, and (ii) and thus why transparency is avoided…..
When I buy or pay for something, yes I want quality and assurances if something goes wrong, but at the end of the day ( and warranty ) I want a divorce from the seller…I don’t want them coming back for more.
Put it this way..Gov’ts are not all that bright …..they are not good money managers(ie its not their money), and yet they act on our behalf…and are easily taken advantage of. Why would they have a sliding scale re: number of vehicles per day ? Whats the connection….or is it a clever clause knowing numbers will be low…thus extra $$$ gouge ? Safety bonus….it is either safe to “X” degree or it is not…rest is too many variables.
A long term view of this Sea to Sky Highway would have probably not have the project commence. I’ve driven this Highway (i) before and (ii) after it was upgraded. Insofar as time savings, I think they are negligible. There is no value to the general public…Safer ? No, safety is a personal responsibility issue. On a long list of white elephants, this deal is up there.
Basically, the 2010 Olympics were a boondoggle….mind candy for political egos.
The greater concern here is how many of these secretive deals are out there that we still don’t know about.