Bill raises possibility of toll lanes on Interstate 35 in Austin

Looks like tolls could be back on the table for Interstate 35 if a local legislator has his way.

Rep. John Cyrier, R-Lockhart, filed House Bill 2114 last week. The bill would mark a 28-mile stretch of I-35 – from the Texas 45 toll road in Round Rock to Texas 45 in southern Travis County – as eligible to be developed and expanded through a comprehensive development agreement, which is a form of public-private partnership.

In layman's terms, it means that the Texas Department of Transportation could begin shopping for a private company to invest in the interstate's expansion.

For that investment to make sense, new lanes on the highway would need to provide a revenue stream to the private company, which would take the form of toll lanes.

Cyrier told the American-Statesman he wants TxDOT to begin exploring a toll road possibility for I-35 due to sticker shock over the cost of the interstate's upcoming expansion. The total estimated price to expand I-35 from the Williamson County border to Texas 45 South is near $7.5 billion.

"It's decades of funding that we're having to tie up for one project," Cyrier said. "This option ... is not new. It's just making more sense at this point."

In February 2020, Texas Transportation Commission chair J. Bruce Bugg Jr. announced that the commission would dedicate $3.7 billion to the I-35 project to fully fund the highway's expansion through central Austin.

To get to the full amounted needed, Bugg asked the Capital Area Metropolitan Planning Organization, the Austin metropolitan area's government board that outlines what projects should be eligible for some federal funding, to chip in $600 million.

The board agreed, slashing dozens of projects from its long-term planning document, including some in Cyrier's district, which includes Caldwell and Bastrop counties.

HB 2114, which does not yet have a companion bill in the Texas Senate, would allow TxDOT to create a comprehensive development agreement for the expansion of I-35 in Austin. It is a similar structure to the privately funded construction of the southern portion of the Texas 130 toll road.

The company that funded that 41-mile stretch of road, SH 130 Concession Co., went bankrupt in 2016. The company emerged from bankruptcy in 2017 under new ownership, which later sued the previous ownership, accusing them of self-dealing and shoddy construction. 

All other area toll roads were built by and operated by government entities, including the Central Texas Regional Mobility Authority.

The idea of toll lanes on I-35 in Austin is not new. However, it was quietly removed from the table after political tides tuned against toll roads at the Capitol.

But funding the $7.5 billion expansion project solely with taxpayer dollars has come under question. In April, Sen. Robert Nichols, R-Jacksonville, and Rep. Terry Canales, D-Edinburg — both chairs of their respective chamber's transportation committees — expressed concerns over committing to fully fund the project as tax revenue was dropping due to the COVID-19 pandemic.

Tax revenue projections have since improved, but Cyrier said he continues to have concerns over revenue shortfalls.

"Things have changed and we need to be creative," he said.

The proposal to expand I-35 includes building two managed lanes on both sides of the highway that would be reserved for high-occupancy vehicles. The highway would add lanes on the entire stretch, with portions of it possibly tunneled, preliminary plans show.

Austin Mayor Steve Adler said he is in favor of having managed toll lanes on I-35. Adler said variable toll lanes like those on MoPac Boulevard (Loop 1) have been a boon to the Capital Metro buses that travel on MoPac, creating a free fast lane for public transportation that an be used as a selling point to get people out of cars.

"I continue to be a strong supporter of tolled managed lanes on I-35, because that's the only way to really ensure that buses will always be traveling at 45 miles an hour," Adler said. "And if other people are stuck in traffic and buses are going by moving past them, some of those people will get out of their cars and get on the buses."

The number of people using MetroExpress routes that use the MoPac Express Lanes has grown considerably since tolled lanes opened on the highway, according to data from CapMetro. Ridership has more than doubled on those routes, while other MetroExpress routes have seen modest increases.

However, the roughly 2,700 passengers who used those routes each day before the pandemic remains dwarfed by the 179,255 TxDOT estimated used the road on a given day in 2019.