Illinois still contesting Indiana transponder discounts because log-in required

June 1, 2007

TOLLROADSnews

Illinois Tollway officials are playing hardball against Indiana's plans for transponder discounts. Tollway chief Brian McPartlin says he's going to insist on full reciprocity in dealings with the Indiana Toll Road And he's got the backing of his board of directors to charge Indiana I-Zoom transponder users full cash tolls (twice the transponder rate) if Indiana doesn't come around. And there's talk too of the Illinois Tollway suspending the Illinois I-PASS accounts of all Indiana customers - some 90k.

Illinois toll officials have been protesting Indiana plans to offer transponder discounts only to motorists with the Indiana I-Zoom accounts, leaving Illinois I-PASS and eastern E-ZPass accountholders to pay the full cash toll when using their non-Indiana transponders. That discount was negotiated by the Indiana Finance Authority as the first Amendment to the Indiana Toll Road concession to provide for a toll freeze for frequent users. The Amendment set aside $60m of the $3,850m upfront concession fee money to establish a Toll Freeze Deposit Account from which the concessionaire can draw to fulfill the state's late commitment to freeze (transponder) tolls for ten years.

Nothing in the concession amendment limits the toll freeze to Indiana I-Zoom brand transponder accounts but it clearly not the intent of Indiana officials that the subsidies go to out-of-staters, just to local Indianans.

But Illinois Tollway officials clearly have the upper hand in this dispute. Sales of the new I-Zoom transponders will be lessened if the I-Zoom account holders are deprived of the normal transponder toll rates when traveling on Illinois tollways.

Indiana officials agreed Wednesday to extend discounts to 'foreign' transponder accounts (I-PASS and E-ZPass) but only on condition they log in to the I-Zoom website. Indiana officials say that's "fiscal prudence."

Illinois Tollway officials say that's unacceptable. They call the log in requirement "jumping through hoops" and a denial of reciprocity since 'foreign' transponder holders don't have to do that to receive the discounted toll rates in Illinois.

Neither side wants motorists to be buying an I-PASS to get Illinois toll rates and also an I-Zoom to get Indiana's frozen toll rates. Misread rates inevitably go up if motorists are changing transponders on their windshield. Carrying two transponders risks having each charged the toll unless one is shielded from radio waves by a metal foil bag. That also risks motorists forgetting to mount their transponder.

The ITR Concession Company announced at the beginning of the year it planned to begin issuing its I-Zoom transponder May 15 and to start electronic tolling June 15 on the western barrier section. The ticket system would see electronic tolling operational by the fall.

But the dispute is causing those dates to slip.

BACKGROUND: Different toll agencies within the E-ZPass Inter Agency Group (IAG) typically give their own account holders privileges or benefits not available to 'foreign' transponder brands. If they were totally interchangeable there would be no point to the different brands. There would be just one brand and one plan for the whole system.

Previously differences in treatment have been rather small.

The Illinois-Indiana dispute is hot because the discounts at stake are huge - 50%.

Usually the privileges of each plan are quite small - 5 or 10% - so no one cares much. Or they only relate to a single facility. For example Verrazano Narrows Bridge tolls are heavily discounted for MTAB&T account-holders resident on Staten Island, but other places the tolls they pay are the same as those paid by NJ Turnpike or PANYNJ or Penn Pike accounts.

The Illinois Tollway is taking up the issue at the IAG. It is unclear how they will resolve the issue. Any earlier disputes have been quietly settled behind closed doors.

Suspending accounts of Indiana residents, as threatened by the Illinois Tollway, would likely be legally unsustainable. The interstate commerce clause of the US constitution has consistently been used to bar such discrimination based on state residency.