Boulder Daily Camera
October 24, 2005
Northwest Parkway failing expectations: Critics continue to question need for newest toll road

By Kim Castleberry
Boulder Daily Camera Staff Writer

More motorists are hopping on the Northwest Parkway today than they were when it opened almost two years ago.

But the toll road is not drawing the kind of traffic originally expected, and the smaller numbers could start negatively affecting investors.

The Northwest Parkway opened Nov. 24, 2003, connecting the 47-mile E-470 toll road at Interstate 25 with U.S. 36 in Broomfield.

Through August, parkway traffic and revenue were 40 percent ahead of last year. Still, toll revenues projected for 2005 will probably come in 50 percent to 55 percent below what was estimated a few years ago.

Earlier this month, Fitch Ratings decided to maintain its "negative" rating of the parkway's $404.5 million bond debt, classifying the bonds one level above "junk." The negative rating was given because of "significantly lower-than-expected traffic and revenue trends," Fitch analysts said.

The news came a couple of months after state Rep. Gwyn Green, D-Golden, questioned why the toll road was ever built given the light traffic. Green and many others in her area have an interest in the parkway's progress because of looming proposals in Golden to close the gap in the metro area's beltway.

Golden officials and residents have long opposed a road that would connect the Northwest Parkway with a proposed final stretch linking to C-470 near Golden. Some have said the parkway's light traffic is proof that there isn't a big enough demand.

Parkway director Steve Hogan said the public highway authority is working to delay the debt payments because it makes the most fiscal sense. But, he said, focusing on bond-rating reports doesn't tell the road's whole story.

"Our numbers continue to climb, showing solid, steady growth in terms of usage," he said.

In January, the daily vehicle average was 8,170. In September, that number had jumped to 10,700 a day. Hogan said if current trends hold, he could see 10,900 a day by the end of the year. But those numbers are considerably lower than the 28,000 vehicles a day the road was expected to be carrying now, according to a Colorado Department of Transportation study completed before the highway opened.

Hogan said the Sept. 11, 2001, terrorist attacks, the economy's slide and a lack of job growth in the area caused traffic to be much lighter than expected. But, he said, estimates about residential growth were nearly on target.

"It was a crystal ball," he said. "And the bonds were rated and sold based on those assumptions."

What matters most to the toll road and its investors is revenue, Hogan said.

In 2001, revenue projections for 2005 were $10.4 million. Now, though, expected revenue is just $5.8 million this year. Thanks to a combination of strong bond reserves and $17 million left over from construction costs, Hogan said, the authority will have no trouble paying the bills.

Tom Atkins, chairman of Citizens Involved in the Northwest Quadrant, said he takes the negative bond rating as a sign that the parkway is in trouble. His group has long campaigned against extending the highway to Golden. He counters arguments that more commercial development will help fix the parkway's troubles.

"Interlocken is right at the end of that road," he said. "How much more development than that do you need?"

Atkins said because projections for the parkway were used to forecast traffic on the proposed Northwest Corridor highway to Golden, that study and other toll-road planning around the state should stop.

"What this says to me is that these guys don't know how to forecast traffic on toll roads," he said.

The Northwest Parkway 's toll will increase from $1.75 to $2 on the main stretch starting next year, an increase that was scheduled when bonds to build the road were sold in June 2001. The toll from U.S. 287 to U.S. 36 will stay at 50 cents. A new interchange at Sheridan Boulevard is expected to open Nov. 7 with a 50 cent toll for those going east and $1.75 for those heading west through the main plaza.

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