With the price tag for the proposed new Interstate 10 bridge estimated between $850 million to more than $1 billion according to some experts, ideas about exactly how to fund the plan have been bandied about publicly by a cadre of local government officials.
Congressman Bradley Byrne (R-Fairhope) had dismissed the idea of establishing a toll to pay for the project (originally proposed by Gov. Robert Bentley) by largely referencing a recommendation against it by officials in Louisville, Ky., to Mobile Chamber executives in 2011.
Lagniappe recently sat down with Dr. Semoon Chang about the toll debate for his take on bankrolling the hypothetical high-rise overpass. Dr. Chang, director of the Gulf Coast Center for Impact Studies, is a widely used source for economic impact studies on large-scale business projects in the area and frequently publishes articles about the local economy in national journals.
Lagniappe: How will Alabama pay for the construction of the new bridge?
Chang: I expect Alabama to sell bonds to pay for it.
Lagniappe: Who will pay for the bonds?
Chang: It depends. If payment comes from the Alabama’s transportation budget, the bonds will be paid by Alabama residents including those who live in the north and may never use the bridge. If payment comes from a toll at the bridge, the bonds will be paid by drivers who use the bridge such as those from other states as well as those who commute between the two coastal counties.
Lagniappe: What are the chances that it will be a toll bridge?
Chang: I would say 51 percent. I am tempted to say 90 percent, but won’t at the moment because of some complications following the toll.
Lagniappe: What complications will there be and why?
Chang: If the new bridge is a toll bridge, there is a good chance that the Wallace Tunnel may also have to have a toll. There are two problems with a no-toll Wallace Tunnel. One is that the current traffic problem at the Wallace Tunnel will continue to exist to a large extent. The other is that revenue from a toll at the new bridge may not be enough to pay for the bonds because many drivers will use a toll-free Wallace Tunnel.
Lagniappe: Does it mean that a toll at the Wallace Tunnel as well as at the bridge will solve all the problems?
Chang: Not really. A toll at both the bridge and the Wallace Tunnel will lead to such traffic congestion on Government Street in downtown that city leaders in Mobile will be forced to seriously consider re-instituting a toll at the Bankhead Tunnel. The toll-free Cochran-Africatown Bridge may survive.
Lagniappe: Will a toll at the Bankhead Tunnel be a popular idea among coastal residents?
Chang: Not likely. It can be a curse as well as a blessing, however. It is a curse in that commuting residents between Mobile and Baldwin counties will have to bear the burden. It is a blessing if and only if the revenue from the toll at the Bankhead Tunnel can be earmarked for improvement of the quality of life in Mobile County.
Lagniappe: Should the Wallace Tunnel remain open for traffic when the new bridge is completed?
Chang: I do not know. A key factor may well be that a toll-free Wallace Tunnel will lead to lower revenues from the toll at the bridge that may not be enough to pay for the bonds. If the tunnel is closed except during emergencies, the tunnel can be developed as a new tourist attraction called the “Under the River” or “40-Foot below” shopping area, connected to the Bienville Square and the Dauphin Street entertainment area.
Lagniappe: What kind of economic impact will the construction have on the local economy?
Chang: Construction expenditures may reach $1 billion. A large portion of these expenditures, however, will have no local impact, because they may have to be spent on products imported from outside the local area.
Lagniappe: What about impact of the bridge after it is completed?
Chang: At least in the short run, tolls at three places will hurt sales at the Eastern Shore shopping centers where as much as 20 percent of shoppers may be coming from Mobile County. Mobile County will experience increased sales as well as increased tax revenues. Further, about 25 percent of people working in downtown Mobile live in Baldwin County. These employees will not be happy, although annual driving passes could lower their cost burden.
Lagniappe: Final thoughts?
Chang: The bridge needs to be built. Highway officials have some important decisions to make. Leaders in coastal counties, especially those in Mobile County, may want to plan ahead to maximize the benefits from it.
Commercial Real Estate Moves
Cameron Weavil, Vice President with The Weavil Company, recently sold the old Whitney Bank branch on Dauphin Island Parkway and Brill Avenue to Azalea City Medical Center for $185,000. David Cooper with Prudential Cooper represented Whitney/Hancock Bank.
Weavil also leased the former 17,500-square-foot Azalea City Medical building for $78,000 per year, with an option to purchase for $775,000 as well as the former Shell Station on Airport Boulevard and Azalea Road to Take 5 Oil Change for $80,000 per year over 5 years.
Jeremy B. Milling, CCIM, with Milling Commercial Realty leased 25,000-square-feet of office warehouse space at 5550 Todd Acres Drive in Mobile to Gulf South Services out of Morgan City, La.
Milling also worked with Roofing Supply Group to lease 25,000-square-feet of office warehouse space at 1854-B, E. I-65 Service Road in Mobile. Adam Metcalfe with Metcalfe & Co. worked for the landlord, The Paterson Company.
John Delchamps, associate broker with Merrill P. Thomas Company Inc., recently leased 1,821-square-feet of studio space located at 1175 Hillcrest Road (Hillcrest Shopping Center) to a physical fitness/martial arts training facility.
Ethredge earns CFE certification
Blake Ethredge, CPA, CVA and Senior Accountant with Wilkins Miller Hieronymus (WMH), has successfully completed the certification process with the Association of Certified Fraud Examiners (ACFE) to earn designation of Certified Fraud Examiner (CFE).
CFEs have the ability to examine data and records to detect and trace fraudulent transactions, interview suspects to obtain information and confessions and advise clients as to their findings and testify at trial.
Founded in 1988, the ACFE is the world’s largest anti-fraud organization and premier provider of anti-fraud training and education.