By Eric Miller, Staff Reporter This story appears in the Aug. 5 print edition of Transport Topics.
The bankruptcy filing by the private owner of four Alabama toll roads and the operator of the Detroit-Windsor Tunnel is not expected to have any immediate effects on freight haulers, officials said.
In a filing late last month, American Roads LLC said a voluntary restructuring of its balance sheet is necessary because it is unable to meet its financial obligations due to “significant traffic declines.”
In Alabama, American Roads owns the Foley Beach Express, Emerald Mountain Expressway, Alabama River Parkway and Black Warrior Parkway.
The Alabama Department of Transportation told Transport Topics the roads were privately built and are privately operated.
“The state doesn’t have any regulatory authority over the tolls,” spokesman Tony Harris said. “There are no state-owned toll facilities in the state of Alabama. We’ve considered it in the past but never found it to be viable from a debt standpoint.”
American Roads said traffic declined between 1.9% and 8.6% at each of its toll facilities from 2007 through 2012.
The decline was driven by a number of factors, including the recession, fuel prices and the effect of toll increases, the company said.
Trucks are allowed on the Alabama toll roads, and the bankruptcy filing is not expected to affect freight movement, Alabama Trucking Association President Frank Filgo said.
“I just don’t think the commercial vehicles use their toll roads to a great extent” because the tolls are too high, Filgo said.
American Roads also operates the Detroit-Windsor Tunnel, which is jointly owned by the city of Detroit and the city of Windsor, Ontario.
Windsor Mayor Eddie Francis indicated at a July 25 news conference that Windsor would be interested in pursuing a purchase of Detroit’s ownership of the tunnel.
“If there ever is a time whereby anybody wakes up on the American side and decides that they’re going to sell this asset and put it in private hands, obviously we have an interest,” Francis said.
In its bankruptcy filing, American Roads said it is carrying a debt of roughly $830 million. The company said that during 2012 it paid about $35 million for debt service, while generating only $14.2 million in earnings before interest, taxes, depreciation and amortization.
Staff Reporter Michele Fuetsch contributed to this report.
