KEY POINTS:
Toll administration costs alone are likely to equal the extra $800 million Transit NZ says it needs to find to complete Auckland's western ring route by 2015.
Financial details disclosed by the agency at the end of last week indicate the Herald has been conservative in predicting tolls
would push the final cost to motorists for completing the 48km route between Manukau and Albany towards $4 billion.
The figure could reach or exceed $4.15 billion after counting:
* Repayments of more than $2 billion over 35 years on a loan of $1 billion.
* Administration costs of about $800 million.
* Traditional funds of $1.3 billion already promised by the Government.
Transit NZ, which has waited until more than halfway through a seven-week public consultation period before issuing preliminary funding details, expects to raise $900 million from motorists - plus GST - in the 10 years after the ring route is complete.
It says in a briefing paper that it cannot make longer-term revenue predictions, but estimates administration costs will claim up to 33 per cent of tolls collected in the early years, before averaging 25 per cent over the total charging period.
It expects to have to raise a loan of up to $1 billion to cover an $800 million funding shortfall, $140 million for tolling infrastructure, and interest charges that will at first exceed revenue.
Chief executive Rick van Barneveld said Transit could not be held responsible for any revenue projections by the Weekend Herald which suggest gross takings may if anything exceed $3.2 billion.
Transit wants to charge tolls ranging from 75c to $1.50c for cars at peak periods at seven electronic charging points, and double for trucks, in 2005 dollars with adjustments for inflation plus annual rises of up to 2 per cent.
But asked if he accepted that administration costs were likely to reach $800 million, Mr van Barneveld said: "Yes, you could say that, because that's where it would be in the long haul."
He also said the Herald's use of the Retirement Commissioner's on-line debt calculator to estimate a $2.04 billion payback on a $1 billion loan over 35 years at an annual interest rate of 7.5 per cent was a simple but "valid" exercise.
On the other side of the ledger, Transit points to a study commissioned by the Automobile Association which in 2004 estimated an economic benefit of accelerating completion of the ring route at $838 million a year. That meant a return of $4.60 for every dollar invested.
But Waitakere City councillor Derek Battersby, who earlier challenged Transit to reveal all its financial documents so the public could see "how stupid the whole process is", said the Government could save Aucklanders anguish by borrowing from its superannuation fund and repaying itself $50 million-plus a year with a 5c-a-litre regional fuel tax.
He and his colleagues have been joined by Auckland City's transport committee and Manukau Mayor Sir Barry Curtis in suggesting a new fuel tax would spread the financial burden more equitably throughout the region.
But that could limit alternative revenue options for filling a $700 million public transport funding gap facing Auckland.
