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Funding of Ara Tūhono – Pūhoi to Warkworth

  •   How was the new motorway originally funded?

    In November 2016, Waka Kotahi awarded a Public Private Partnership (PPP) contract to the Northern Express Group (NX2). Under the partnership agreement, NX2 agreed to finance, design, construct, manage and maintain the motorway for 25 years after its completion. Full ownership of the motorway remains with Waka Kotahi.

    This agreement meant construction could get underway earlier than if funding had to be secured through the normal process of being prioritised in full at the beginning of the project. The National Land Transport Programme will still fund the project, but the costs are spread over time.

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  •   Why is Waka Kotahi now looking to toll Pūhoi to Warkworth?

    We need to finance the motorway over the 25 years after its opening; tolling will help us to make the payments to NX2 who will ensure the road remains safe and well maintained.

    An initial assessment in 2011 found that tolling could be used to fund the project and tolling the road in the future was an option. Another assessment completed last year confirmed that Ara Tūhono – Pūhoi to Warkworth is suitable to be a toll road.

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  •   How much revenue will be generated by the Pūhoi to Warkworth toll?

    Modelling has shown that a toll of $2.40 for light vehicles and $4.80 for heavy vehicles could generate $361–547 million over the proposed 25-year period.

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  •   How would the toll revenue be used?

    The revenue collected from the toll would be contribute to the annual amount we need to pay the PPP over the 25 years following the opening of the motorway. It would free up money from the National Land Transport Fund to invest in other important transport infrastructure projects. 

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  •   What alternative sources of funding could be used besides tolls?

    Without the proposed toll, the money associated with the PPP payments over the 25 years following completion of the motorway would come from the National Land Transport Fund. The net revenue from the proposed toll could reduce the annual amount by around 20%, freeing up money from the National Land Transport Fund to invest in other important transport infrastructure projects. 

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  •   How long would tolling be in place for Pūhoi to Warkworth?

    The project has a 25-year repayment schedule associated with the PPP. After the 25 years, it is proposed the toll will be removed from the road.

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  •   Does this mean there will be two tolls for people travelling north on the Northern Gateway Road and the new motorway?

    Yes, the Northern Gateway Toll Road opened in 2009, and that toll will be in place for up to 35 years. We are currently consulting on the proposal to toll Pūhoi to Warkworth; if this toll is implemented, there will be two tolls.

    People travelling northbound from the Northern Gateway Toll Road will be able to exit at Pūhoi if they choose to travel on the free route.

    There is no southbound exit from the new motorway before the Northern Gateway Toll Road. This means southbound travellers would not be able to choose the toll-free option using the current State Highway 1 (SH1) and scenic Hibiscus Coast Highway (formally State Highway 17) via Ōrewa if they joined the new motorway before Warkworth at the northern end.

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  •   Why are you not proposing one ‘overall toll’ for the Northern Gateway and Pūhoi to Warkworth?

    The legislation that governs the tolling of new roads or sections of road means that we can only use the money raised from a toll to pay for that section of the road.

    Revenue collected from the Northern Gateway Toll Road can only be used for the costs of that length of road and cannot be applied to any new motorway. If Pūhoi to Warkworth were tolled, the revenue for tolling would only be associated with the costs of the new motorway. 

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  •   What other roads in New Zealand are tolled?

    Waka Kotahi currently has three toll roads: The Northern Gateway Toll Road north of Auckland, the Tauranga Eastern Link Toll Road and the Takitimu Drive Toll Road, both in Tauranga.

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Tolling assessment and criteria

  •   What is a tolling assessment?

    Every new state highway and significant upgrades to existing state highways in New Zealand, are assessed to see whether they meet the criteria to be tolled. The tolling assessment for Ara Tūhono – Pūhoi to Warkworth shows how the motorway meets that criteria, including any potential impacts of tolling.

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  •   How do you know what the effects of the toll might be?

    The tolling modelling indicated the amount of traffic forecast to use Ara Tūhono – Pūhoi to Warkworth and the alternative route for a range of toll rates.  These forecasts were used to identify the proposed toll rates and the effects on the project benefits and the wider network.

    Key locations in the network were also investigated to identify the effects of a range of toll rates. These locations include Grand Drive in Orewa and Hill St in Warkworth. 

    The views expressed in public consultation may identify other effects we have not yet considered.

    Refer to the Tolling Report for more detail.

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  •   What is the expected change in traffic on the existing SH1 if Pūhoi to Warkworth is tolled?

    If tolling is in place when the new motorway opens, the traffic volume on SH1 is still expected to reduce from the current 24,000 to 10,000 vehicles each day by 2022.

    If tolling is not in place when the motorway opens, the traffic volume on SH1 is expected to be 5,000 vehicles each day by 2022. The assessment shows that a difference of 5,000 vehicles/day creates no significant impacts to the network and is well below the current number of vehicles travelling on that route today.

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  •   What are the effects of tolling on the project outcomes?

    The effects of tolling on the following project outcomes were assessed:

    • Improved travel times – no change expected.
    • Safety benefits– marginal decrease in safety benefits.
    • Economic benefits – no change expected.
    • Reduced CO2 emissions – marginal reduction in CO2 levels.
    • Resilience – no change expected.

    Refer to the Assessment for more detail.

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  •   What is the decrease in safety benefits?

    The new Ara Tūhono - Pūhoi to Warkworth motorway is expected to deliver a 23% reduction in the annual number of injury crashes from 22 injury crashes per year to 17 injury crashes per year. 

    Tolling may marginally reduce the safety benefits of the new motorway as the assessment shows that due to the diversion of those choosing the alternative route there may be a 3% safety disbenefit meaning a reduction from 22 injury crashes per year to 17.7 injury crashes per year.

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  •  The tolling assessment shows the proposed toll could have a 68% internal rate of return. What is this and how is it calculated?

    The internal rate of return looks at the set-up cost for tolling compared with the expected toll revenue. It does not include the costs associated with constructing, maintaining or operating the road which the toll revenue would contribute towards.

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  •   How does the estimated toll revenue change over time?

    The estimated first year toll revenue is $7–11 million. Over the proposed 25-year tolling period, the estimated revenue is $361–547 million.  The revenue changes over time, reflecting increasing traffic volumes and forecasted increases in the Consumer Price Index.

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  •   Why is such a wide range in toll revenue presented in the summary assessment?

    The range is from the 5th to the 95th percentile based on the risks inherent in forecasting tolled traffic volumes, including land use growth and people’s use of the toll road.

    The mid-point expected toll revenue is $447 million, and if the risks resulting in low revenue eventuate then the expected revenue is $361 million.  If the risks resulting in high revenue eventuate then the expected revenue is $547 million. 

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  •   Why does the tolling assessment include a 35-year tolling term if it is proposed the road will only be tolled for 25 years?

    The assessment places the tolling of the new Ara Tūhono -Pūhoi to Warkworth motorway within a comparable context of existing toll roads in New Zealand. As all existing toll roads have a toll term of up to 35 years, the assessment includes a 35-year toll term for the purpose of this comparison.

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Travel choices and safety

  •   If tolling goes ahead, is there a free alternative route for people who want to avoid the toll?

    Yes, the Land Transport Management Act requires that a feasible and free alternative route is available. The current SH1 will be a free route for road users. At the same time as we are consulting about tolling the Ara Tūhono - Pūhoi to Warkworth motorway, we are also formally consulting about improving the safety of the alternative route by lowering speed limits on the section of SH1 between L Philips Road (SheepWorld) and Pūhoi.

    If a toll is in place, people travelling northbound from the Northern Gateway Toll Road will be able to exit at Pūhoi if they choose to travel on the alternative route.

    There is no southbound exit from the new motorway before the Northern Gateway Toll Road. This means southbound travellers would not be able to choose the toll-free option using the current SH1 and scenic Hibiscus Coast Highway (previously State Highway 17) via Ōrewa if they joined near Warkworth.  

    If travelling south and there was a toll in place on Pūhoi to Warkworth, you would need to plan your route in advance if you wish to take the toll-free route. Your route options will be well signposted.

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  •   Why are the tolling and State Highway 1 L Phillips Road (near SheepWorld) to Pūhoi speed review consultations happening at the same time?

    Waka Kotahi is working to ensure safe, resilient and reliable travel between Pūhoi and Warkworth.

    We acknowledge that the new motorway and the current state highway are and will continue to be linked, and we want to ensure transparency on our proposals across the area and coordinate feedback from the community on each of these.  We also want to ensure that people can give informed feedback by understanding both the speed and the tolling proposals in the area.

    Speed review proposal and how to have your say(external link)

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Tolling infrastructure and payment