Set to take effect Sept. 30, a 45 percent toll increase imposed by the state Thruway Authority for large commercial vehicles has north country trucking carriers and distributors preparing to pass on higher costs to their customers
As a result, industry experts say, consumers can expect prices to go up on everything from bread to lumber.
Operating a trucking business in New York is challenging because of tight regulations and high gas prices. But increasing the toll for 18-wheelers could make this one of the worst states for a trucker to drive in the Northeast, said Joseph T. Teal, vice president of Teal’s Express Inc., 224411 Teal Drive. The carrier, which has 11 distribution centers across the Northeast, completes most of its travels out of state along the Thruway with its fleet of 126 trucks.
“Our Thruway bill runs between $10,000 to $20,000 per month depending on how much we’re on the freeway,” Mr. Teal said. With a 45 percent toll increase, Teal’s annual cost could be an additional $100,000 or more.
While the company doesn’t want to pass on higher prices to its customers, he said, it likely won’t have a choice unless the authority votes to repeal the law, which it approved in May, before the end of the month.
“As everything goes up, our bottom line starts to disappear,” he said. “We’re going to try to absorb the costs when they go up, but (our customers) will probably be faced with the same problem we are. If it costs more to get products on their shelves, they’re going to raise prices. It affects the guy who’s buying a loaf of bread, gallon of milk. The lady that’s buying a pair of sneakers.”
Mr. Teal said the carrier draws about $20 million a year of its annual revenue by shipping products to businesses in the north country. In the Watertown area, examples include White’s Lumber, Samaritan Medical Center and other hospitals, auto dealerships including Davidson’s and Fuccillo and manufacturers at Jefferson County Corporate Park off Coffeen Street.
The authority has said it is increasing the tolls on large trucks because they are responsible for most of the damage to roads and bridges. The toll now for a three-axle truck traveling from Buffalo to New York City is about $88. But that would increase to $127 under the agency’s plan.
At the same time, the authority plans to spend $436.5 million to maintain the state Canal System from 2013 to 2016.
“The largest problem with the agency is they’re still in charge of the Canal System, and that’s been the biggest draw on their financial venture,” Mr. Teal said.
Food distributor Renzi Brothers Inc., 90 Rail Drive, would be affected by higher costs for inbound and outbound truckloads because of the increased toll, co-owner John M. Renzi said. The food distributor has a fleet of 26 trucks doing business in six Northeast states from Ohio to Maine.
“Any trucker that delivers to me is going to charge me more and drive prices of goods up, and that’s going to impact how much I sell them for,” Mr. Renzi said.
Renzi Brothers, which does business with several local grocery stores, will make an effort to avoid raising prices, Mr. Renzi said. But if the food distributor can’t do so, costs eventually will trickle down to the consumer.
“I don’t think most distributors are going to eat the cost,” Mr. Renzi said. “They’re going to pass it on to the consumer. It will impact grocery, department and hardware stores, and any retail outlets getting their goods through trucking.”
The last time tolls were raised on the 641-mile highway was in 2010, when the average toll for all drivers was hiked by more than 25 percent.