A map of toll gates network in Shanxi Province published in a motorists' internet forum

There are nearly 200 toll gates on the roads of Shanxi Province and although the provincial government has promised to close half of them, no schedule for the shutdown has been published, China Youth Daily reported.

Vested interests behind toll gates

Shanxi's problem of proliferating toll gates drew public attention last October when a map published in a motorists' Internet forum logged the location of nearly 200 of them, more than half on state-funded grade-two roads. The government has said it plans to close 104 of them but has not said when. So far, no gates have been closed.

Drivers are skeptical of government promises to remove toll gates, saying that "vested interests" who benefit from the toll money would keep the gates in place.

By the end of 2007, 204, 000 kilometers of China's roads out of a total of 3.6 million kilometers had been toll roads.

16 years to scrap tolls

Guo Quanying, an official from the Shanxi Provincial Department of Transport said closing the tool stations would be a lengthy process because the revenue and expenditure of each toll gate would have to be audited. A complete audit for each toll gate may take about half a year, Guo said.

The revenue from toll gates will have to be replaced with government subsidies as the funds are needed to repay loans and carry out road maintenance. The central government has set aside only 26 billion yuan (US$3.8 billion) annually to fund the shutdown of toll gates. This sum is inadequate to fund large scale shutdowns in each province.

Outstanding loans on grade-two roads in Shanxi Province amount to 32.1 billion yuan (US$4.7 billion), and 16 billion yuan (US$2.3 billion) in subsidies will be needed to fund toll gate closures. On present projections it will take around 16 years to raise the money, Guo told China Youth Daily.

Fees collected illegally

Under pressure from the bad publicity created by the Internet map, and the publication of a nationwide plan to close toll gates, the provincial government stopped extending the permit of toll gate operators. But some gates carried on charging regardless.

Jingfang Toll Station continued to charge vehicles after its permit expired in December 2008. Finally a local driver complained that the toll gate was imposing charges illegally and the local price bureau told the operators to stop collecting fees.

But according to China Youth Daily, some toll gates in Shangxi Province are still collecting fees despite having no permission to do so.

Fees repay loans is a "true lie"

Tolls are supposed to be used to replay loans used for road construction with a maximum collection period of 20 years, but only one toll station in Shangxi Province has been closed down after repaying road construction loans, according to Guo.

90 percent of toll gates in the province have had their collection permits extended usually for the maximum period of 20 years. The provincial government granted extensions to 40 toll stations in August 2006 on the grounds that they still had outstanding loans.

"That fee collection is principally intended to repay loans has become a true lie," said an insider.

Sweetheart deals with banks

Roads in Shanxi Province are often partially funded by bank loans. Then road operators charge vehicles to repay the loans.

Toll roads projects are sweetheart deals for commercial banks, since the loans have little risk attached. Commercial banks actually prefer road operators to extend their repayment periods because that means a stable income stream for them over a long period.

Where does the money go?

Some of the fees collected by toll stations are used for other road construction projects. Toll roads and toll gates can be sold or mortgaged to raise funds for building other roads. The rights to collect fees on at least 18 toll highways have been illegally sold in Shangxi, according to an audit report.

The charges on pay roads are also invested in road development enterprises, which are often managed by local highway bureaus. There are dozens of road development enterprises connected with toll highways in Shanxi, based on a survey of China Youth Daily.

(China.org.cn by Yang Xi, March 27, 2009)