Karen Gutteridge has a love-hate relationship with Highway 407.

She loves that the tollway can get her reliably from her Burlington home to her office in Richmond Hill, but she knows she’ll be faced with a whopping bill since her company moved from Mississauga this fall.

“I have to take four different highways – the QEW, the 427, 401 and 404 – to get to the office,” said Gutteridge, adding she is always tuned to the latest traffic reporter, prepared to detour to the 407, if traffic begins to back up.

“I didn’t take it the other morning, and it took an hour and 45 minutes. That’s without an accident and no construction.”

But she worries about the cost, because it’s $21.48 one-way. “The whole time on I’m on the 407, I see another exit go by and all I can hear in my head is the cash register going off,” Gutteridge said.

“The traffic in the GTA is a nightmare. It is unreal. I can’t believe how many cars are on the road at 6 a.m,” she said, but she consistently takes the tollway on the return trip because the congestion is even worse in the evening.

That’s partly why the 407 – which first opened in 1997 – is steadily increasing its base of users, even though toll prices have also risen along with the highway’s popularity.

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The rates vary depending on time of day, zone and what type of vehicle. The average trip length is about 20 kilometres, with weekday rush hours between 7 a.m. and 9 a.m. and 4 p.m. and 6 p.m. being the busiest periods.

For cars, minivans and sport utility vehicles, prices range from 19.35 cents a kilometre during off-peak times to as much as 27.20 cents a kilometre during the highest-demand time.

Kevin Sack, 407 ETR’s vice-president, says the tollway is meeting its mandate, given an average of 380,000 vehicles are taking the highway on weekdays, up from 237,000 vehicles in 1999.

“It’s a success because we are fulfilling our mandate of relieving traffic,” he said. “It’s a tolled alternative that allows people a great choice, that allows them to save a lot of time,” Sack said, arguing users believe in the value proposition.

Poll

The number of users who pay for transponders – which automatically read the entry and exit point of vehicles – is more than 1 million now, or nearly 80 per cent of users. Without a transponder, drivers face an additional fee for every use.

Sack said the highway will continued to be widened, depending on demand, noting only the section between Highway 400 and 404 is at its ultimate capacity, with five lanes in each direction.

“For us, it’s about managing the traffic we have and we want more traffic. We want more people to try the 407,” he said.

The highway now stretches 108 kilometres from Burlington to Pickering, as wide as five lanes in some sections.

In 1999, the provincial Tory government issued a 99-year lease to 407 ETR for $3.107 billion. The 407 ETR is owned by a consortium led by Spain’s Cintra Infraestructuras S.A., the Canada Pension Plan Investment Board, and SNC-Lavalin.

Tollways are considered a lucrative investment for pension funds like the CPPIB.

In its latest results, the 407 International, shareholder group that owns 407 ETR, reported revenues of $224.8 million for the third quarter of 2013, up from $201.9 million in the same period a year earlier.

Net profits for the third quarter of this year were $69.3 million, up from $62.5 million.

Those profits have always sparked the anger of commuters who complained about the government’s decision to grant a long-term lease.

The provincial Liberal government has promised to extend the highway further east, with first section to Harmony Rd. in Oshawa to open in 2015, and as far as Highway 35/115 by 2020. It will also build two tollway connector roads to Highway 401.

Unlike the existing highway, the provincial government will build and own the extension as well as set the toll rates for the eastern section of the highway.

That is sure to spur more growth in Durham Region as businesses and new residential developments have sprouted up all along the highway 407 corridor since its construction.

“The expression, ‘Build it, and they will come,’ is a really a truism when it comes to the 407,” Sack said, adding that the closer an individual lives to the 407, the more likely they will use it as a commuter.

Part-time student Kathryn Oda, 24, realizes taking the 407 is a luxury that is eating into her budget as she travels from Markham to Brampton to an unpaid internship that is part of her master’s in social work program.

Oda shares an account with her sister Christyn, who travels to Humber College with her own transponder and car, and their combined bill can reach upwards of $1,300 a month.

Oda says they have tried to hide the 407 bill from their parents, who warn they are spending too much on the tollway.

Because the tollway doesn’t have barriers at entry and exit points, the bills come much later.

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“I think the thinking would be different if you got a ticket, and paid to get off, you would be done with it – you wouldn’t get a bill in the mail,” Sack said of the love-hate relationship. “People wouldn’t have the second half of the relationship. They would only have the good part.”

But Oda confesses she doesn’t want to leave more than two hours earlier to take alternate routes such the 401, Steeles Ave. or Major Mackenzie Dr., and arrive at work all stressed.

Her plan now is to look for work downtown, where she can use public transit, and hopefully ditch her car and her 407 bill.

Truckers know first-hand how much congestion exists on Highway 401, but Stephen Laskowski, senior vice-president of the Ontario Trucking Association, says unlike tolls in the U.S., the 407 is too expensive for trucking companies.

“The 407 isn’t even on their radar,” he said. “They don’t even bother to do the calculation.

“The 407 priced themselves out of the market with regards to commercial trucking,” said Laskowski, noting trucks would expect to pay a surcharge given it’s larger and a commercial vehicle, but given razor-thin margins, it’s not a viable option.

During peak times in the regular zone, large trucks pay 54.40 cents a kilometre and tractor-trailers pay 81.60 cents a kilometre

Laskowski argued trucking companies simply won’t be asking their customers if they could take the 407, saying the tolls are cost-prohibitive and not a price that customers are willing to pay.

He believes the tollway may be attractive for expedited freight, such a company whose assembly line is idled as it waits for a motor that is being flown into Pearson airport.

“Without it, the assembly line isn’t working,” he said. “Then, every second counts and then they will pay the premium.”

Laskowski concedes that Highway 407 has taken some commercial trucks off Highway 401, but says the tollway was not affordable from the beginning.

“If it was priced differently, you would see more commercial trucks off the 401,” he said.

The 407 ETR’s Sack says the toll company is aware of the concerns of the trucking industry. “A lot of companies operate on tight margins,” he said, arguing that “the math needs to be done around time savings and what the deadlines are to move goods.”

But more tolls are likely to come as a way to deal with the growing gridlock in the GTA.

Harry Kitchen, a professor emeritus at Trent University, has long believed tolls are needed to alleviate congestion.

“The great thing about the 407 is there are alternatives. It’s a simple choice,” he said. “If you want to travel faster, you pay a price to travel faster. You want a better service. You pay for it.”

Given the gridlock in the GTA, Kitchen believes tolling is inevitable – possibly starting out with tolls on high occupancy vehicle lanes.

“I think the crisis has become so great in Toronto, basically everybody realizes they have to do something,” he said, adding there’s been a shift in attitudes, with a willingness to consider it.

“It’s inevitable. Is it going to come in my lifetime? I don’t know,” said Kitchen, an economist. “It will come in the GTA. It has to.”

Sevag Sagherian, who produces and directs television commercials for Impact Films, says he takes Highway 407 daily to ensure he’s on time for auditions and film shoots.

“It’s become a no-brainer. My time is worth the extra money. I hate saying it, and I hate paying it,” said Sagherian, who is a dual U.S. citizen, who has lived in Los Angeles with its crazy traffic.

“In LA, there are different routes, different highways,” he said, adding when the Don Valley Parkway is blocked, there is no alternative. “If the DVP was tolled, I would sure as heck take it.”

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