The Virginia Supreme Court affirmed a State Corporation Commission decision denying a toll increase for the Dulles Greenway, rejecting constitutional challenges from the private toll road operator in a ruling issued July 17, 2025.
In *Toll Road Investors Partnership II v. State Corporation Commission*, the state's highest court upheld the Commission's authority to regulate toll rates for the 14-mile limited-access highway connecting Leesburg to the Dulles Toll Road in Loudoun County. Justice Stephen R. McCullough authored the unanimous opinion affirming the regulatory decision.
Toll Road Investors Partnership II, known as TRIP II, had appealed the Commission's denial of its toll increase request, arguing that the agency misapplied statutory criteria for rate setting. More significantly, the company claimed that denying the toll increase constituted an uncompensated taking under both the U.S. Constitution and Virginia Constitution.
The Virginia Supreme Court rejected both arguments, concluding that the State Corporation Commission's decision should be affirmed in its entirety.
The dispute centers on the Dulles Greenway, a privately funded toll road that emerged from Virginia's efforts to address rapid population growth in Northern Virginia counties during the late 1980s. Faced with significant infrastructure needs and limited state funding, the General Assembly enacted the Virginia Highway Corporation Act of 1988, codified in Virginia Code Section 56-535.
The legislation reflected the General Assembly's finding "that there is a compelling public need for rapid construction of safe and efficient highways for the purpose of travel within the Commonwealth and that it is in the public interest to encourage construction of additional, safe, convenient, and economic highway facilities by private parties," according to Virginia Code Section 56-537.
Under this framework, the General Assembly granted the State Corporation Commission regulatory authority over toll road operators, as specified in Virginia Code Section 56-542. This authority includes oversight of toll rates charged by private highway companies.
The Toll Road Corporation of Virginia initially developed the Greenway project, anticipating construction costs of $146 million. However, the final price tag reached $315 million, more than double the original projection. The road was built entirely with private funding, without state financial assistance.
Original toll projections contemplated rates starting at $1.50 per vehicle and reaching $3.25 per vehicle by 2010. The significant cost overruns and subsequent financial pressures likely contributed to TRIP II's request for toll increases beyond the originally projected rates.
The constitutional takings argument raised by TRIP II represents a significant legal challenge to state regulatory authority over private infrastructure operators. Under the Fifth Amendment to the U.S. Constitution and similar provisions in state constitutions, government actions that deprive private property owners of economically viable use of their property may require just compensation.
Private toll road operators often argue that rate regulation that prevents recovery of investment costs and reasonable returns constitutes a regulatory taking. These arguments typically assert that denying rate increases effectively confiscates private property by preventing owners from earning sufficient revenue to justify their investment.
However, courts have generally recognized broad state authority to regulate utility rates, including toll road rates, provided the regulation permits operators to earn a reasonable return on their investment. The Virginia Supreme Court's affirmance of the Commission's decision suggests the regulatory framework adequately protects the operator's property rights while maintaining state oversight.
The decision reinforces the State Corporation Commission's role as the primary regulator of Virginia's private toll roads. The Commission must balance multiple factors when reviewing rate requests, including the operator's financial needs, public interest considerations, and statutory criteria governing toll road regulation.
For motorists using the Dulles Greenway, the decision means toll rates will remain at current levels rather than increasing as requested by TRIP II. The Greenway serves as a critical transportation link for Loudoun County residents and commuters traveling between rapidly growing suburban areas and employment centers in the Washington metropolitan region.
The ruling also has broader implications for public-private partnerships in infrastructure development. Virginia's experience with private toll roads provides a model for other states considering similar arrangements to address funding shortfalls for transportation projects.
The case demonstrates the ongoing tension between encouraging private investment in public infrastructure and maintaining regulatory oversight to protect public interests. While the Virginia Highway Corporation Act was designed to facilitate private highway development, the State Corporation Commission retains authority to ensure toll rates remain reasonable.
The constitutional takings challenge reflects broader debates about regulatory authority over privately owned public utilities. Similar disputes have arisen in other regulated industries where private companies argue that rate regulation prevents adequate returns on investment.
The Virginia Supreme Court's decision in this case will likely influence future rate proceedings before the State Corporation Commission and may affect other private toll road operators considering similar constitutional challenges to rate denials.