The Cape Fear Memorial Bridge replacement has proven far more expensive than early estimates — and delays have only driven the expected costs of construction up. In the face of those tremendous challenges, a toll bridge is starting to look inevitable, pending some unforeseen funding miracle.
There are many potential knock-on effects for the toll bridge, ranging from changes in traffic patterns, reduced congestion, and significant changes to land values and rents in communities on each side of the river.
Disentangling Wilmington and Leland’s intertwined economy
The first impact of the toll bridge will be a shift in traffic patterns — fewer cars will move between Leland and Wilmington each day in response to the increased cost for such trips. It could be people deciding to shop and eat on their own side of the river, or consolidating trips into one day to save on the toll.
It’ll also push rents down in Leland, and up in Wilmington, said UNCW Regional Economist Mouhcine Guettabi.
“Living on the other side of the bridge becomes at the margin less attractive, because you're bearing an additional $1,000 a year in additional expenditures,” he explained. “Right now, a lot of lower-wage workers are choosing to live in Brunswick County because rent is cheaper.”
Guettabi expects that a toll would make the current price differential up, as the current cost of that commute is lower.
“So if the additional costs of paying for the toll exceed whatever savings you're incurring right now, that may push more people to choose to live inside New Hanover County. So at the margin, land or rents are probably going to go up inside New Hanover County, because people are going to be choosing to avoid paying for the toll," he said, adding that the inverse will happen in Brunswick County.
This impact could be substantial, because 52,000 people commute into New Hanover County each day. That’s about a third of the workforce, according to state data.
That means the region will see a jump in the land value on the eastern side of the river, and a drop on the western side. And populations may shift, too.
“People sort into places that make sense,” Guettabi explained. “And so I think you'll see this fairly quick jump in rents inside New Hanover, probably a small drop outside of New Hanover, or into Brunswick, and then with time, you see people now starting to adapt.”
Guettabi predicts some economic consolidation on each side of the river. While there will be heavier pressure on New Hanover County to provide sufficient housing for its workforce, Leland might be able to benefit economically if it can move fast enough. After all, the well-off retirees who’ve moved to that area and bought homes will still want to go shopping.
“Leland [might] think harder about putting in more shops, more restaurants, to potentially maintain some of the leakage that currently comes towards New Hanover County,” Guettabi said. “And so I think it'll be interesting to see both how quick, how responsive are individuals in terms of these relocation decisions, and whether or not local government developers respond to potentially meet these changing demands of residents in Leland.”
It’s unlikely that Leland will be able to bring in the same level of commercial offerings for shoppers that the City of Wilmington can, but they could up their game to attract more spending from residents within the town and county.
Workforce impacts
The rising housing costs in New Hanover County driven by the toll could have substantial impacts on the workforce, particularly for low-wage workers. The proposed toll, set at $4 a day ($2 for a trip each way over the river), could be really substantial for certain workers.
“Whenever you think about tolling, I think the equity concerns, or distributional concerns, are probably the most pronounced ones,” Guettabi said, “because tolling tends to be regressive.”
It’s possible to mitigate that regressive component of the toll with discounts that are targeted to specific populations. But that kind of policy is only possible under a public-private partnership under state law. Still, Guettabi said it could be worthwhile to consider a PPP for that reason — to protect low-wage workers living in Leland, who are more likely to change their behaviors in reaction to a toll bridge.
That’s one option for mitigation, but Guettabi also thinks the local government could play a major role in protecting low-wage workers who will be disproportionately affected by the toll.
“Do you address the housing needs inside of New Hanover County and tackle them directly by building affordable housing, or by building more multi-family housing?” he asked.
Otherwise, “You're going to start seeing increases in prices for the goods and services that we consume, because if you're a restaurant and you want to help your worker pay for that bridge toll, then that may end up showing up in your check for whatever things that you consume.”
If those employers don’t help their employees make ends meet, they may struggle to hire or retain workers at the wages they offer, as high housing costs and the toll put pressure on low-income residents to relocate from the area. And as WHQR has previously reported, low-income residents are already being pushed out.
Using a PPP to make discounts possible is one very good option, Guettabi said, but it should be done thoughtfully.
“Think about discounts. Think about who bears the burden of these additional costs," he said. "How does it shift the attractiveness of New Hanover County? How does it shift the attractiveness of the area in general, and does it make at the margin, attracting and retaining workers, especially in certain sectors, harder or easier?”
Traffic impacts
The toll will change traffic patterns, there is no doubt.
“Traffic diversion has been found in just about every situation where we've had some form of tolling, because some people are going to choose to avoid the toll, and therefore they're going to be looking for alternative routes,” Guettabi said.
When the Cape Fear Memorial Bridge had significant lane closures for five months in 2024, it meant nearly all traffic between Brunswick and New Hanover Counties was diverted to the Isabel Holmes Bridge in the North end of Wilmington or the Dan Cameron Bridge along I-140.
Traffic was frequently backed up on 5th and 3rd streets in downtown Wilmington. Guettabi doesn’t expect such a drastic impact with the toll, but there will be a shift of traffic to the north end of town.
“Behavioral econ tells us, obviously some people are going to choose to avoid the bridge that is tolled, and therefore they're going to be seeking other alternatives,” Guettabi said. “For some people, the toll is really attractive, because if you're a high-income earner and sitting in traffic for an hour costs you $400 an hour. Paying $4 is actually a huge improvement in quality of life, right?”
That means some residents — the wealthier ones — may actually benefit from the toll bridge because it will reduce traffic on their commute. But Guettabi said it will also reduce congestion overall.
“Yes, it will divert traffic to other places, but I think it will improve the flow of traffic in general, because people are going to be thinking more closely about times of arrival, when they go out, which routes they choose,” he said. “Most city, large cities, have found fairly significant declines in congestion or times waiting.”
That has significant environmental benefits, because it stops cars from sitting idle for long periods of time.
Bridge Cost
The bottom line is that waiting is costly. Between 2020 and 2026, the price tag for the Cape Fear Memorial Bridge replacement has gone from $245 million to $1.1 billion. A $242 million federal grant that was intended to cover half the cost now covers less than a quarter of it. While some of that has to do with the design decisions thanks to the U.S. Army Corps of Engineers and Coast Guard, much of it has to do with general cost increases from inflation and other macroeconomic factors.
“The cost of materials have increased quite significantly,” Guettabi said. “I think that waiting potentially makes the feasibility even more difficult, makes this project penciling out even more difficult. And obviously, the growth of the area continues to put pressure on the bridge, the ports growth, the airports growth. So more traffic, more people. I think that it would behoove us to address it sooner rather than later, both from a quality of life standpoint, but also from a cost consideration.”
There are creative solutions possible: namely, a tri-county transit tax could make a bridge replacement possible without a toll, using taxpayer money. But a PPP from an unsolicited bid or another contractor could also make it happen. And Guettabi suggested it’s unwise to discount a toll entirely.
“I think that there are people who feel very, very strongly about opposing a toll, and I completely understand it, but I think that there are ways, as we've discussed, to potentially mitigate the negative consequences,” he said. “What we want to ultimately try to do is to minimize these behavioral responses. If we don't want too many people to shift where they live, or we don't want the restaurant downtown to start struggling to hire somebody. What can we do to ensure that we not eliminate but mitigate some of these costs?”
It’s a question elected officials across the region will need to weigh carefully as they consider whether to accept an unsolicited bid to build a toll bridge.
