1. Tolling and Congestion Pricing Patrick DeCorla-Souza Office of Innovative Program Delivery Federal Highway Administration Presentation to Transportation Advisory Group The Council of State Governments December 4, 2008

2. Overview Rationale for congestion pricing Congestion pricing examples worldwide Recent developments

3. Ways to Reduce Congestion Increase capacity: –Physical capacity –Management and operations Reduce demand –Provide attractive “substitutes” for driving during rush hours –Congestion pricing

4. Why Congestion Pricing? Manages demand: Balances demand with supply Generates revenue Signals where additional capacity may be economically justified

5. How Congestion Pricing Works Variable toll makes the cost borne by user reflect the actual social cost of driving Willingness to pay – people will choose to drive as long as the benefit they get is equal to the cost they face Others will shift to using substitutes

6. Substitutes Alternative modes with traveler information –Transit –Ridesharing Alternative destinations –Telecommuting Alternative times –Flextime, staggered work hours

7. Overview Rationale for congestion pricing Congestion pricing examples worldwide US DOT’s Congestion Initiative

8. Types of Congestion Pricing Managed Lanes: –Separate lanes on freeways managed with variable tolls Managed Highways: –All lanes on highway managed with variable tolls Area or Cordon Pricing: –User charges to enter or drive in an area

9. Managed Lanes Orange County, CA SR 91, Orange County, CA - Four new lanes in median, 10 miles Tolls are $1.20 to $10.00

10. Managed Lanes Fixed peak vs. off- peak toll differential Toll rates set to maintain high performance Houston I-10 and US 290 SR 91 in Orange Co., CA I-15, San Diego I-394, Minneapolis I-25, Denver SR 167, Seattle

11. Maximum Toll Rates: San Diego Evening Period Northbound Maximum Toll Schedule for I-15 HOT Lanes, San Diego, California $4.00 $3.00 $2.00 $1.00 $0.75 3:00 - 3:303:30 - 4:004:00 - 4:304:30 - 5:005:00 - 5:305:30 - 6:006:00 - 6:306:30 - 7:00

12. Managed Highways Variable pricing on the State Route 520 floating bridge. –Tolls on the existing bridge –Will help pay for the new bridge.

13. Managed Highways Fixed peak vs. off- peak toll differential Toll rates set to maintain high performance Ft Myers bridges NYC crossings Orange Co., CA Dulles Greenway France & S. Korea Singapore expressways and major arterials

14. 65 kph45 kph Increase Decrease Toll rates Tolls Rates on Singapore Expressways Charges vary from 50 cents to $2.50

15. Cordon or Area Pricing Fixed peak vs. off- peak toll differential Toll rates set to maintain high performance London (flat fee) Stockholm (variable fees) Singapore CBD cordon

16. Stockholm Toll Rates

17. Overview Rationale for congestion pricing Congestion pricing examples worldwide Recent developments

18. USDOT Urban Partnership Program Key: –Tolls that vary with level of demand Support strategies: –Transit –Telecommuting and flextime –Technology: Multimodal traveler information Active traffic management and operations

19. Urban Partners Miami Minneapolis -St. Paul San Francisco Seattle Los Angeles Chicago

20. HOT Network Study: Washington DC Annual revenue: $1.5 to $2.8 billion annually Capital cost recovery: 43% to 48% for new lanes 58% to 110% with pricing of existing general purpose lanes

21. “Traffic Choices” Study: Seattle, WA Present value of revenues = $87 B

22. Area Pricing in New York City Annual net revenue: $500 million Dedicated to transit

23. Public Opinion Surveys Managed Lanes: –60-70% approval from all income groups Managed Highways: –Seattle: 64-74% approval for new tolls on currently free SR 520 bridge which needs rehabilitation Area Pricing: –New York City: 60% approval (67% approval in City Council vote)

24. Summary Congestion pricing has many benefits Operates successfully worldwide Bold and innovative projects are underway in several U.S. cities Studies suggest promise in addressing funding shortfalls Public opinion can be positive

25. For more information contact: Patrick DeCorla-Souza Office of Innovative Program Delivery Federal Highway Administration 202-366-4076 Patrick.decorla-souza@dot.gov www.FightGridlockNow.gov