1. Southern California Association of Governments Resolving Regional Challenges Transportation Planning Applications Conference Daytona, Beach, FL Keith L. Killough, AICP – Director, Information Services Southern California Association of Governments Value Analysis of Truck Toll Lanes in Southern California

2. Southern California Association of Governments Resolving Regional Challenges Presentation Overview Background & Problem Statement Reliability Methodology Methodology Application Investment Assessment Conclusions

3. Southern California Association of Governments Resolving Regional Challenges LA/Long Beach Port Complex is Largest in the U.S. and 5th in the World

4. Southern California Association of Governments Resolving Regional Challenges Ports handle one third of all container traffic in U.S. and nearly two-thirds of containers from Asia Over 70% of imports pass through to other markets

5. 0% 2% 4% 6% 8% 10% 12% 14% 16% % SCAG Jobs Leisure and Hosp. 9.6 Other Services 3.5 Educ. & Health Services 10.6 Constr. 4.8 Prof. & Bus. Services 14.1 Manf. 12.1 Logis- tics 8.1 Gov’t. 14.9 Financial Activities 7.5 Motion Picture 1.7 1 out of 12 jobs in 2003 The Logistics Industry Provides Jobs to 8% of Southern Californians

6. Southern California Association of Governments Resolving Regional Challenges Average weekly pay for all industries is $749 0$ $200 $400 $600 $800 $1000 $1200 $1400 $1600 $ Weekly Pay Leisure and Hospitality $400 Other Services $413 Educ. & Health Services $718 Constr. $777 Prof. & Bus. Services $811 Manf. $843 Logistics $847 Gov’t. $866 Financial Activities $1194 Motion Picture $1353 1 of highest paying And Those Jobs Pay Well

7. Southern California Association of Governments Resolving Regional Challenges Challenge: Congestion Goods movement is a major contributor to traffic congestion and a bottleneck to future growth. I-710 Typical Day I-710 During 2002 Port Lockout

8. Southern California Association of Governments Resolving Regional Challenges 9.5 13.2 18.3 36.0 44.7 Revised Estimate 19992005201020202030 6.9 9.0 12.3 23.4 Original Estimate In Million TEU’s (20’ Equivalent Units) Source: POLA, POLB Total LA/Long Beach Container Growth Projected to Triple in 25 Years 25.2

9. Southern California Association of Governments Resolving Regional Challenges Congestion Jeopardizes Our Economic Advantage Without improvements, nothing will be moving By 2025 Projected to nearly double

10. Southern California Association of Governments Resolving Regional Challenges Associated Pollution Has Created a Health Crisis The region continues to have the worst air quality in the U.S. Particulate emissions from ships, locomotives & planes from the ports are projected to increase

11. Southern California Association of Governments Resolving Regional Challenges Estimated Risk of Cancer from Airborne Toxics: Excluding Diesel Source: SCAQMD, Multiple Air Toxics Exposure Study II, March 2000 Cancers per million 100-200 200-300 300-400 400-600 600-800

12. Southern California Association of Governments Resolving Regional Challenges Source: SCAQMD, Multiple Air Toxics Exposure Study II, March 2000 Cancers per million 200-300 300- 400 400-600 600-800 800-1000 1000-1200 Over1200 Estimated Risk of Cancer from Airborne Toxics: Including Diesel

13. Southern California Association of Governments Resolving Regional Challenges Source: South Coast Air Quality Management District & California Air Resources Board 2007 52% of national exposure to PM2.5 in excess of the federal standard occurs in the South Coast Air Basin Diesel Particulates Are at the Root of the Problem 5,400 annual cases of premature death are attributable to this exposure

14. Southern California Association of Governments Resolving Regional Challenges Heavy Duty Diesel Truck Particulate Speed Correction Factors Source: California Air Resources Board, 2007 EMFAC Model

15. Southern California Association of Governments Resolving Regional Challenges Not Nearly Enough Federal and State Funds to Fix the Problems Dramatic growth in traffic is running head-long into limited transportation funding and high infrastructure improvement costs.

16. Southern California Association of Governments Resolving Regional Challenges Does investment required to make transportation infrastructure improvements & employ clean air strategies make business sense?

17. Southern California Association of Governments Resolving Regional Challenges Two Productivity Gains Shippers’ inventory savings Transporters’ efficiency gains

18. Southern California Association of Governments Resolving Regional Challenges Carrying Less Inventory Saves Money 35% Less Inventory U.S. Inventory to Sales Ratios: 1985 - 2004

19. Southern California Association of Governments Resolving Regional Challenges Key Study Finding: Shippers are more sensitive to congestion (delay) than to the cost of transportation Port & Modal Elasticity Study Study Conducted by Leachman and Associates LLC - Sept. 2005

20. Southern California Association of Governments Resolving Regional Challenges “Just-In-Time” Savings The trans-loading of weekly shipments from Asia affords large, nation-wide retailers an 18-20% reduction in their total pipeline plus safety stock inventory compared to direct shipping from Asia. Assuming a 6% average error in nationwide one-week-ahead sales forecasts Leachman & Associates LLC

21. Southern California Association of Governments Resolving Regional Challenges Consolidated Shipping Time Savings ORDER Nation-wide order placed with Asian Factory 75 - 100 DAYS OUT: Depart Destination Ports 5 - 9 Retail Stores Arrive at Destinations 1- 9 Fewer ships to select Trans-Loading Ports 25 - 37 Allocated Only 6 - 18 Days Out Average of one month advantage Goods can be allocated just before vessel arrives Leachman & Associates LLC

22. Southern California Association of Governments Resolving Regional Challenges “Just-In-Time” Savings The savings amount to over $1 Billion annually on inventory interest alone. Leachman & Associates LLC

23. Southern California Association of Governments Resolving Regional Challenges Reliability Methodology

24. Southern California Association of Governments Resolving Regional Challenges The Value of Time $25 to $200 per hour depending on cargo Trucking Industry Value of time FHWA Freight Management and Operations: Measuring Travel Time in Freight-Significant Corridors www.ops.dot.gov/freight/time.htm

25. Southern California Association of Governments Resolving Regional Challenges Reliability Assessment Definitions Travel Time Index: Ratio of the average travel time to the uncongested travel time. Planning Time Index: 95th percentile of the Travel Time Index. Extra time most travelers include when planning peak period trips. Buffer Time Index: The extra time (buffer) needed to ensure on-time arrival for most trips.

26. Southern California Association of Governments Resolving Regional Challenges % more time Time of Day (non-holiday weekdays) 9 PM 5 AM 6 AM 7 AM 12 PM 1 PM 5 PM 6 PM 7 PM 8 AM 9 AM 10 AM 11 AM 2 PM 3 PM 4 PM 8 PM 10 PM 10 2030405060708090100 110 Buffer Time to ensure on-time arrival for most trips Travel Time Mobility Monitoring Program Texas Transportation Institute. FHA Planning Time in 2030 Index by Time-of-Day

27. Southern California Association of Governments Resolving Regional Challenges Travel Time Index Freeway Travel Rate Freeway Free-flow Rate x Freeway Peak Period VMT + Principal Arterial Street Travel Rate Principal Arterial Street Free-flow Rate Principal Arterial Street Peak Period VMT Freeway Peak Period VMT + Principal Arterial Street Peak Period VMT x Buffer Time Index Average Travel Rate (in minutes per mile) 95 th Percentile Travel Rate (in minutes per mile) - Average Travel Rate (in minutes per mile) x100% Weighted Average of All Sections (using VMT)

28. Southern California Association of Governments Resolving Regional Challenges Caltrans PeMS Sensor Locations

29. Southern California Association of Governments Resolving Regional Challenges SCAG Travel Time Reliability A.M. Peak Morning Peak Period (6a - 9a) Buffer Time Index = 1.3178Ln(Travel Time Index) + 0.0972 R 2 = 0.6986 0% 20% 40% 60% 80% 100% 120% 140% 1.0 1.11.21.31.41.51.61.71.81.92.0 Travel Time Index (Congestion Level) Buffer Time Index (Reliability)

30. Southern California Association of Governments Resolving Regional Challenges SCAG Travel Time Reliability Mid-day Midday Period (9a - 4p) Buffer Time Index = 2.162Ln(Travel Time Index) + 0.0953 R 2 = 0.6304 0% 20% 40% 60% 80% 100% 120% 140% 1.01.11.21.31.41.51.61.7 Travel Time Index (Congestion Level) Buffer Time Index (Reliability)

31. Southern California Association of Governments Resolving Regional Challenges Methodology Application

32. Southern California Association of Governments Resolving Regional Challenges The investments and their price tags

33. Southern California Association of Governments Resolving Regional Challenges Dedicated Truck Lanes I - 710 18.0 miles East/West 37.8 miles I - 15 86.0 miles 2 Truck Lanes in Each Direction

34. Southern California Association of Governments Resolving Regional Challenges Separated from Car Lanes Dedicated Right-of-Ways or Elevated Roadway

35. Southern California Association of Governments Resolving Regional Challenges The Cost Dedicated Truck Lanes Additional Rail Tracks $16.5 In Billions $3.4 Lanes/Tracks Only Other Operational Improvements TOTAL $3.5 $2.6 $20.0 $6.0 TOTAL $26.0 TOTAL with $10B Environmental Mitigation $36.0

36. Southern California Association of Governments Resolving Regional Challenges Methodology Application Year 2030 Planning Design Year SCAG Regional Travel Simulation Model Analysis – No Project Alternative – Truck Toll Lane Alternative: 2 lanes each direction Toll Cost = $0.86/mile I-710 Long Beach Freeway SR 60 Pomona Freeway I-15 (Ontario to Victorville) Compare toll costs to travel time & reliability savings based on trucking industry value-of-time

37. Southern California Association of Governments Resolving Regional Challenges The Public/Private Solution Container Fees & Tolls to USE the facilities AFTER they are built Tax-Exempt Bonds and Tax Credit Financing to BUILD the facilities

38. Southern California Association of Governments Resolving Regional Challenges What are speed and reliability worth to users of the system?

39. Southern California Association of Governments Resolving Regional Challenges Travel Time In the Year 2030 AM Peak Travel Planning Time in Hours Hours: LA Business District Ontario Victorville 2.0 4.7 7.6 Hours:.5 1.5 4.8 With Truck Lanes

40. Southern California Association of Governments Resolving Regional Challenges Truckway vs No Project Speed Changes on Auto Traffic Lanes Speed Changes

41. Southern California Association of Governments Resolving Regional Challenges Cash Value of Time Savings with Truck Lanes AM Peak Travel @$73 per hour Value: LA Business District Ontario Victorville $103 $233 $345 Extra Trip Potential 3.4 3.1 2.3

42. Southern California Association of Governments Resolving Regional Challenges If truckers paid an $.86/mile toll to use the truckways, what would be the ROI?

43. Southern California Association of Governments Resolving Regional Challenges Return on Investment at A.M. Peak Travel Times - 2030 Warehouse District Downtown To From Ontario To From Victorville To From Toll @ $.86/Mile$17 $32 $64 Time Value Savings $86 $101 $201 $329 $281 $336 Value @ $73/hr $103 $118 $233 $361 $345 $490 ROI Ratio 6:1 7:1 7:1 11:1 5:1 8:1

44. Southern California Association of Governments Resolving Regional Challenges $1 Invested = $5 to $11 Return

45. Southern California Association of Governments Resolving Regional Challenges Premise 1. Infrastructure improvements will reduce transit time for shippers and improve efficiency and reliability. 2. Reliability has a real dollar value to shippers. 3. The value of the time saved will be significantly greater than the investment to achieve the time saved.

46. Southern California Association of Governments Resolving Regional Challenges Two “What-If” Scenarios As-Is Scenario Fees imposed but NOT used to provide regional congestion relief Congestion Relief Scenario Fees and/or tolls paid by users of newly constructed highway and rail systems that provide regional congestion relief. Study Conducted by Leachman and Associates LLC - Sept. 2005

47. Southern California Association of Governments Resolving Regional Challenges Fees Imposed with No Infrastructure Improvements FEUs in millions 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 2004 Annual Volume $306090120150180210240270300330360390420450480 Container Fee (per FEU) in dollars Total Volume Trans Loading Volume Fairly inelastic until fees in the $180 range are introduced Much more inelastic than direct shipping

48. Southern California Association of Governments Resolving Regional Challenges Private Sector Investment in Congestion Relief FEUs in millions 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 2004 Annual Volume Total Volume $306090120150180210240270300330360390420450480 Container Fee (per FEU) in dollars Trans Loading Volume Congestion relief makes ports more attractive At $200, volume is only 4.3% below No Fee:No Improvement Scenario Trans-load volume is even higher

49. Southern California Association of Governments Resolving Regional Challenges Observations & Considerations Travel time reliability can be more important to freight movement than the actual travel time Return on Investment ratios vary by facility & time of day A combination of truck toll fees & additional funds will likely be required to cover facility capital costs Additional options being explored: – Maglev Freight System – Electrified rail & highway systems

50. Southern California Association of Governments Resolving Regional Challenges Conclusions Goods movement is critical to the economies of Southern California & the nation Goods movement particulate emissions contribute to the regional health crisis Speed & reliability enhancements benefit goods movement & reduce health impacts Reliability is measurable Reliability improvements will offset toll costs

51. Southern California Association of Governments Resolving Regional Challenges Transportation Planning Applications Conference Daytona, Beach, FL Keith L. Killough, AICP – Director, Information Services Southern California Association of Governments Value Analysis of Truck Toll Lanes in Southern California

52. Southern California Association of Governments Resolving Regional Challenges Thank You Comments and Questions?