Convergence of Transportation Policy and RFID

Enabler of Future Transportation Policy

Chris BodyMark IVVice President, Business Development

Transportation MegaTrends

• Increased Vehicle Miles of Travel (VMT) –Increased 38 Percent since 1990

• Increasing Congestion and Lengthening Commutes

• Limited funds for Road Capacity Enhancements

• Privatization/ Concessions are crosscutting issue

• Is the Gas Tax Dead?

Policy Solution - Apply the Invisible Hand

• Our Transportation, esp. Road, Resources are not allocated efficiently

• Price Cap = Scarcity = Out of Equilibrium

• Match cost of driving with cost of congestion

• No incentives to drive less or use alternate routes or modes

• GPS & RFID can assist in increasing the funding and spreading demand

• Mature Technology, Developed Policy– Electronic Tolling, E-ZPass, Fast-Track

• Mature Technology, Developing Policy– HOT Lanes

• Mature Technology, Immature Policy– Congestion Pricing

Apply Market Incentives in Two Ways

• For the Consumer Demand for the Infrastructure

• For the Supply of Roadway Infrastructure

Technology Divergence

What is a HOT Lane?

• HOV + Tolls = HOT Lanes

• Newly Constructed or Converted Managed Facilities

• Maximizes Existing capacity

• Increases Throughput

• Cost Based on Value Pricing– HOVs - free– SOVs - Cost is Congestion Priced

• Toll Collection Typically Electronic - RFID

HOT Lanes

HOT Lanes on DC Beltway

• 14 Miles, 4 lanes in Median of 495

• All Electronic Tolling

• Operational in 2012

• Market Driven Variable Tolls

The Public Private Partnership

• VDOT– Will Retain Ownership of Facility– Will Oversee Operation

• Fluor/ Transurban– Construction– Operate & Maintain– Levels of Service Requirements

Plan View – DC Beltway HOT Lanes

HOT Lanes in Northern Virginia I-395/ 95

• Conversion of Existing HOV

• Construction of New Facility

• 56 Mile Reversible Lanes

• North Operational by 2010

• South by 2014

• $1B Cost

• Financed by Variable Tolls

• Fluor, Transurban

95/ 395 Lane Configuration

Future Expansion?

• I-95 Section 100 In Baltimore*

• Maryland InterCounty Connnector*

• Dulles Toll Road HOT Lanes

• Eastern Beltway Expansion

• Western Beltway Expansion

• Maryland Beltway Express Toll Lanes

• I-270 Express Toll Lanes

*- Under Construction

Congestion or Cordon Pricing

• Users must pay a fee to access a downtown area

• Time Variable and Direction Priced

• Tests Underway– London– Stockholm– Singapore– Coming to the U.S.?

• Typically RFID or Camera based

Currently in the Field

Stockholm - RFID and Camera Based London - Camera Based, for now

London

• Advantage: Transport for London Responsible for All Transportation In London

• Camera Toll Sites

• Original Fee $10 - increased to $16

• Operating Costs significantly higher than expected

• Considering switchover to tags for operating efficiency (20¢ vs. 60¢)

• Expanded Westward in 2007

London Congestion Pricing Zone

Source: Transport for London

THE RESULTS

Stockholm: Reduction in Traffic 04/05 – 04/06

-19%

-22%

-26%

-9%

-21%

Source: City of Stockholm

Something For Everyone?

• Congestion Reduction– London - 30% Reduction in Traffic, Half to other

modes

• Environmental Impact– Stockholm

• Emissions Down 14%– London

• CO2 Down 16%

• NOX Down 8%

• Particulate Matter Down15%

• Modal Shift– 50-60% to Public Transit– 20-30% Around Zone

Stockholm -

• After Test, 53-47 Advisory Vote

• New Government Working out Plan for a Portion of $$ For Road Improvements Outside of City

• Expected to be Re-Instated in August of 2007

Congestion Pricing – Coming to the U.S.

• $130M Allocated for Projects in 2007

• $175M in Next Year’s budget request

• Reality – will provide some political cover for local politicians

• Urban Partnership Agreements

New York Proposal

• $8 to Drive in Downtown District, incl. toll

• South of 86th Street

• FDR Drive and Westside Highway Free

• Some Vehicles Exempt

• Challenge: Support from Outlying Boroughs, esp. Queens

How Do We Pay for These New Projects

• Challenge:– Gas Tax is Tapped out– Politicians do not want to raise tax

• A Solution– Tap Private Sector Equity Markets– In the Form of Public Private Partnerships

PPP Financing, An Overview

• Entity Offers Facility for Concession

• Title/ Ownership NOT Transferred

• Performance Requirements– Maintenance– New Capacity– Customer Service– Toll Setting

• Not New to Transportation – Existing Around the World

What Does the Private Sector Bring

• Infusion of Capital

• Innovative Financing

• Innovative Ideas i.e. Marketing

• Ability/ Desire to Raise Tolls to Market Levels

• Best Practices

“We Can Build Our Way Out of Congestion…

Assuming We Price It Correctly.”

Contact Information

Chris BodyVice President, Business DevelopmentMark IV IVHS301-535-1563cbody@ivhs.com

Other Background Information-www.trb-pricing.org-www.ops.fhwa.dot.gov-www.valuepricing.org-www.viginiahotlanes.com