Steve HemingerExecutive DirectorMetropolitan Transportation Commission

Transportation Research BoardExecutive Committee

June 17, 2005

TOLL:The Four Letter Word of Transportation Finance

TOLL:The Four Letter Word of Transportation Finance

Gas Tax is a Goner

No federal rate increase since 1993

Less than 1/2 of states have raised their state gas tax since 1993

6 states with tax hikes were due to automatic indexing

Fuel Efficiency Stalls Out

Source: U.S. Environmental Protection Agency, 2004

Explosive Growth of SUVs

Source: U.S. Environmental Protection Agency, 2004

Light Duty Vehicle Sales Trends by Vehicle Type

Far Higher Gasoline Prices Abroad

Source: International Energy Agency, 2005

Gasoline Prices for Selected Countries

Retail Gasoline Prices Dwarf Tax Rate

Source: Energy Information Administration, FHWA, 2005

“Read my Lips: No New Taxes”

— George H. W. Bush, 1988

“Read my Lips: No New Taxes”

— George H. W. Bush, 1988

“Pay As You Go” System

Stopped paying — no political will for

tax hikes

Stopping going — mounting trafficcongestion and repair backlogs

False Trail: The General Fund

Annual U.S. Transportation Spending

Source: The Brookings Institution, 2003

Growing Reliance on Non-User Fees

Source: Surface Transportation Policy Project, 2002

Type of Revenue

1995 1999

ChangePercent Change

State Borrowing

($ in millions)

92$4,316 $ 8,298 $3,982

Other Local Taxes Includes Sales Taxes $ 4,487 $ 7,079 $ 2,592 58

Other State Taxes $ 6,565 $ 8,560 $ 1,995 30

Local General Funds $ 12,326 $ 15,857 $ 3,531 29

Local Property Taxes $ 5,220 $ 6,384 $ 1,164 22

State User Fees $36,200 $42,730 $6,530 18

Original Toll Concept — River Chains

U.S. History of Toll Roads

1656 First toll bridge — Newbury, Massachusetts

1785 First turnpike — Little River Turnpike, Virginia

1822President Monroe vetoes bill authorizing collection of tolls from road users

1850Hundreds of private turnpike companies operate thousands of miles of roads in most states

Continued next slide

1920 – 40Major urban toll facilities completed, such as New York’s Holland Tunnel and San Francisco’s Golden Gate Bridge

1940Pennsylvania Turnpike opens, followed by state toll road authorities in Maine, New Jersey, Ohio, Connecticut and Florida

1956Congress approves Federal-Aid Highway Act, providing for a fuel tax-based financing mechanism to construct the interstate system

U.S. History of Toll Roads (cont’d)

Continued next slide

1980 – 1990

States create facility-based toll authorities to supplement interstate highway capacity, such as TCA roads in Orange County, California and E-470 in Denver, Colorado

1991 Congress passes ISTEA legislation which authorizes limited state experimentation with toll-based congestion pricing

1995 –present

Metropolitan regions experiment with High-Occupancy Toll (HOT) Lanes in California, Texas, Minnesota, and Colorado.

U.S. History of Toll Roads (cont’d)

Source: FHWA

(est.)

Toll collection lanes with electronic toll collection capability

Electronic Toll Collection:The Great Enabler

Congestion Tolls

Project Type Status

Singapore Cordon Operational 1975

Norway Cordon Operational 1986

London Cordon Operational 2003

Orange County, SR 91 HOT Operational 1995

San Diego I-15 HOT Operational 1996

Houston Katy Freeway HOT Operational 1998

Minneapolis I-394 HOT Operational 2005

Denver I-25 HOT Planned 2005

Seattle Route 167 HOT Planned 2007

Alameda County I-680 HOT Planned 2009

Source: Institute of Transportation Studies, UCLA

Weight-Distance Truck Tolls

Project Status

Swiss “HVF” Truck Toll Operational 2001

Austrian “GO” Truck Toll Operational 2004

German “Toll Collect” Truck Toll Operational 2005

U.K. Truck Toll Planned 2007

Bristol Truck Toll/Cordon Toll Trial Project

Australian “Austroads” Monitoring Planning Phase

Source: Institute of Transportation Studies, UCLA

Press Overreaction

“Tolls are a polite form of

highway robbery.”

— Bill Lockyer,California Attorney

General

“Tolls are a polite form of

highway robbery.”

— Bill Lockyer,California Attorney

General

Legislative Resistance

Free Lunch Mentality

www.mtc.ca.gov