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The Planning Report

Congestion Pricing for Los Angeles

An Open Letter to L.A. Mayor Antonio Villaraigosa

Robert Poole
July 1, 2007

While congestion-pricing schemes have been successful in London and are gaining political momentum in American cities such as New York and San Francisco, Southern California's congested freeways will require an approach to pricing that is designed to ease the flow of traffic outside of urban commercial centers. MIR is pleased to present the following letter from Robert W. Poole Jr., director of transportation studies at the Reason Foundation, which presents some of Southern California's pricing options to L.A. Mayor Antonio Villaraigosa.

Dear Mayor Antonio Villaraigosa,

Thanks for your leadership in putting congestion pricing on the transportation agenda for Los Angeles. As we move forward to consider how best to use this concept, it's important to draw on lessons learned not only from overseas cases, like London, Singapore, and Stockholm, but also from the congestion-priced HOT (high occupancy toll) lanes on SR 91 in Orange County and I-15 in San Diego. One overwhelming finding from all of these cases is that charging people to drive at rush hour really does reduce congestion.

But in crafting a plan for Los Angeles, that's not the only key lesson. Another is that congestion pricing needs to be tailored to the specifics of each metro area. The three overseas cities' congestion problems were primarily in their central business districts, so it made sense to focus pricing there. But L.A.'s main congestion problem is on its freeway system, so that should be the principal focus of our congestion pricing plan.

Another key difference is the role of mass transit. You have been a forceful proponent of increased transit investment, and indeed, the majority of transportation spending in the current SCAG long-range plan would go for transit. Yet that same plan projects that, despite increasing transit's rush-hour market share 50% by 2030 (from below 5% to nearly 7.5%), transit would still be a small fraction of all such trips. That means, like it or not, that most rush-hour trips in 2030 will still be made by car. Once again, that underscores the need to focus on relieving congestion on the freeway system.

Another crucial factor will be overcoming political opposition to congestion pricing. Charging people to use the general-purpose lanes that are currently "free" has never been done in America. Such a plan would be fought bitterly by auto clubs, trucking groups, and taxpayer groups. For this reason, it would be far more realistic to introduce congestion pricing by charging only for guaranteed uncongested travel on specialized lanes.

A HOT Lanes Network

Putting all these lessons together, the single most important step Los Angeles could take on congestion pricing is to convert the region's large and growing set of HOV lanes into a seamless network of HOT lanes (similar to those on SR 91 and I-15). This could be done by installing electronic tolling equipment and signage overhead on the existing lanes, issuing revenue bonds based on the projected toll revenue, and using those funds to add key missing links—e.g., HOT lanes on US 101 and I-10, and flyover HOT-to-HOT connectors at key interchanges.

If such a network existed, what would be the benefits? First, every driver in Los Angeles would then have "congestion insurance"—i.e., the peace of mind of knowing that whenever she absolutely had to be somewhere on time, she would have an uncongested alternative available. Most people would not pay to use this alternative every day, but most would welcome the option for those times when they really needed it. Second, the large majority of the costs of the additional lanes and flyovers would be paid for out of toll revenues, with the funding available up-front so that these projects could be built within the next decade, not whenever Caltrans could scrape together the funds.

But the third benefit is perhaps the most important. A HOT Network offers by far the most bang for the buck in expanding mass transit's market share in Los Angeles. Express bus service is vastly less costly than rail transit, since it can use existing roadway capacity paid for by motorists. Even on congested surface streets, the new Metro Rapid bus service has been a tremendous success. And where express buses operate on relatively uncongested HOV lanes, such as the El Monte Busway, they carry huge numbers of people.

But L.A.'s HOV lanes are getting crowded, and over time they will lose their time-saving advantage. Even upping the HOV requirement to three-plus passengers is not a sustainable solution, since continued growth in population and driving will fill them up again. Only congestion pricing can guarantee uncongested conditions in priced lanes indefinitely. A HOT Network is a sustainable transportation solution, in a way that HOV lanes never can be.

Some may suggest, as long as we're thinking outside the box, that we convert the HOV lanes into exclusive busways instead. But even in high-demand corridors where as many as 100 buses per hour might be fillable during peak periods, that would still leave a huge portion of lane capacity unused. With congestion pricing, we can easily achieve 1,700 vehicles per lane per hour, flowing smoothly at 55-60 mph. Congestion pricing lets us fill in the spaces between buses with enough paying vehicles to make full use of the expensive infrastructure—but never enough to introduce congested conditions that would reduce the speed or schedule-reliability of the buses. A HOT Network is the virtual equivalent of an exclusive busway network but with this crucial difference: the infrastructure costs would be paid for by highway funds (tolls plus gas taxes), not scarce transit capital funds.

Other Priced Links

There are other ways that congestion pricing could be used productively. Recent reports from SCAG and Caltrans point out the overwhelming need to add capacity to the highway system, to cope with the enormous projected growth in people and driving (despite transit investments and the transit stimulation made possible by the HOT Network). Congestion pricing of costly new additions such as tunnels can produce far more revenue than conventional flat-rate tolling. Thus, congestion pricing revenues should fund a large share of the capital costs of these very ambitious projects. And pricing will keep them from becoming overwhelmed by traffic congestion, making them sustainable highway investments.

The most promising near-term candidates for tunnel megaprojects are to close the gap in I-710 at South Pasadena, to provide a new route between fast-growing Riverside County and Orange County to relieve SR 91, and to open up access to Palmdale Airport and North County via a tunneled extension of the Glendale Freeway.

Another other urgent priority is a congestion-priced toll truckway system, linking the ports to the Inland Empire. Due to land-use constraints on widening the relevant freeways, much of this $12-15 billion project would have to be built as elevated construction. But time savings and payload increases would make it worth truckers' while to pay tolls to use such truckways.

If we think outside the box a bit more, there are clearly other locations where congestion-priced tunnels would greatly improve the connectivity of the freeway system. One would be to extend the Glendale Freeway southward, initially to U.S. 101 and potentially to I-10. Another would be to revive the original route of the Reseda Freeway, connecting the 101 to the western terminus of the Santa Monica Freeway, largely as a tunnel. At about 12 miles, this would be shorter than the proposed Glendale-Palmdale and Riverside-Orange County tunnels.

In short, there is a very large role for congestion pricing in addressing LA's enormous transportation investment needs, while reducing projected levels of congestion. It will take real leadership to embark on this course, and I commend you again for taking the important first step.

Best wishes,

Robert W. Poole, Jr.
Director of Transportation Studies
Reason Foundation


Robert Poole is Searle Freedom Trust Transportation Fellow and Director of Transportation Policy


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