Reason Foundation

Reason Foundation

Surface Transportation Innovations #80

Rethinking carpool lanes and bus transit, congestion and CO2, and DOT's strategic plan

Robert Poole
June 30, 2010

In this issue:

A New Emphasis on Bus Transit

The urban transit community was buzzing last month after a remarkable speech by Federal Transit Administrator Peter Rogoff on May 18th at the National Summit on the Future of Transit, in Boston. Pointing not only to the fiscal crunch facing all levels of government but also to the dire condition of transit agencies, Rogoff said it was time for everyone in transportation to face facts. The seven largest rail transit operators have a deferred maintenance backlog of $50 billion, with another $28 billion racked up by the smaller systems. And 29% of all transit assets are in poor or marginal condition. Yet at this very time at least 80 urban areas are seeking federal funds for new rail transit. "At times like these," he told the audience, "it's more important than ever to have the courage to ask a hard question: if you can't afford to operate the system you have, why does it make sense for us to partner in your expansion? If you can't afford your current footprint, does expanding that underfunded footprint really expand the President's goals  . . . in any sustainable way?"

So Rogoff reminded his listeners about the virtues of buses, which provide the majority of all transit trips (but account for only one-quarter of the deferred maintenance). "A little honesty about the differences between bus and rail can have some profound effects," he said. Bus Rapid Transit (BRT) would be wiser than rail "for a lot more communities than are currently considering it. Some communities might be tempted to pay the extra cost of shiny new rails now. But they need to be mindful of the costs they are teeing up for future generations."

"One [simple truth] is this-paint is cheap, rail systems are extremely expensive. Yes, transit riders often want to go by rail. But it turns out you can entice even diehard rail riders onto a bus, if you call it a 'special' bus and just paint it a different color than the rest of the fleet." In addition, once you have the special buses, consider busways: "Take that paint can and paint a designated bus lane on the street system. Throw in signal preemption, and you can move a lot of people at very little cost compared to rail."

This is certainly a breath of fresh air. Rogoff seems to be referring to the highly successful and amazingly affordable Metro Rapid buses operated on major arterials by LA Metro, with traffic signal preference but not exclusive lanes. Even without the latter, they have significantly increased transit ridership by offering faster (limited-stop) trips in major corridors. But with more than a few cans of paint, we can do even better.

At FHWA's National Road Pricing Conference in Houston earlier this month I heard an impressive presentation on a concept called the "Bus Toll Lane," subtitled "a new transit and tolling partnership using pricing to create a win-win congestion strategy." The presenter was Marty Stone, director of planning for the Tampa Hillsborough Expressway Authority. The concept begins with the insight (as described in a 2005 Reason policy study that I coauthored) that priced managed lanes can be the virtual equivalent of an exclusive busway. There is only one corridor in America where bus demand is enough to fully utilize the capacity of an expressway lane during peak hours (the Lincoln Tunnel Busway in New Jersey). Everywhere else an exclusive busway-whether arterial or on a freeway-uses only a few percent of the hourly vehicle throughput capacity. But if you allow, say, carpools to fill in the empty spaces, you risk the lane becoming congested and losing its "virtual exclusivity" for BRT. But if the non-bus capacity is value-priced, it's a whole different story, since you can limit ("manage") non-bus usage to guarantee that buses can operate fast and reliably, just as if they had the lane to themselves.

More than a dozen large metro areas are building priced Managed Lanes projects, and quite a few have progressed to plans for region-wide networks of such lanes. But as real numbers are crunched for these proposed networks, it's beginning to look problematical that value-priced toll revenues can finance not merely the "best" (most congested) corridors but also the other links and flyover connectors needed to create the kind of seamless network that can support region-wide BRT service.

This is where the Bus Toll Lane concept comes in. Stone is proposing these Managed Lanes as truly joint ventures between transit agencies and toll agencies (or state DOTs or in principle private toll companies). That means the lanes would give first priority to the needs of the BRT service: guaranteed transit capacity and schedule reliability. And all the remaining capacity would be sold to toll-paying customers, so that all of it is manageable via pricing. Given that premise, Stone is proposing that FTA be a capital funding partner for the construction of the lanes, and essentially a part-owner of the resulting network. The transit agency would operate and maintain all the rolling stock, while the toll agency or equivalent would operate the tolling system and maintain the lanes.

Stone's presentation concluded with a call to action. The transportation community should encourage FHWA and FTA to embrace this partnership concept, at the funding level, while state and local transportation providers should begin defining specific models. I hope Administrator Rogoff will consider this idea, as FTA and its fellow agencies collaborate on proposals for the surface transportation reauthorization.

CO2 and Congestion

We all know that stop-and-go driving that's typical of congestion increases fuel consumption, and also that CO2 emissions are proportional to fuel use. So it would appear that congestion pricing could be an important tool for reducing CO2 emissions from highway travel. In the US DOT's April 2010 Report to Congress on "Transportation's Role in Reducing U.S. Greenhouse Gas Emissions," this connection is given short shrift. On pp. 5-6 of the executive summary, the report says "Strategies such as traffic management and bottleneck relief . . . have the potential to modestly reduce GHG [greenhouse gas] emissions by decreasing fuel consumption associated with congestion and stop-and-go traffic." But because of uncertainty about how much "induced demand" would result from such improvements and thereby offset the GHG reductions, the report includes no quantification of the impact of congestion reduction. It goes on to focus on the usual agenda of reducing vehicle miles of travel (VMT) via smart growth and transit. (

Fortunately, two researchers at the University of California at Riverside have taken up the challenge. Matthew Barth and Kanok Boriboonsomsin of UCR's Center for Environmental Research and Technology have published several recent papers on this subject, one in 2008 in Transportation Research Record No. 2058 and a less technical article in the Fall 2009 issue of Access, the magazine of the UC Transportation Center.

Using a large dataset of vehicle trips in Southern California, plus data on CO2 emissions for different speeds and traffic conditions, the researchers developed a CO2 emissions histogram for every trip in the database. They used these to create a plot of emissions vs. speed, which is bowl-shaped. Below 25 mph, emissions range from 400 to 1,000 grams/mile, but between about 30 mph and 55 mph, emissions are essentially flat at around 330 g/mi. Above 65 mph, they rise slowly, and above 75 mph begin rising more rapidly. But even by 80 mph CO2 emissions reach only about 400 g/mi-nothing like the much higher levels from stop-and-go driving.

Further analysis led the researchers to propose a set of policies for reducing on-road CO2 emissions. Congestion mitigation (via congestion pricing, ramp metering, and incident-management) should be used to reduce stop-and-go driving-the low end of the bowl-shaped curve. Speed management is aimed at the other end of the curve, via better enforcement of speed limits and Intelligent Speed Adaptation, a form of variable speed limit based on conditions. And traffic smoothing techniques (including congestion pricing and variable speed limits) are recommended for the middle ranges, to keep speeds steady in the bottom of the bowl, where emissions are the lowest.

How much would all this accomplish? The authors estimate that each strategy alone could reduce CO2 emissions by 7 to 12%, and all three combined could reduce those emissions by approximately 30%.(

Rethinking HOV Lanes

Back in 2005, Ted Balaker and I introduced the idea of Virtual Exclusive Busways-priced managed lanes with a priority for bus rapid transit operations. The first several chapters of that Reason policy study traced the history of HOV lanes, showing how they evolved from early exclusive busways (e.g., on the Shirley Highway in northern Virginia and Houston's reversible, single-lane "transitways"). Because of the highly visible empty lane syndrome, political pressures led to the busways being opened up, first to vanpools, later to 3- or 4-person carpools, and eventually (in most metro areas) "HOV lane" became nearly synonymous with HOV-2. We argued that this was a failing model, in part because most actual HOV-2 lanes were either overcrowded or underutilized. And we presented early evidence that a large fraction of those two-person carpools were family members who would likely be traveling together anyway-hence, their use of the carpool lane did not reduce the number of cars on the road at rush hour. (

Five years later, the predominance of the HOV-2 model is waning. A study by Joseph Plotz, Karthik Konduri, and Ram Pendyala of the University of Arizona analyzed data from the 2001 National Household Travel Survey, concluding that the "vast majority of HOV trips are trips undertaken with family for discretionary activity purposes," leading them to question the wisdom of providing HOV lanes. (paper available on the TRB 2010 Annual Meeting CD-ROM). A study by mark Burris and Kevin Lipnicky compared the (recently replaced) reversible HOV lane on Houston's Katy freeway with a hypothetical general purpose lane in each direction, making use of the same total right of way, and concluded that the latter would have provided greater transportation benefits. (Public Works Management & Policy, Vol. 14, No. 2, 2009)

The first wave of conversions of HOV lanes to HOT lanes took pains to preserve the HOV-2/free policy, envisioning the revised lanes as still basically carpool lanes that simply sold any excess capacity to paying customers. Researcher David Ungemah has deemed this the HOT 1.0 model. By contrast, the emerging HOT 2.0 model envisions a HOT lane as a business selling faster and more reliable trip to willing customers, while possibly providing free or discounted access to certain types of higher-occupancy vehicles, usually at least three or more (which cuts out most fam-pools). Where a HOT lane represents new construction, a HOT-3+ policy is generally required if the capital costs are to be recovered from toll revenues. But even one of the most recent HOV to HOT conversions-on I-95 in Miami-adopted essentially the Managed Lanes 2.0 model by upping the minimum occupancy for free passage to three or more and also offering that only to registered (employer-based) carpools. That again rules out most fampools and goes back to the original concept of employer-based ride-sharing.

Last month the Golden Gate Bridge announced a new policy of charging carpools half-price instead of giving them free passage; carpools will have to be equipped with a FasTrak transponder in order to get the discount. The decision is consistent with the earlier 2010 decision of the Bay Area Toll Authority to do likewise on all of its bridges (including the San Francisco-Oakland Bay Bridge). Golden Gate will also end free trips for motorcycles, hybrids, and buses, which will also be charged half-price during peak periods. California's statewide policy of giving solo drivers in hybrids access to HOV lanes ends in December, though various groups are lobbying to continue it.

Finally, a growing number of feasibility studies for new HOT lanes or networks are quantifying the huge difference in revenue between a policy that gives free passage to fam-pools versus one that gives discounts or zero tolls to HOV-3 or higher. As metro areas make decisions to implement Managed Lane networks, the revenue factor will likely be the driving force in changing occupancy policy.

Private Funding of Transit Stations

We hear a lot of talk about the potential of "value capture" for funding transportation infrastructure. It's certainly true that commercial real estate close to Metro stations in Washington, DC, for example, had its location value increased because more people can get there via transit (in what is otherwise a dense, traffic-clogged downtown much of the day, with scarce and expensive parking). But it does not follow from such examples that any rail transit line produces significant land-value increases that could potentially be tapped (e.g., via a benefit assessment district) to help pay for such stations. Outside downtown San Francisco, for example, there is little evidence of densified, higher-value development around most BART stations. Portland touts high-density development adjacent to its light rail stations, but fails to disclose how heavily subsidized much of that development is.

In a new paper attempting to shed some light on the economic development impacts of high-speed rail, David Levinson of the University of Minnesota provides capsule summaries of 21 studies of land-value impacts of urban rail transit. Most do show some gains in land value near stations, but those that also looked at negative impacts on land-value due to noise and vibration along the lines between station (only four) found negative impacts there, despite finding some positive impact around stations. ( Levinson and several U. of Minnesota colleagues produced a report, requested by the state legislature, describing eight different value-capture techniques and assessed each against the criteria of economic efficiency, equity, sustainability (defined here as reliability of revenue), and feasibility (political and administrative). But this paper provides no comparative data on the effectiveness of the eight techniques as used in practice.(

One of the relatively recent U.S. transit stations that was partially privately funded is the New York Ave. station of the Washington Metro. This "missing" station on the Red Line was built in 2004, with $25 million in cash and $10 million in donated land from a nonprofit, private development corporation, $44 million from the DC government, and $31 million from the feds. According to the case study report on the website of the National Council for Public-Private Partnerships, the 35-block area surrounding the station has witnessed $1 billion in subsequent development-suggesting that the in this case the land-value funding model was far too cautious. (

By far the most robust example of private-sector station development is the 100% private development of four out of five of Madrid's Intermodal Exchange Stations (IESs). As detailed in a 2009 paper in Transportation Research Record No. 2115, these stations are located where radial freeways and tollways intersect the circumferential subway around the central business district. They facilitate connections among four modes: privately owned inter-regional buses from the suburbs, the subway, commuter rail, and city buses. Each IES is an underground facility, some with parking, as well as many shops and eating places. For the last 1 to 2 km. of the radial highway, regional buses can bypass growing congestion by using a tunnel beneath the highway that terminates at the IES (an integral part of each project).

The government built the first IES in 1995, but did not have the funds to build the planned others. So it made use of Spain's infrastructure concessions law to seek private-sector proposals. The winning teams typically consist of bus companies, construction companies, and a facility management company. Each IES was financed based on its projected revenue stream, consisting of access fees paid by the bus companies (which get time savings worth more than what they pay), commercial rents, and parking rents.

The TRR article provides no data on Madrid's auto versus transit commuter mode share, so it's difficult to guess how successful a model like this might be in very large U.S. urban areas. But the fact that the IESs are private, for-profit ventures with no government subsidy suggests this model might be worth further study for U.S. application.

More Feedback on US DOT Draft Strategic Plan

I was not the only one who was hugely disappointed in the draft Strategic Plan for surface transportation released in April by the U.S. DOT. Even the generally sympathetic CEO of the Eno Transportation Foundation, Steve Van Beek, expressed surprise at "the exclusion of goals focused on either mobility, capacity or congestion reduction," noting that these have been part of the last four DOT strategic plans. He also noted, as I did last issue, that the plan "betrays model biases of its own," in putting forth assertions about the benefits of shifting freight from road to rail and from rail to water that are "without foundation and are unnecessarily provocative. Only detailed analysis should determine for any one project or movement what mode is preferable, either from a narrow carbon footprint or a more general sustainability standpoint." (EnoBrief, May 2020, pp. 1-2,

Making similar points in a less cautious way was Bill Graves, president of the American Trucking Associations. He noted that "The Administration's modal choices ignore market forces and reflect personal preference and a strong bias against highway transportation." He also pointed out that the choice of mode for freight shipment is based on market forces, and that despite recent growth of truck-rail intermodal, thus far this combination works well enough to be chosen for less than 2 percent of the freight market. He also noted that while the draft plan is very ambitious, "many of [its] aspirations have little to do with transportation and instead focus on social engineering." He also flatly states that "The trucking industry cannot support a plan that diverts more revenue from the HTF [Highway Trust Fund] to non-highway, let alone non-transportation purposes."

But for my money, the most comprehensive critique was that from AASHTO, representing the state DOTs. In particular, the AASHTO brief brings real numbers to bear. Assuming that federal policy goes all-out to shift passenger travel from cars to transit in urban areas, and inter-city passenger travel from highways to higher-speed rail, AASHTO posits a quadrupling of transit ridership by 2050 and a 12-fold increase in passenger miles moved by inter-city rail. And using DOT's own assumption that growing population and rising affluence increase total passenger travel by 2.5 times by 2050, what would be the resulting mode shares? Answers:

            Transit                                     2.8% of passenger miles

            Intercity rail                             1.0% of passenger miles

            Car, truck, motorcycle             93.0% of passenger miles

And yet the strategic plan "makes no mention of increasing highway capacity as part of the solution. This is directly at odds with the report issued earlier this spring by the very same DOT, the 2008 Conditions & Performance Report, which documented a need for $100-137 billion per year in highway capital investment over the next 20 years (counting only projects with a benefit/cost ratio of 1.5 or higher).

AASHTO's critique also takes issue with the plan's attempt to put FHWA in the driver's seat in choosing highway projects, reversing the program's historic nature as a "state-administered, federally-assisted program." Yet the draft plan refers to state project selection as a "risk factor."

As Bill Graves wrote, in the conclusion of his comments, "If this draft is a reflection of [the Administration's approach to] the coming reauthorization bill, then we implore Congress to develop alternatives."

Upcoming Conferences

Note: I don't have space to list all the transportation conferences going on; below are those that I or a Reason colleague are participating in.

Transportation Research Board Joint Summer Meeting, July 11-13, Minneapolis, MN, Marriott City Center Hotel. Details at: (Adrian Moore and Robert Poole)

22nd Annual Public-Private Partnerships in Transportation Conference, July 22-23, Washington, DC, Renaissance Washington Hotel. Details at: (Robert Poole speaking)

8th Annual Preserving the American Dream Conference, Sept. 23-25, Orlando, FL, Doubletree Resort. Details at (Sam Staley and Shirley Ybarra speaking)

News Notes

Overseas Road Pricing Scan

The Transportation Research Board, AASHTO, and FHWA jointly sponsored an international scan tour of road pricing projects in the Czech Republic, Germany, London, the Netherlands, Stockholm, and Singapore in December 2009. Last month an excellent summary report was released: "International Scan: Reducing Congestion & Funding Transportation Using Road Pricing" It's online at

Amtrak Report on European Rail Subsidies

If you've been confused by conflicting reports about whether European passenger rail is or is not subsidized, this little-known report by Amtrak's Office of Inspector General will clear things up. It finds that the passenger rail systems of six major EU countries have on-balance-sheet subsidies totaling $26 billion per year, plus off-balance-sheet subsidies of another $15.8 billion per year. Claims of operating profits are bogus, because they mis-classify as "revenue" significant subsidy amounts. One of its other findings is that, "when the relative network sizes are taken into account, the annual subsidies for European passenger train operations are much higher than those for comparable Amtrak services." (

Overview of U.S. Energy Policy

My old friend Steve Hayward, at American Enterprise Institute, wrote an excellent critique of current U.S. energy policy for The Weekly Standard several months ago. "The Energy Policy Morass" appeared in the April 26 issue. (

CO2-Absorbing Concrete

The production of 2.8 billion metric tons of cement in 2009 (worldwide) emitted 5% of all global CO2 emissions. A British start-up company, Novacem, is developing a cement that it claims will absorb more CO2 than is released during its production. The key innovation is to substitute magnesium compounds for the usual limestone. As the cement hardens, the magnesium reacts with atmospheric CO2 to make carbonates that strengthen the cement while trapping the gas. The company plans to construct a pilot plant and is fine-tuning its formulas to equal the mechanical properties of Portland cement. (David Bradley, "Green Concrete," Technology Review, May/June 2010)

New FHWA Report on Intersection Designs

Conventional arterial intersections can be bottlenecks and cause safety problems, especially if there is strong left-turn demand. In recent years, a number of innovative intersection designs have been proposed, and some are now being tried out. FHWA's Office of Safety Research and Development has released a new report, "Alternative Intersections/Interchanges: Informational Report" (FHWA-HRT-09-060) providing specifics on four intersection designs and two interchanges. Go to:

Reducing Big-Rig Air Drag

Aerodynamic drag requires horsepower to overcome, which means greater fuel consumption. That's a big problem for over-the-road 18-wheelers, and trucking companies have been working for several decades to reduce such drag. Engineering News-Record recently spotlighted a new product that its developer claims can increase big-rig fuel economy by 1% at modest cost. The device is an inexpensive fabric wheel cover, consisting of a metal frame that snaps into the concave rear wheels of tractors and trailers, onto which is mounted a circular fabric cover. The "Deflector" retails for $50. The 1% fuel savings claim comes from a test program on 1,500 trucks in the Schneider National fleet. ("Cloth Hubcaps Help Truckers Reduce Drag, Burn Less Fuel," Mike Larson, Engineering News-Record, May 10, 2010.)

Another Texas PPP Toll Road Gets Investment-Grade Rating

Many observers were surprised last December when the North Tarrant Express PPP toll project in the Dallas/Ft. Worth region got financed, despite the still-recovering credit markets. But a similar financing for a similarly large and ambitious toll project-the I-635/LBJ Managed Lanes-appears close to reaching financial close. Both Moody's and Fitch have rated the private activity bonds as investment-grade. They will provide the senior debt, with subordinate debt coming from a TIFIA loan plus equity of at least $570 million from the Cintra/Meridiam team. The project's overall price tag is $2.6 billion.

Quotable Quotes

"The significant benefits of mobility must also be granted to the urban dweller. There was a time, not so long ago, when factory workers crowded together in slums close to the places where they worked, or along the trolley lines. With the use of the automobile, the worker gained a wider choice of areas in which to live - he could live anywhere within driving distance of his place of employment. We are working now to improve the mobility of the worker through the construction of freeways and expressways to carry him from one side of a large city to another side in a matter of minutes. This mobility has many social, cultural, and economic advantages. Here is one in particular: during times of economic readjustment, when many a workingman is forced to join the ranks of the unemployed, increased flexibility of travel means that he can range farther in search of a job, and that he can take a new job without necessarily giving up his old home. Good roads increase the adjustability of the labor force, giving the worker a wider choice of jobs and giving the industrialist the benefit of a larger labor pool from which to draw."

--Sen. Jennings Randolph (D, WV), testimony before House Public Works Committee, May 5, 1959 (quoted in Transportation Weekly, May 19, 2010)

"But [DOT's] definition [of livability] is too narrow to suit most Americans, whose notion of 'livability' may include living in suburban communities and enjoying such obvious amenities as a safe neighborhood, access to good schools, the privacy of one's own back yard, and the freedom, comfort, convenience, and flexibility of personal transportation. If 'livability' becomes a euphemism for a federal policy favoring high density, transit-dependent living, they we are moving closer to 'newspeak' when words mean whatever Big Brother intends them to mean."

--Ken Orski, Innovation NewsBriefs, May 18, 2010

"There is no 'ban' by Congress on tolling existing toll-free general purpose lanes on Interstate highways. Since 1991, Congress has authorized a pilot program that allows such tolling. The program, called the Value Pricing Pilot Program, currently provides for such tolling authority to 14 states and New York City. The Program does not have any difficult restrictions on toll rates or use of toll revenues. The 14 states and New York City are eligible to set whatever toll rates they deem are necessary. Excess revenues not needed for operation and maintenance, interest, and return on investment of a private partner may be used for any transportation purpose under Title 23. In other words, capital costs for highway and transit facilities anywhere in the state may be paid for using excess toll revenue. Toll revenues may also be used for operating costs for bus services operating on priced facilities, if they are an integral part of the value pricing project. The only requirement is that toll rates vary to manage demand and reduce congestion on the Interstate highway. . . . In spite of this relatively open tolling authority under the Value Pricing Pilot Program, there have been no takers for full pricing of all lanes of Interstate highways."

--Anonymous, on IBTTA Tolling Points blog, April 14, 2010 (

"The greatest economic crisis since the Depression shows no signs of ending soon. A major long-term program of public investment is needed more than ever. But the public investments must pass the reality test. And the harsh reality is this: There isn't going to be a significant high-speed rail system in the U.S. in the near- or medium-term future. There isn't going to be a continental electrical grid permitting solar panels on condo buildings in Berkeley, Calif. to power heirloom-poultry farms in Maine. Most Americans are not going to sell their cars and move back from the suburbs to the cities in order to live in tiny apartments or condos and ride the rails to work. These are romantic daydreams that Democrats could afford to indulge only as long as they were out of office and not responsible for results. During the Bush years, liberals took pride in describing themselves as 'reality-based.' When it comes to transportation and energy, the American center-left needs to get reality-based in a hurry."

--Michael Line, New America Foundation, "Goodbye, Bullet Trains and Windmills," Salon, June 8, 2010 (

"Transit's slower average travel speeds result in approximately 3 billion hours annually of additional travel time. If valued at the TTI time value of $15.47 per hour, this equates to approximately $44 billion annually in lost productivity . . . .  Thus, the few percent of persons who use transit . . . incur 70% as much lost time relative to driving as is incurred by the total of auto travelers due to congestion, $44 billion for transit users versus $64 billion for driving in congestion. While one often hears about the 'cost of congestion,' there is virtually no one talking about the 'cost of using slower modes of travel.' We hear a lot about the value of having a choice of modes but increasingly little about the value of having a choice of an uncongested or less-congested travel option. Is it fair to talk about the cost of using transit as $44 billion in lost productivity? And what is the time cost of walking and biking versus alternative modes?"

--Steven Polzin, "The Cost of Slow Travel," Planetizen, June 4, 2010 (

"Time has just about run out. I'm pretty much declaring that any gas tax proposal is dead. [Next year] you're going to see a much more conservative Democrat-Republican House and Senate, so I think the last thing they're going to do is finance a plan that relies on increasing the gas tax. I've held off making these pronouncements until now, but we have to be realists. I want people to change gears. . . . I'm not fixed at anything. I've encouraged all of them to look for a Plan B. They all look shocked and helpless because they've put so much effort into raising the gas tax."

--Rep John Mica (R, FL), "It's Now or . . . 2011," The Journal of Commerce, June 7, 2010, p. 18

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

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