Transportation Policymakers Need to Use Congestion Pricing More

Earlier this week I was at a congestion pricing workshop hosted by the Federal Highway Administration, Federal Transit Administration, and consulting firm ICF in Providence, Rhode Island. Four of these workshops have already been held around the country and although this workshop was intended primarily to attract participants from the New England states, participants came from as far away as California, Florida and Iowa. The workshop included Planners and Engineers from Chicago, Dallas, Denver, Minneapolis, Los Angeles, San Francisco and Washington D.C.

In congestion pricing highway operators charge a variable price based on congestion to manage demand on an expressway or arterial. Although some projects generate revenue, this is not the primary purpose of congestion pricing.

There are at least five different types of priced facilities. Priced lane facilities charge for some but not all lanes on an expressway. California State Highway 91 was the first project with variable priced lanes. Priced expressways include charging for all the lanes on a facility. Washington State Highway 520 over Lake Washington is an example of a priced highway. In priced zones or cordon zones drivers are charged either a fixed or variable fee to enter a certain area of a city. Central London is an example of a cordon zone. A priced road network uses a network of variably priced highways or a network of priced lanes on an expressway network. The Dallas metro area is developing such a network. Finally, pricing involves other transportation-related resources including performance parking: prices are adjusted to ensure a certain number of curbside parking spaces; pay as you drive insurance: drivers are charged for the number of miles they drive instead of a flat fee; carsharing: people rent cars for a short period of time from an hour to a day; and dynamic ridesharing: people who travel to a certain location are matched in one vehicle using technology (informal carpooling).

Many U.S. metro areas have experienced the benefits of congestion pricing. The Los Angeles region reduced travel time by 10% and was able to decrease congestion sufficiently so that 132,000 additional people, 1.2% of the overall employment in the region, entered the workforce. While other factors were clearly in play, most of the growth can be traced to congestion relief. Another example is the Dallas region in which Planners and Engineers brought the public, business community, transportation agencies, elected officials and legislative leaders together to agree on a network of variable priced lanes. Dallas’ system has several innovative features including a rebate if speeds in the managed lane drop below 35 miles per hour. A third example is Chicago. Before the variable priced lanes, the average expressway speed during rushhour was less than 10 miles per hour. Commuters needed to multiply the time it would take them to reach downtown Chicago in off-hours by six to reach downtown Chicago during rushhour. San Francisco has also demonstrated how pricing reduces congestion and improves bus service. Additionally, since the proceeds from such a system are reinvested in transportation improvements, there have been no major equity issues in San Francisco.

Congestion pricing is not one size fits all; different metro areas need different solutions. While Atlanta could benefit from a priced road network, Austin may need only a priced lane on I-35. While a cordon zone may be appropriate for New York it would not work as well in New Orleans.

Whichever systems a state or metro area chooses, congestion pricing can decrease traffic congestion, improve transit services, offer a guaranteed consistent commute time and improve safety. Unfortunately, many leaders are unaware of congestion pricing, do not understand it or are reluctant to try the concept.

I hope that FHWA, FTA and ICF continue these congestion pricing workshops. While they require resources the workshops present a fact-based understanding of this concept. Additionally, political leaders, Planners and Engineers need to push for congestion pricing. With fiscal austerity the new reality, and a growing importance placed on improving and maintaining infrastructure, congestion pricing is one of the best tools to solve congestion.

Baruch Feigenbaum is Assistant Director of Transportation Policy at Reason Foundation a non-profit think tank advancing free minds and free markets. Feigenbaum has a diverse background researching and implementing transportation issues including revenue and finance, public-private partnerships, highways, transit, high-speed rail, ports, intelligent transportation systems, land use, and local policymaking.