Bacon's Rebellion

Democracy Thrives in Sunlight

HOT Lanes at 45 MPH Not So Hot

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by

James A. Bacon
in

If High Occupancy Toll lanes are placed on Interstates 395 and 95 in Northern Virginia, their private-sector operator would be required to assure average speeds of only 45 mph, reports Lillian Kafka with the Manassas Journal-Messenger.

The Virginia Senate Transportation Committee decided not to up that average speed to 55 on Thursday.

“We believe it is going to be too difficult to maintain that 55 mph average speed,” said Keith Martin, policy director at the Virginia Department of Transportation. “It may discourage companies from partnering with us.”

Or, he added, it could raise the variable rate tolls even higher than they could already increase as the HOT lanes become more congested.

Interesting question: Which would the public prefer, faster lanes and higher tolls, or slower lanes and lower tolls?

Here’s my question: Why is the Virginia Senate Transportation Committee making this business decision? Why isn’t that left to Fluor/Transurban?

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  1. E M Risse Avatar
    E M Risse

    Why 45? 25 MPH is much safer.

    What is the hurry?

    We need better, happier, safer, not faster, more expensive.

    EMR

  2. Anonymous Avatar
    Anonymous

    25 mph moves more cars per hour, too.

    But those that pay, are paying for a speedy trip, if they don’t get it they will be unhappy.

    This goes right to the argumnent Larry and I had earlier. Do you manage the road for maximum throughput (and presumably, but not demonstrably, mximum benefit to all) or do you manage it for maximum profit for the operator?

    I think I calculated that if time is valued at $20 per hour then the most profitable condition is at 45 mph, even though more cars pass ar 25 mph, they won’t be willing to pay as high a premium for the trip.

    Are we bulding this road for transportation, or for profit?

    RH

  3. Larry Gross Avatar
    Larry Gross

    I think we’ve had several folks over time comment here on BR that what they really value is a time-predictable commute ESPECIALLY when they have a meeting or appointment that they cannot afford to miss or be late for.

    So what the toll operator is paying attention to is dependability… the same thing that McDonalds pays attention to .. and the same reason why asking a question like: Is McDonalds trying to sell the most burgers (throughput) that it can or get the most profit.

    That perspective assumes that the customer will accept any kind of quality in exchange for a price and it’s simply not true… McDonalds knows this and so does the toll operator for the HOT Lanes.

    So.. what they want to do is provide a high level of assurance to customers that ..for their money.. they WILL get a trip that at the MINIMUM will give them a dependable 45 miles in an hour and they can count on that to estimate travel time.. for important meetings.. and such.

    offering 55 and failing to deliver – even 10% of the time could have serious consequences…for unhappy customers…

    So, I don’t think it is about speed, or throughput or even (short term) profits – it’s about providing a quality service that people can count on.. and will become satisfied customers who will continue to use the service in the future. You want those folks coming back every day AND you want them to know that even if the price is up higher.. that they still will get what they expect.

    It’s sort like paying 3 bucks for gasoline. you STILL EXPECT good quality gasoline… and the way to really erode trust.. is for the customer to feel that they no longer can trust the quality of the service.

    Part of what makes this tricky is the additional complication of making that same quality level of service available for “free” for shared-vehicles including the Slugs (casual carpools) without affecting the people who pay – and vice versa.

    HOT Lanes .. with a substantial mix of “free” shared vehicles therefore is not a “Sure thing” by a long stretch. The NoVa Hot Lanes could be fairly characterized as a true pilot project – even perhaps a bit experimental…

    the number of HOT toll operations in the country with substantial shared vehicles is less than the number of fingers on one hand.

    .. It’s a risky endeavor… which probably explains why the Feds had to kick in 1.2 Billion in financing and 400 million from the State.

    It may well turn out that 55 on most days is no sweat… but there are enough unknowns here that keeping expectations low at least initially is probably prudent.

  4. Anonymous Avatar
    Anonymous

    Good service is undoutedly part of the picture.

    It also appears that around 45 gives the most profit.

    RH

  5. Groveton Avatar
    Groveton

    I am getting the feeling that most of the commentators on this blog do not work for large corporations that invest billions in projects. The motive is profit, profit, profit. I am guessing that this “average speed” calculation involves some type of prnalty payment if the average is not maintained (or bonus payment if it is maintained). The state is saying, as I understand it, that the contractor will be held to a lower standard than had been originally discussed.

    There is a lot of talk on this blog about the private sector and how much more efficient the private sector is versus the public sector. Well … sort of. The private sector’s efficiency is directly related to the amount of competition in a sector. Continuously competitive sectors create continually efficient companies. Occassionally competitive sectors create occasionally competitive companies.

    Efficiency is bred through competition, not the public vs. private structure of the company / agency.

    These toll roads are not competitive. There is not a nearly identical parallel toll road being run by a different company. This is not privatization – it is outsourcing. Jim Bacon has written quite a bit about the state’s (perhaps) failing effort to outsource its IT. I have a funny feeling that we will be looking back on this road outsourcing plan with the same puzzlement with which we are currently viewing the IT outsourcing plan.

  6. Jim Wamsley Avatar
    Jim Wamsley

    Average speed of 45 mph can also be expressed as the minutes spent in the exit queue.

    An open highway speed of 60 mph is a third faster then the contract speed of 45 mph. In other words look forward to spending a delay equal to a third of your open road trip time. That is on the average. For every car that travels outside of the congested period, you get more minutes of congestion delay during rush hour.

    For a 30 mile, 30 minute trip this means 10 minutes average sitting in exit congestion. If half the drivers see no congestion, the rush hour sit becomes 20 minutes. Is this an improvement?

  7. Larry Gross Avatar
    Larry Gross

    I assume Jim is talking about the phenomena that adding capacity on a road segment verses add network capacity essentially results in just “moving” the delay from the new capacity to where that added capacity reverts to the existing unimproved state.

    I’m not sure I agree if pretty much the entire length of I-95 and I-495 has added lanes unless what he is saying is that you’ll just spread out the congestion over the existing surface streets more uniformly or some such.

    Because the surface streets also are affected by rush hour congestion and if the net result of HOT lanes is to “spread” congestion across time.. wouldn’t that happen across the boards to all roads – HOT AND surface streets?

  8. Larry Gross Avatar
    Larry Gross

    I agree with Groveton’s concerns and would cite Dominion and the Cable TV companies as examples of exclusive “franchises” without competition.

    In each/all cases, you have to ask yourself if you’d get more infrastructure investment if you did not offer the exclusive franchises.

    Because.. in each case… the issue for any company .. is how do they recover the up-front cost of the infrastructure if they do not have a contract and the operation of their infrastructure could be turned over to their competitors at some point.

    Groveton – you know the deal here since you work in that arena…

    how do companies invest in infrastructure if it can essentially be given away to competitors at some point?

    And FYI, New Jersey is approaching this idea by forming a STATEWIDE Non-Profit Toll Authority.

    Is than an answer?

    I am not pleased that the Feds essentially gave 1.2 Billion in taxpayer money to Fluor to big the infrastructure and then let Transurban have an exclusive contract to operate the facility and pay back Fluor.

    The obvious question is why should Transurban have such a contract to start with.

    Why not have a 5-year renewable competitive bid contract OR have the state form their own Non-Profit entity.

    I’d be strongly opposed to VDOT being the operator and recipient of the toll revenues over and above those required to service the debt.

    and I’ll go one step further and agree with those who post in this Blog and the FTA in expressing a strong No Confidence vote in the WAY that the Dulles Rail project was/is configured.

    Both of these issues give me great pause in the way that the STATE has NOT protected the interests of taxpayers and allowed foxes in the henhouse…. it undermines public trust and confidence that the state is truly looking for better infrastructure policies… and instead is willing to bail out and let private interests once again co-opt transportation infrastructure for fun and profit.

    What I LIKE about the New Jersey proposal is that a Citizen Board directs the Non-Profit Toll Authority – and acknowledging that a favorite tactic of the nefarious is exactly that – to label the board as “citizen” and then infest it with those who profit from the decisions.

    Our own CTB is “advertised” as a citizen board.. but when you look at the financial interests of the members… you realize that they are not “citizens” in the classic sense of work-a-day constituents/users of transportation.

  9. Anonymous Avatar
    Anonymous

    What a fabulous idea. Charge tolls, and then give the money back to the other drivers. Winners pay, losers receive. Everybody is better off…….

    “Credit-based congestion pricing: A Dallas-Fort Worth application

    Abstract: Under a credit-based congestion pricing policy, net revenues are distributed uniformly among qualifying travelers, to partially offset toll payments. This work predicts the traffic impacts, air-quality changes, welfare effects, and system implementation costs of such a policy, as applied to the Dallas-Fort Worth (DFW) region of Texas.

    Joint destination-mode choice models were estimated and applied. The status quo and two marginal cost pricing (MCP) scenarios were simulated for the short and long terms, with full feedback of trip costs and times. Monetarized logsum differences suggest that marginal cost pricing of congested freeways in this urban region, followed by travel credit distribution to all workers, is welfare improving for the great majority of such travelers. Moreover, high levels of recurring congestion (V/C ratios exceeding 1.5) are predicted to practically disappear.”

  10. Larry Gross Avatar
    Larry Gross

    Here’s the link:

    http://www.trb-pricing.org/docs/06-0939.pdf

    does someone want to try to summarize in standard English what the concept is?

    Also.. this paper is 2 years old… has any of it actually been adopted and implemented?

  11. Jim Wamsley Avatar
    Jim Wamsley

    “Credit-based congestion pricing: A Dallas-Fort Worth application”
    Is a modeling study where congestion pricing revenue is returned to automobile owners.

    Think of it as a robin hood taking money from drivers who drive miles in congestion and giving it to car owners who live close to work or drive outside the congested period.

    This answers the critics that say you should not spend congestion pricing money on capacity increasing roads and transit alternatives.

    The interesting thing was the model didn’t work. It showed that drivers prefered the longer, more costly alternatives. They need to work on the basic model.

    A variation keeps congestion pricing but returns the money to an ez pass account that can be used for transit or sold to another traveler. Everyone would be eligible for an ez pass account.

  12. Anonymous Avatar
    Anonymous

    “The interesting thing was the model didn’t work. “

    I didn’t know that.

    I thought that what you said about an EZ pass was cetral to their proposed system. Everyone was given a certain number of credits or trips, which they could use or sell. If more were needed for some users, they could buy extras.

    I also think the recent Oregon Experiment included that as a feature in the “black boxes” attached to the cars. Everyone got a certain $ amount of credits which they could keep if they didn’t use.

    It wasn’t clear to me if tht was an essential eature of the plan, or just a way to incentivise the testers to make the system look better.

    Regardless, it does seem to me to be a more fair and more market driven approach. Particularly since there are some areas that will not get more infrastructure, no matter how much you collect.

    RH

  13. Jim Wamsley Avatar
    Jim Wamsley

    I consider this problem in a model a failure.

    “The values of travel time (by income group and trip purpose) were constrained in the joint DM
    choice models since the coefficient on the cost turned out to be positive indicating a negative
    value of travel time, which is unreasonable.” lines 20 thru 23

  14. Anonymous Avatar
    Anonymous

    That doesn’t leave us much, does it?

    We are going to collect a bunch of money from auto users, and probably give it over to transit (after profit), since we are not going to build more roads in the most congested areas.

    Transit will make a few properties much more valuable and much more expensive to move to.

    Where is the upside in this?

    I still can’t help but feel a little cynical, after I previously predicted that 45 mph would generate the most revenue.

    Are we about moving people and getting the job done, or is it just money, after all?

    RH

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