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Turning up the Heat on Traffic Gridlock

By Ian Parry and Elena Safirova

May 5,2004

The transportation reauthorization bill recently cleared by the Senate and the House has been widely criticized for excessive pork and busting the administration’s spending caps. And negotiations are now under way to avert a possible presidential veto. However, history may view the bill somewhat more positively in light of some provisions that provide modest incentives for the development of so-called HOT (high occupancy toll) lanes. In the interim, lawmakers would be well advised to strengthen and expand those provisions. If HOT lanes were to catch on, they could at last mark the turning point in the battle against ever increasing gridlock in the nation’s cities.

Traffic delays and the resulting extra fuel combustion now cost the nation around $70 billion each year. On average, the amount of time an urban motorist loses to congestion during rush hour has grown from 16 hours per year in 1982 to 62 hours in 2000. Without new policy initiatives congestion is likely to worsen with continuing growth in vehicle ownership and increasing difficulty of building new roads due to neighborhood opposition and budgetary limitations.

Simply put, traffic congestion is caused by too many people driving on busy roads during morning and evening rush hour. The best way to reduce congestion would be to charge people for driving on busy roads at peak times, thereby encouraging them to alter their work habits to avoid driving then, to drive on less congested routes, and to consider mass transit. Higher fuel taxes are a far less effective solution because they raise the costs of all driving, regardless of whether it is in urban or rural areas or occurs at peak and off-peak periods. In turn, increased transit subsidies may become self-defeating; if roads become less congested because some people decide not to drive to take advantage of lower transit fares, other people who were not previously driving at peak period because of high congestion may be attracted onto the roads, causing roads to fill up again with traffic.

Over the last two decades, there has been a substantial investment in adding high occupancy vehicle (HOV) lanes to urban freeways. But for the most part, they have done little to encourage more carpooling, and many are greatly underused compared with parallel, unrestricted lanes, on the same freeway. Converting HOV lanes into HOT lanes by allowing single occupant vehicles to use them in exchange for a fee, while excluding high occupancy vehicles from the charge, would benefit many road users. Those who value the travel time savings enough to pay the fee are better off, while those who continue to use unpriced lanes may benefit from reduced congestion as some drivers switch from them to the premium lane. Carpoolers who were initially using the HOV lane may be slightly worse off as more vehicles join premium lanes. However the fees, which would be deducted electronically as vehicles pass under overhead meters, could be varied according to traffic conditions and set at levels to maintain free-flowing traffic, even at the height of the rush hour.

Under HOT lanes, no one is forced to pay tolls as drivers can always use the parallel, unpriced freeway lanes for free. Therefore, it is not true that low-income families, who are least able to afford tolls, will be driven off the roads; they may actually benefit from reduced congestion on the unpriced roads.

It makes sense to introduce pricing incrementally, increasing the number of priced roads as its success in alleviating congestion becomes evident to the general public. California’s two HOT lanes, which have been operating for several years, have demonstrated the ability of variable electronic pricing to maintain free flowing traffic, and people of all income levels use HOT lanes when saving time is important to them. Recent surveys in California show widespread public acceptance of the HOT lane concept.

Over time urban centers could develop a network of interconnected HOT lanes providing drivers with access to any part of the region without major holdups and allowing local authorities to provide express bus service throughout the region, reducing the need for constructing costly light rail systems. Although many additional HOT lanes would need to be constructed to link up the existing, rather fragmented systems of HOV lanes, the toll revenues that would be forthcoming could finance much of the required funding, according to the Reason Foundation.

The transportation reauthorization bill at last removes unnecessary restrictions that have held up experiments with HOT lanes on locally managed roads. However, a better bill would go a good deal further to jump-start pricing experiments at the local level. First, cumbersome restrictions that have deterred the introduction of tolls on interstate highways could also be removed. Second, legitimate fears about privacy could be partly addressed by legislation making it a criminal offence for information collected about drivers’ habits to be used for purposes other than collection of tolls. Third, federal funding could be provided to pay for some of the costs of setting up HOT lanes. And fourth, a nationwide standard for electronic toll technology could be established to prevent motorists from having to install a different transponder when they drive in a different city.

Nonetheless, provisions for HOT lanes in the current bill are a welcome step in right direction and could hasten the day when people have the option of getting to work without fuming in traffic jams.

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Ian Parry is a a senior fellow and Elena Safirova is a fellow at Resources for the Future (RFF). RFF improves environmental and natural resource policymaking through objective social science research of the highest caliber.



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