Value Pricing Projects: Public Involvement

1
Value Pricing ProjectsPublic Involvement
Equity Issues

• K. Lynn Berry
• Resource Center
• Environment TST

2
1994

• The reasons for rejection of congestion pricing
  in the past have not changed. Any shift from the
  current system of financing and using the
  transportation system toward more marketlike
  mechanisms can be expected to engender public and
  political resistance
• Committee for Study on Urban Transportation
  Congestion Pricing

3
2006 DOT initiatives

• 59 pricing projects reported in 1st Q 2006
• Public-Private Partnerships (PPP) Office
• Value Pricing Pilot Program
• funded at 59 million through 2009
• Tolling and Pricing Team
• Special Experimental Project No. 15 (known
  colloquially as SEP-15)
• "Open Roads" pilot program

4
2006 Secretary Mineta Says

• It is time to take advantage of the private
  sectors flexibility, innovation, creativity,
  expertise and access to capital."
• May 24, 2006 letter to Thomas E. Petri, Chairman
  of the House Highways and Transit Subcommittee

5
Urban Partnership Agreements

• Candidate cities may
• demonstrate congestion pricing and variable toll
  programs,
• implement expanded commuter express bus services
• expedite projects to expand highway capacity that
  hold the greatest potential for reducing
  congestion and bottlenecks.

6
SEP-15

• innovative contracting
• compliance with environmental requirements
• right-of-way acquisition and
• project finance.

7
SAFETEA-LU provisions

• Private Activity Bonds
• Expanded tolling authority
• Lowered eligibility threshold for TIFIA loans

8
Private Activity Bonds

• Highway facilities and surface freight transfer
  facilities added to a list of other activities
  eligible for exempt facility bonds.

9
Tolling

• Interstate System Construction Toll Pilot Program
• Interstate System Reconstruction and
  Rehabilitation Toll Pilot Program
• Value Pricing Pilot Program
• Express Lanes Demonstration Program

10
TIFIA

• SAFETEA-LU authorizes a total of 610 million
  through 2009 to pay the subsidy cost of
  supporting Federal credit under TIFIA
• Threshold required for total project cost is
  lowered to 50 million (15 million for ITS
  projects),
• Eligibility is expanded to include
• public freight rail facilities
• private facilities providing public benefit for
  highway users,
• intermodal freight transfer facilities,
• access to such freight facilities
• service improvements to such facilities including
  capital investment for Intelligent Transportation
  Systems (ITS).

11
What is a Public Private Partnership ?

• contractual agreements formed between a public
  agency and private sector entity

12
What are some types of PPPs?

• Build-Operate-Transfer (BOT) / Design Build
  Operate Maintain (DBOM)
• Design-Build-Finance-Operate-Transfer (DBFO)
• Maintenance and Operation Fee Service Contracts
• Program Management Fee Service Contracts
• Build-Own-Operate (BOO)

13
Concession Agreements

• Indiana, Virginia, Texas and the City of Chicago
• long term lease of an existing transportation
  asset
• Texas and California
• construction of a new asset by a private company
  and the lease of that asset to the private sector
  for a period of

14
Environmental Defense Agrees
15
What Role For Road Pricing?

• Managing traffic congestion, traffic growth, and
  pollution
• Financing road system expansion, operations,
  mitigation of adverse impacts
• Financing transit, para-transit, walking, biking
• Supporting and financing growth management

16
Getting Better Transportation Projects Faster?

• Incorporate pricing with smart growth, better
  transit in plans and projects
• Avoid or mitigate secondary induced, cumulative
  impacts
• Involve the public

17

• Do Value Pricing projects differ from traditional
  projects in terms of public involvement and/or
  equity analysis?

18
Pricing Projects

• Less about direct impacts
• More about access, public uncertainty, equity

19
Equity Concerns

• "If you are well-off financially and want to pay
  4 or 5 a day to avoid congestion, then you get
  to use the lanes. But if you're a working person
  out there making 35,000 a year, an extra 25 per
  week is a lot of money.
• Former Maryland Governor Parris Glendening (2001)
• Controversy halted HOT lanes on Rte. 50

20
Equity Concerns

• Not fair to provide better mobility to the
  wealthy?
• Data show low-income motorists consider it fair
  and do use priced lanes
• Ways to increase benefits to low-income travelers
• Use tolls to provide new transit services
• Provide life-line toll credits
• Provide credits to all motorists in regular lanes
  

From Mainstreaming Pricing Alternatives in
Project Development. By Patrick DeCorla-Souza
Frederick Skaer. Presentation at the Annual
Meeting of the TRB January 2003.
21
Equity Analysis Findings

• Horizontal equity1 increased
• User pays those who benefit the most pay the
  most
• Vertical equity2 achieved by off-setting benefits
  to low-income drivers
• transit options, revenue rebates, etc.
• Tolls no more regressive than gas tax

1fairness among individuals or groups with
similar resources and needs 2fairness among
individuals or groups with different resources
and needs
22
Equity Analysis Findings

• Financial burden will depend on
• the frequency and duration of roadway usage
• whether there are travel alternatives to the
  tolled facility
• Burden may be expected to decline over time if
• program is predictably and gradually implemented
• users have time to adjust to the new prices
• users make different choices about locations in
  which to live and work.

Victoria Transport Policy Institute (2005) TDM
Encyclopedia
23
Equity Analysis FindingsI-15, San Diego

• There is a greater proportion of higher income
  drivers (e.g. households with annual incomes over
  80,000) in the HOT lanes than in the un-tolled
  lanes.
• Low income drivers use the HOT lanes, but not as
  much as the un-tolled lanes. Drivers with
  household incomes of 20,000 to 40,000 a year
  made up 3 of FasTrak users, and 10 of drivers
  in the free lanes.
• There is broad public support of the HOT lane
  program

Supernak, Janusz C. (2004) http//www.hhh.umn.edu/
centers/slp/projects/conpric/index.htm
24
Equity Analysis FindingsSR-91, Orange County

• Drivers with higher incomes use the lanes for a
  greater proportion of their trips
• some low income persons are certainly among the
  frequent users
• No income group seems to consider it worthwhile
  to use the tolled lanes for every trip
• most users use them infrequently, when they
  perceive the greatest benefit

Sullivan, Edward. 2004 http//www.hhh.umn.edu/cent
ers/slp/projects/conpric/index.htm
25
Equity Analysis Findings Katy (I-10) Freeway in
Houston, TX

• Enrollees of the QuickRide have higher incomes,
  and were younger, than drivers who did not
  enroll.
• The price/means of enrollment may prohibit some
  individuals with lower incomes from participating.

Burris, Mark and Robert L. Hannay. 2003. Equity
Analysis Of The Houston Quickride Project. Paper
Submitted for TRB
26
Equity Analysis Findings

• Project operational details can be designed to
  improve equity
• Transponder distribution
• Credit card only vs. cash deposits
• Availability of lower up-front costs
• 27 of US households do not have a credit card at
  all
• 1 in 10 adults in the US does not have a bank
  account on which to draw a check or establish
  automatic transponder replenishment.

Emily Parknay, Environmental Justice Issues
Related to Transponder Ownership and Road
Pricing. TRB 2005 CD-ROM
27
Addressing Equity

• Commonly utilized strategies for pricing projects
• revenue expenditures
• equity analysis
• public involvement and
• pilot projects

Ranked by direct action
28
Addressing Equity

• Jurisdictions Grouped
• The Actors
• The Deliberators

29
The Actors

• Minnesotas I-394 (Hinnepin County)
• San Diego, Californias I-15
• Seattle, King County, Washington SR 167
• Port Authority of New York and New Jersey bridge
  and tunnel crossings

30
The Deliberators

• Lee County, Florida Toll bridges
• The New Jersey Turnpike Authority (Hudson
  County)
• Orange County Californias SR-91
• I-10 (1998) and U.S. 290 (Houston, Harris County,
  TX)
• Orange County, California, San Joaquin Hills Toll
  Road (SR 73)

31
Characteristics Analyzed
32
Key Findings

• The Actors
• have fewer minorities or foreign-born persons
• are more educated at both the high school and
  college levels
• median income is higher, though the percent below
  poverty reports slightly higher.
• greater percentage of people vote
• more of them vote Democrat than Republican

33
State Level Variables
34
I-394 HOV/HOT Lanes

• I-394 HOV Lane built in 1992
• In 2003, Legislature authorized HOV conversion to
  high occupancy toll (HOT) lanes
• Revenue Use
• After project infrastructure, etc., 50 for
  transit improvements and 50 for corridor
  improvements (state law).

35
I-394 Express LanesCommunity Task Force

• 22-person group of leaders and citizens appointed
  by the Governor and Lt. Governor and communities
• Bi-partisan and diverse make-up, local
  representatives
• Reviewed express lane issues
• Prices, access, enforcement, hours of operation,
  etc.
• Provided input to Mn/DOT
• Also sought input from interested people and
  groups
• Open Houses, Focus Groups, Community Council
  presentations

36
But that was only after . . .

• a tumultuous history with other road pricing
  project proposals.
• a decade of public discussion and political
  debate
• a Citizens Jury1 process revealed that the
  public overwhelmingly rejected the notion
• the University of Minnesotas Humphrey Institute
  of Public Affairs
• carried out a research, education, and
  communications strategy for value pricing during
  2002 and 2003 to help generate interest and
  support

A Value Pricing Education and Outreach Model The
I-394 MnPASS Community Task Force TRB Paper No.
06-2250 By Kenneth R. Buckeye and Lee W. Munnich,
Jr.
37
Task Force Model Was Key

• Traditional public involvement models fall short
• limited interaction
• too little opportunity to respond and integrate
  public input
• The process Mn/DOT pursued required sharing
  control of project details and decisions

A Value Pricing Education and Outreach Model The
I-394 MnPASS Community Task Force TRB Paper No.
06-2250 By Kenneth R. Buckeye and Lee W. Munnich,
Jr.
38
Other Lessons Learned

• Top-Level Champions are Helpful
• Governor used highly visible platform to
  thoroughly explain the issue to skeptical
  stakeholders and citizens.
• Grasstops Coalition Is a Prerequisite
• Leaders built a peer-to-peer coalition
• Coalition Requires Constant Maintenance
• Required tending by individuals with experience
  in managing diverse public policyoriented
  coalitions.

Value Pricing and Public Outreach Minnesotas
Lessons Learned by Lee W. Munnich, Jr., and
Joseph D. Loveland Transportation Research
Record Journal of the Transportation Research
Board, No. 1932, Transportation Research Board of
the National Academies, Washington, D.C., 2005,
pp. 164168.
39
Other Lessons Learned

• Preparation Must Precede Promotion
• Every time they answered a question we dont
  know yet, public skepticism about the
  feasibility of the proposal grew.
• No Question Goes Unanswered
• An accusation unanswered can quickly become an
  accusation believed.
• Customize Messages
• A one-size-fits-all message didnt work

Value Pricing and Public Outreach Minnesotas
Lessons Learned by Lee W. Munnich, Jr., and
Joseph D. Loveland Transportation Research
Record Journal of the Transportation Research
Board, No. 1932, Transportation Research Board of
the National Academies, Washington, D.C., 2005,
pp. 164168.
40
Other Lessons Learned

• Show, Dont Just Tell
• even people who are well briefed on the concept
  of value pricing have a difficult time fully
  understanding it
• videotape of underutilized local HOV lanes and
  successful HOT lanes in other parts of the
  country
• In meetings, actual transponders were often
  passed out to help people see and feel how
  electronic tolling would work.

Value Pricing and Public Outreach Minnesotas
Lessons Learned by Lee W. Munnich, Jr., and
Joseph D. Loveland Transportation Research
Record Journal of the Transportation Research
Board, No. 1932, Transportation Research Board of
the National Academies, Washington, D.C., 2005,
pp. 164168.
41
Some More TRB resources

• Presenting Congestion Charging to the Public
  Exampes from Edinburgh and London (P03-6556)
• Alasdair Cain, University of Westminster, United
  Kingdom
• Lessons Learned from California's Successes and
  Failures in Value Pricing (P03-6557)
• Ed Regan, Wilbur Smith Associates
• Public's Response to Florida's Value Pricing
  Projects (P03-6558)
• Kris Cella, Cella Associates, Inc.
• Involving the Public in a New Concept Managed
  Lanes (P03-6559)
• Tina Collier, Texas AM University