Creating a Market-Based Transportation System

1. Creating a Market-Based Transportation System Baruch Feigenbaum Transportation Policy Analyst—Reason Foundation October 28, 2013

2. Presentation Summary • What is a Market-Based Transportation System? • Why it is More Effective • Freeways • Arterials • ITS Solutions • Creating a Transit Network • Funding/Financing • Coalitions

3. Market-Based Transportation • Focuses on creating a network of highways and transit • Tries to have users pay full costs of trips • Regional focus not corridor focus • Builds facilities that help both Cars and Transit ex) Managed Lanes

4. Congestion Sources • Non-recurrent: Unpredictable due to traffic accidents, weather • Recurrent: Predictable due to excess cars on highway • Non-recurrent congestion addressed: • Towing Program • Proactive approach for Winter Weather • Highway Patrol/Police have officers in spots with frequent accidents • Better warnings of work zones

5. Recurrent Congestion Freeway Solutions • General Purpose and Managed Lanes • Freeway Bottleneck Removal • Large interchanges with outdated designs • Ex) I-285 at GA 400, I-95 at I-495 VA • Modest Freeway Additions • Particularly 4-lane freeways or those not appropriate for Managed Lanes, • Ex) I-75 Henry County GA, I-95 Prince William County VA • Managed Tolled Lanes (lanes in which the highway operator restricts use or applies pricing, capacity requirements or other vehicle requirements to proactively manage demand and capacity • ex) Add Managed Lanes to I-285, I-495 Express Lanes

6. Freeway Network • Two components: Unpriced Lanes, Priced Managed Lanes • Some new un-priced capacity but mostly outside central metro area • Challenge with traditional roadway widenings in growing areas: Induced Demand • Induced Demand: • Growing metro areas more people will use highway • People will make extra trips ex: Braves Game • Other challenges: High cost of land

8. Managed Lanes • Original Vision: 1,200 mile Managed High Occupancy Vehicle lane network • Problem with HOV Lanes is “Goldilocks Theory” • Too Hot: too many people use, lanes become congested do not provide reliable trip time • Too Cold: too few people use, lanes ineffective at reducing congestion in GP lanes • Need for funding, poor performance of HOV lanes led to Managed Lanes System Plan: FHWA, GDOT, SRTA, GRTA, ARC, TPB, Chamber of Commerce • Priced Managed Lanes Mix of 3+ and Super Carpool (vanpool/bus) • Tolled Managed Tunnel

10. Implementation Requires PPPs • Public-private partnerships (P3s) are contractual agreements formed between a public agency and a private sector entity that allow for greater private sector participation in the delivery and financing of transportation projects • There are many types of PPP • Gold standard for highway projects are Concession and Availability Payments; both include Design, Finance, Build, Operate, and Maintain steps • Less comprehensive include DBF, DBFO, or other variations

11. PPP Myths • Myth: PPPs cost GA jobs • Reality: International companies hire local workers. Cannot build I-75 in Australia • Myth: PPP deals prevent state and local officials from improving area roads • Reality: I-75/I-575 contract allowed state to build new parallel roads. State could improve US 41, state could build new parallel highway 10 feet from I-75. • Myth: PPPs commit future generations to unreasonable long-term contracts • Reality: Other contract terms are longer than 30 years. Why are highways treated differently than other infrastructure?

12. Arterial Network • Arterials are the backbone of any metro area’s transportation network • Arterials provide redundancy, travel options • Most important need in 2013 is to improve connectivity • Relatively low-cost • Very Large and Large Arterial Plan two parts: • 1) Regional Primary Arterials using grade separation and ITS features • 2) All Other Arterials

13. Regional Primary Arterials • Regional Primary Arterials, Multiple parts: • 1) Variable Traffic Signal Synchronization: Adjusts traffic lights based on actual travel conditions • 2) Queue Jumps: Provides priority signals/lanes to buses to improve bus, BRT service • 3) Access Management: Reduces turning motions on busy arterials • 4) Grade Separation: For busiest intersections add bridges/tunnels to reduce traffic conflict

14. Pictures Variable Traffic Signal Synchronization Queue Jump Access Management Grade Separation

15. Managed Arterials • Pay small fee to use overpass or underpass to bypass congested intersection • Studies in Fort Myers area shows high feasibility • Focus group positive to idea and optional toll of$0.25-$0.50 • TRB-accepted method for solving congestion

17. Existing Dynamic Traffic Management/ITS • ITS systems very cost effective • They also improve Arterials and Transit system • Challenge in 2013 is use traffic cameras not merely to inform commuters where congestion exists but to actually prevent congestion in the first place • Change light synchronization • Route traffic to different routes before congestion develops

18. Transit • Create a redundant transit network • Use existing rail network with additional stations? • No new rail • Add additional local bus routes, increase frequency • Add additional Express bus routes, increase frequency • Add BRT routes, increase frequency • Create a Mobility Management Center to coordinate bus service, vanpooling, carpooling and other transit activity

19. Consider Nontraditional Transit • Encourage vanpools which can take advantage of Managed Lanes network • Encourage casual carpools • Drivers pick-up people at designated locations • Safe: No problems reported in 10 years in Houston • Rural areas/less populated counties: Demand-Response Transit

20. Use the 3 principles of good transit service • Contracting and Competitive Bidding: Have outside vendors and the local transit agency bid for service • Implementing Time of Day and Distance Based Pricing • Only Post-WWII heavy rail system without distance based pricing (Others: San Francisco, Washington) • Benefit bus riders by offering service that actually meets demand • Potential vouchers for low-income • Coordinating Agency and Mobility Management Center

21. Funding and Financing Resources • User-pays/User-benefits system • Spend gas tax money on transportation needs • Many states spend gas tax money on non-highway purposes • Transit, Non-motorized, Police • General Uses, Education, Health Care • Examine other user-pay revenue sources • Mileage-Based-User-Fees (GA is not ready) • Enhanced use of tolling and public-private partnerships • Not a solution in all cases but a major part

22. Is Gas Tax Money Spent on Transportation • GA only 16.35 cents C) about 50% is spent on transportation • State where constitutional restriction on how gas taxes are spent Georgia Gas Tax Funding Chart

23. Other Sources • Electric Car Fee • Small but growing part of Georgia’s fleet • Since pay no gas taxes, pay an annual fee of $180 to state of Georgia • Tolling • Key part of revenue • Simple, easy to collect using All Electronic Tolling • Collection costs are 5% similar to fuel taxes • Most perfect user fee since drivers pay specifically to drive on certain roads • Mileage Based User Fees • Ideal revenue source • Pay for the exact amount of miles you drive • Free of subsidies and transfers

24. Transit Funding • House in Department of Community Affairs, Urban Development? • State provides funding $120 million per year, $70 million for metro Atlanta, $50 million for other areas of state • How? (Prioritize Resources) • General Funds

25. Transit Financing • PPPs • Transportation Infrastructure Finance and Innovation Act (TIFIA) Loans • GARVEEs, GANs, Hybrid, Private Activity Bonds • Value Capture promising way to fund rail transit and BRT • MARTA can use to make needed repairs to 30+ year old fleet • New BRT lines can use to cover costs of lanes and ITS features • Need transit component for political reasons

26. Importance of Political Coalitions • Consider groups that share your goals: NAACP • Develop a campaign • Land use Development follows the market • Campaign needs to include both highways and transit in most communities • Focus transit on bus-based not rail-based

27. Questions Baruch Feigenbaum Reason Transportation Policy Analyst baruch.feigenbaum@reason.org