A look back california state route 91
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A LOOK BACK: CALIFORNIA STATE ROUTE 91 . Edward C. Sullivan, California Polytechnic State University, San Luis Obispo. Facility Features. 4 lane toll road in median of 8 lane freeway 16 km. in length Express travel (no intermediate access) Heavy vehicles not permitted

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A look back california state route 91 l.jpg


Edward C. Sullivan,

California Polytechnic State University, San Luis Obispo

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Facility Features

  • 4 lane toll road in median of 8 lane freeway

  • 16 km. in length

  • Express travel (no intermediate access)

  • Heavy vehicles not permitted

  • Electronic toll collection only (no cash)

  • Time-dependent tolls, reflecting demand

  • Originally constructed and operated by private company under franchise agreement with the State

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Genesis – Calif. AB 680 (1989)

  • Goals of the legislation:

    • Attract “alternate funding sources” to meet state transportation needs

    • Gain private sector efficiencies in developing projects

    • Reduce congestion in crowded corridors

    • Provide alternate route selections

    • Provide private partners a “reasonable” profit

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Provisions of AB 680

  • 4 demo projects w/ geographic distribution

  • Provides up to 35 year lease of right-of-way and airspace, which then reverts to the State (but may remain a toll road)

  • Projects become part of the state highway system

  • Must meet all applicable laws, environmental requirements, and be built to State standards

  • Any State services fully compensated; state powers (e.g. condemnation) made available

  • “Excess” tolls either go to the State or used to reduce project debt

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The State Route 91 Impact Assessment Study

  • Objective: measure reactions to variable toll pricing and the other innovative features of the toll facility

  • Impacts tracked from mid-1994 through 1999 (one year after opening day)

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The State Route 91 Impact Study – Focus Areas

  • Traffic counts, occupancy counts and speeds

  • Effects on corridor bus, rail and park & ride

  • Effects on accidents and significant incidents

  • Traffic operations at entrances/exits

  • Origin-destination (revealed preference) surveys

  • Public opinion surveys

  • Emissions modeling

  • Calibration of choice models

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Findings – Tolls & Time Savings

  • Express lane use strongly reflects hourly travel time savings

  • Flattening of traffic peaks is weakly responsive to tolls – more responsive in the AM period

  • Commuters typically overestimate time saved by 5-30 minutes

  • Some users cite driving comfort & safety to justify paying tolls if time saving is minimal

  • About 18% do not pay their own tolls

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Findings – User Demographics

  • Income correlates positively with use frequency for all groups

  • Middle-income groups seem relatively most affected by toll increases

  • Being female strongly correlates with using the toll lanes

  • Middle age groups use toll lanes more than the youngest and oldest age categories

  • More education also correlates with toll lane use

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Lessons Learned About User Demographics

  • Results from CA Route 91 show a moderate income effect in travelers’ use of the toll lanes

  • Nevertheless many frequent users are low income, and many high income commuters are infrequent or non-users

  • Having said all this, the choice to use the optional toll lanes seems more related to current travel conditions and needs than to user demographics

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Findings – Ridesharing & Transit

  • Toll incentives were accompanied by long-term increase in 3+ ridesharing

  • HOV users have been more likely to use X-lanes

  • Flexible work schedules seem unrelated to X-lane use

  • No significant impacts on corridor transit use (public transit is about 1% of total corridor travel)

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Findings – Collision Experience

  • Accident rates in the corridor have generally varied with congestion – there appear to be no particular effects related to the special operating characteristics of the toll lanes

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Findings – Public Opinion

  • 91X lanes’ image suffered in 98-99 from disputes about ownership & congestion

  • Approval of variable tolls fell but overall approval of toll financing remains high

  • Toll payers express higher approval of variable tolls than non-payers

  • Approval declined for private operation

  • Approval of HOT lane concept is high

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Seeds of De-Privatization

  • Traffic growth led to substantial renewed congestion

  • Some partners changed business strategy and wanted out

  • A 1999 buy-out offer from start-up non-profit (New-Trac) for $260 million was widely perceived as sweetheart deal contrary to public interest, with a major political outcry

  • A 1999 CPTC lawsuit against Caltrans stopped planned capacity improvements (Caltrans settled)

  • A 2000 Riverside County lawsuit against CPTC and Caltrans tried to void the franchise agreement

  • At least two unsuccessful legislative bills (AB 1091, AB 1346) sought to void the non-compete clause and have the public acquire the toll lanes by condemnation

  • In 2001, CPTC successfully refinanced $135 million in debt to pay loans from partners and cover remaining construction debt at 7.63% rather than 9%

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De-Privatization Arrives

  • In spring 2002, the CPTC and the Orange County Transportation Authority (OCTA) agreed to a sale of the 91 franchise for $207.5 million

  • In fall 2002, the governor signed AB 1010 which, among other things, authorizes the transfer

  • The sale became final in January, 2003

  • CPTC metamorphosed into Cofiroute Global Mobility, which now operates SR 91 for OCTA

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Provisions of AB 1010 (2002)

  • Authorizes OCTA to buy the CPTC franchise

  • Calls for improving congestion by eliminating the non-compete clause

  • Calls for reduced SR 91 tolls and a minimum toll period

  • All projects become non-toll when franchises expire

  • No more new franchises after January 1, 2003

  • OCTA prohibited from transferring its franchise without State approval

  • Creates an SR 91 advisory committee with strong local political control

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A Good Deal for All

  • CPTC receives $135 million to cover its (newly refinanced) debt plus $72 million for the original partners

  • OCTA can use a 30 year payback schedule of $13 million per year

  • An Ernst & Young study for OCTA predicts $40.5 revenue by 2010 with daily traffic to grow from 25,500 in 2001 to nearly 64,000 in 2030

  • HOV-3+ again travel free (except during the worst of the afternoon peak, where the 50% toll is maintained)

  • In Nov., 2002, voters approved Measure A to provide nearly $1/2 billion in road improvements elsewhere in the 91 corridor, which would have been blocked by the non-compete clause

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In Retrospect

  • Despite de-privatization, the SR 91 project was a very successful project on many dimensions

  • It was an innovative model that helped establish in the U.S. an open mind toward market-based road pricing

  • It proved that public-private highway partnerships can be financially successful

  • The Achylles heal of this privatization project turned out to be the non-compete clause in the franchise agreement

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More Final Observations

  • Public-private infrastructure projects should be eligible for tax-exempt bonds, even with a for-profit private partner (OCTA debt will be about 5.5%, compared to CPTC’s 7.6%)

  • SR 91 showed the value in having the public partner obtain prior environmental clearance, on a reimbursement basis

  • Given the resource limitations of most public transportation authorities, the SR 91 non-compete clause was probably neither needed nor desirable

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The “Bottom Line”

  • CA Route 91 has demonstrated that innovative road pricing (premium service for a premium price) can be economically attractive, win public approval, and significantly influence travel behavior.

  • Increasing traveler options is a subtle yet powerful outcome from such value pricing projects.

  • “One size fits all” in road pricing has clearly failed. Increasing transportation choices through pricing has succeeded in CA and deserves careful consideration elsewhere.