States Consider Tolling to Generate Transportation Revenues, Relieve Congestion

A variety of states are taking steps this year to consider tolling as they seek to generate revenues for transportation, relieve congestion and perhaps qualify for federal transportation funding, which could be more difficult to come by in the future. I have updates on expanded tolling legislation in Utah, tolling studies in Iowa and Minnesota and the failure of a congestion pricing plan in New York. Plus, details on how to attend one of the nation’s premier conferences on public-private partnerships this June.

Here’s a roundup of what’s been happening on tolling around the country:

  • Connecticut: The legislature’s Transportation Committee last month passed a series of bills that could establish tolls on Interstates 84, 91 and 95 and on the Merritt and Wilbur Cross parkways, The CT Mirror reported. The votes on the bills were split along party lines so their ultimate fates are uncertain, particularly in the evenly split Senate. But if approved by the House and Senate, the measures would require a study and a formal proposal by the state department of transportation followed by a second vote by the legislature in 2019 before tolls are authorized. Gov. Dannel Malloy has said Connecticut needs to raise additional revenue to support road and bridge projects and has suggested that the state’s congested freeways are killing job migration between New York and Connecticut.
  • Iowa: A recent study found that tolling Interstate 80 could feasibly fund the widening of the road. But Iowa Department of Transportation Director Mark Lowe says the state is putting brakes on any discussion of tolling. “It’s just not a good fit for a rural, farm to market state like Iowa,” Lowe told The Gazette newspaper. “Tolling certainly has a place, particularly in highly urbanized, highly controlled, highly congested corridors, but that’s not really how to describe Iowa’s system.” Other state policymakers and stakeholders have also come out against tolling the interstate. Senate Transportation Committee Chairman Tim Kapucian said recently he’s interested in finding an alternative to tolls, such as raising truck weight limits and increasing truck license fees. Officials in Nebraska have said they’re not on board with tolling I-80 either. But a staff editorial in The Gazette argued policymakers shouldn’t be so hasty to dismiss the study. “State policymakers breaking the interstate speed limit to distance themselves from the tollway study also demonstrates a much broader problem with Iowa politics - the people in charge often seem afraid of taking on big, bold ideas which may be politically uncomfortable,” the editorial read. “Many Iowans have noticed a pattern in state government, a repetitive cycle of studies, recommendations and inaction. That may serve politicians fixated on their next election, but it does little to solve the very real problems Iowans face.”
  • Louisiana: Transportation and Development Secretary Shawn Wilson said last month the administration of Gov. John Bel Edwards would be willing to consider tolling on existing interstates to generate revenues to repair those roads, The Times-Picayune reported. While federal law does not currently allow tolls on existing interstates, President Trump has proposed allowing them as long as the revenues generated are used to repair and upgrade the interstates themselves. Tolling is currently allowed on newly constructed highways to cover construction costs.
  • Minnesota: The Minnesota Department of Transportation in February came out with a state legislature-mandated study on how much money could be raised by converting some existing highways into toll roads. Department officials, in presenting it to the legislature in February, described it as a “high level study” based on a number of assumptions (it assumed flat pricing rather than dynamic pricing, for example), as opposed to a more detailed feasibility study. Nevertheless, officials said the study indicated that while tolling could be a possible way to increase revenues, it couldn’t be counted on to cover the entire cost of reconstructing the state’s aging highways. 
  • New York: A congestion pricing plan for New York City won’t happen this year after lawmakers didn’t make it a part of the state budget agreement agreed to last week, The New York Times reported. Instead the legislature voted to add new surcharges onto every ride in a for-hire vehicle (taxis, ride-hailing vehicles, car pool services) in Manhattan south of 96th street. Late last year a panel had recommended a phased approach to congestion pricing, which would have levied tolls of $11 or more as a way to reduce gridlock while raising money to upgrade transit in the city. Congestion pricing for New York City has been considered since at least the 1970s with the last major effort in 2008 under then-Mayor Michael Bloomberg. That effort failed when legislative leaders in Albany refused to bring it to a vote. Internationally, the cities of London, Stockholm and Singapore have all deployed congestion pricing with success. Governing magazine reports this week about governments increasingly turning to taxing ride-hailing companies as a way to fund transit. I also touch on that in another recent post.
  • Oregon: The Oregon Department of Transportation is considering using “value pricing” to reduce Portland area congestion on Interstates 5 and 205 by charging people more when they drive during rush hour, KOIN-TV reported. State lawmakers reportedly recently directed ODOT to submit an application to the federal government that if approved would allow congestion pricing on the corridors.  
  • Rhode Island: Construction began in February on the first two toll gantries to collect cash from large commercial trucks on the state’s highways, WPRI-TV noted. A total of fourteen toll locations are planned as part of the 2016 RhodeWorks law signed by Gov. Gina Raimondo, which seeks to fund a 10-year road-and-bridge repair plan by tolling the tractor-trailer trucks transportation officials argue do the most damage to the state’s roads.
  • South Carolina: Lawmakers are reportedly considering legislation that would allow toll funding for I-73, a proposed $2 billion interstate to Myrtle Beach. Gov. Henry McMaster recently expressed hope that President Trump’s infrastructure proposal could benefit the controversial project if it ever gets off the ground in Washington. The I-73 project faces potential legal challenges, is currently not a priority for the state DOT and has no state money committed to it, according to The Greenville News.
  • Texas: Democratic state Sen. Kirk Watson told business and civic leaders in Austin recently that toll roads are the key to solving serious traffic congestion problems in the state, The Austin American-Statesman reported. But the Texas Transportation Commission last year removed tolls from the state’s toolbox of road financing mechanisms after Gov. Greg Abbott and Lt. Gov. Dan Patrick, both Republicans, took anti-toll stances. That has left the Central Texas Regional Mobility Authority wondering whether it can proceed with any new toll projects, Community Impact Newspaper reported.   
  • Utah: Gov. Gary Herbert has signed legislation (SB 71) to expand the state’s authority to collect tolls on any roadway. The approval of the legislature will not be necessary for future toll projects and the Utah Department of Transportation would be responsible for tolling decisions, Land Line magazine reports. The legislation also seeks to modernize toll collection. State lawmakers argued Utah’s congestion issues continue to worsen despite efforts to address the issue in recent years including by increasing the state gas tax and tapping general fund dollars for transportation needs.
  • Virginia: Lawmakers have approved a bill (SB 971) that asks the Commonwealth Transportation Board to evaluate the feasibility of using toll financing to improve Interstate 81 throughout Virginia. … Elsewhere in the Commonwealth, Dulles Toll Road officials are upgrading the toll collection system to allow drivers to pay by credit card and use a self-service option if they don’t have an E-ZPass transponder, The Washington Post reports. The new system could reportedly allow variable tolls to be charged in the future. Some have been critical of variable tolls on Interstate 66 inside the Capital Beltway that have on occasion reached $45 dollars or more for solo drivers on their morning commutes. But recent traffic data shows that the tolls have boosted speeds in the morning while having little impact on travel times during the afternoon rush hour, WTOP reported. The radio station also noted elsewhere that the first major construction work on I-66 toll lanes between the Capital Beltway and Gainesville, Virginia is set to begin this weekend. The new toll lanes are due to open by the end of 2022.
  • Wisconsin: Some state lawmakers in recent weeks have suggested Wisconsin may need to consider toll roads if it wants to qualify for federal transportation funds through President Trump’s proposed infrastructure plan, The Journal Sentinel reported. Gov. Scott Walker suggested he wasn’t ready to back tolling and would only do so if taxes were cut by an equal or greater amount.

Further Reading

Upcoming Conference to Highlight Public-Private Partnerships

Major toll road projects around the country are likely to be on the agenda this June at the US P3 Infrastructure Forum 2018 hosted by Inframation. It takes place June 13-14 at The Hilton Midtown in New York City. CSG is pleased to be a supporting organization and media partner for the conference this year, which brings together state and federal public officials and regional transportation authorities, along with infrastructure developers, investors and financiers to talk about what’s happening with public-private partnerships around the country and the issues that are shaping the industry’s future. Among the speakers already announced for the event are key state transportation officials from Arizona, Colorado, Maryland, Michigan and Pennsylvania. You can find out more about how to register for the conference at the early bird rate and register your interest to receive the full agenda once its released on the event website. I’ll also have more details here on the CSG Knowledge Center in the weeks ahead. And for an idea of what to expect, you can read my coverage of the 2016 forum here.