Fisher on HOT Lanes: Arguments Run Cold

Marc Fisher, a metro columnist for the Washington Post, has launched a full-scale assault on the HOT lanes proposed for the Washington metro area, mainly on the grounds that they benefit only the rich and powerful. He uses three key arguments against the congestion tolls:

1) Lexus lanes seem unfair to low- and middle-income commuters who can’t afford to shell out the big bucks. In Virginia, where prices could vary according to traffic volume, planners say it could cost up to $42 per day roundtrip between Prince William County and the Pentagon on the HOT lanes scheduled to be built along Interstate 95.

2) Folks tend not to believe the new lanes would really save much time. After all, look how congested HOV lanes have become on I-95.

3) The structure of these deals, with private companies winning the right to profit off traditionally public infrastructure, sets off many people’s stench meters. Because public dollars built almost all roads in the first place, exorbitant tolls feel like double taxation.

None of Fisher’s arguments hold water. Point for point, here’s why

1) Hot lanes unfair. HOT lanes along I-95 might cost $42 for commuting both ways, but few low/middle-income people would use it for that purpose. They would use the lanes only when time was at a premium. The lanes would give them an option they did not possess before. Insofar as new HOT lanes took traffic off existing lanes, low/middle-income motorists actually would benefit.

If low/middle commuters do choose use the HOT lanes to cut the time of their drive to/from work, they can avail themselves of numerous options: car pooling, van pooling, buses and other forms of ride sharing in which riders share the cost of paying the toll. Ride sharing with one other passenger would cut the cost per person in half; sharing with two would cut the cost by two thirds.

2) Hot lanes don’t work. If the lanes don’t save much time, then people won’t use them and they won’t have to pay the charge. D’oh! Ideally, tolls would be set at rates consistent with a level of traffic that optimizes traffic flow through the HOT lanes. If the lanes are congested and the traffic flow is sub-optimal, then the rates need to be raised until conditions improve. It’s called dynamic pricing.

3) Stench meter. There is no intrinsic reason that HOT lanes must be privatized. VDOT could introduce congestion pricing just as easily as a private company could. The advantage of public-private partnerships is that the private sector would invest a billion or more dollars of private capital into upgrading the Interstates, doing what the state cannot afford to do.

Fisher might argue that the state could afford to upgrade the Interstates itself if it just had more money. Why not raise taxes? Well, we could. Just two problems. First, you’d have to raise taxes a lot more than a billion dollars in order to generate a billion dollars for I-95 or I-495; state road revenues go through a complex distribution formula that makes it all but impossible to steer the money where it’s needed most. Second, just adding more lane-miles of Interstate doesn’t incentivize the kind of car pooling and van/bus riding that is essential to maximize the carrying capacity of the roads.

Finally, as far as the “fairness” factor is concerned, I find the issue wearisome. The reason people spend years earning college degrees, working hard and saving their money is so they can have more money than if they don’t. The advantage of having more money is that you can afford things you could not otherwise afford. You can ride in a Lexus instead of a Hyundai. You call up a satellite-navigation map on your touch-tone screen instead of unfolding a paper road map. You can put a double latte from Starbucks in your cup holder instead of a cup of joe from Quick-Stop. And you can pay tolls to whizz along in HOT lanes instead trduging bumper-to-bumper in the congested lanes. That’s the whole point of making more money! Otherwise we’d all jump out of the rat race!

(Hat tip to Tobias Jodter for passing along the story.)

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12 responses to “Fisher on HOT Lanes: Arguments Run Cold”

  1. Groveton Avatar

    Jim Bacon:

    I almost agree.

    HOT lanes are unfair? Probably. Life is unfair. I just don’t see a constitutionally guaranteed right to equal speeds of transportation.

    HOT lanes don’t work? At $42 per day round trip – they’ll work.

    Otherwise raise taxes? Not so sure about this. Maybe otherwise lower subsidies from NOVA to elsewhere. Elsewhere can decide whether to raise taxes or reduce services.

    And finally ….

    “…state road revenues go through a complex distribution formula that makes it all but impossible to steer the money where it’s needed most”.

    Why do you accept this?

    Why aren’t you calling for the heads of the entrenched politicians who perpetuate this absurdity?

    Is the allocation formula a law of men or a law of physics?

    Shouldn’t changing the allocation formula be a big, out front part of your position on the transportation debate?

    Maybe it is and I’m just not getting the message.

    Stop the Robbery.

    Dump the incumbents – regardless of party.

  2. Ray Hyde Avatar

    Even I thought Fishers arguments were weak. However, I think he has his finger on the pulse of the populace.

    Hot lanes are no more unfair than say, premium gated communities. What you are really paying all that money for is to exclude other people. But if any gated community got the kind of government support and advertizing that hot lanes are getting, there would be screams of anguish.

    Hot lanes won’t work. They will not reduce congestion, they will allow some to avoid the congestion that exists.

    Ideally, tolls would be set at a level that optimizes traffic flow. What hppens if that level won’t pay a return to the investor?

    It is going to stench. Besides, even if it is above board, where are those billions of dollars going to come from? In order to attract the dollars this will have to offer better return and lower risk than other options. Those other options might be, say mortgages, which would then have to compete with a government controlled monopoly for funds.

    If the state can’t afford to do this at low state interest rates, then why do we think the relative handfull of users can afford to do it, paying high interest rates and profit?

    Just because Fishers arguments were weak doesn’t mean that there are not better ones, or that hte arguments in favor of hot lanes are any better.

  3. Groveton Avatar

    I see the point on the political fallout from HOT lanes – ridiculous as it is.

    However, HOT lanes will serve one important purpose – they will institutionalize the idea of paying tolls for driving. First, maybe it’s the “fat cats” who pay $42 round trip. Then, it’s $42 round trip or $12 round trip (for a middle set of lanes) or free. Soon, everybody’s paying and nobody remembers how this came to be.

    “If the state can’t afford to do this at low state interest rates, …”.

    This has nothing to do with what the state can afford. The state can afford to do this. The state would just have to cut back in some other areas. By this same argument nobody should be able to build higher quality schools than that all powerful state. And we all know that’s bull. Even at the university level, the best public colleges rank out at about #20 in the country.

    The state of Virginia does virtually nothing well. It’s time to give somebody else a chance with transportation. Maybe the local governments, maybe private corporations. Just no more of what we’ve gotten from the state.

    Stop the Robbery. Throw out all incumbents – regardless of party.

  4. Anonymous Avatar

    “The reason people spend years earning college degrees, working hard and saving their money is so they can have more money than if they don’t………”

    How much more $$$ do you think people are willing/going to pay before they say enough is enough?

    I know of two college educated 30 somethings that were able to calculate what it cost them to commute to work and the conclusion they came to does not support your argument.

    They are willing to accept a lower paying job if means less of a commute both in terms of time and money. How many more of them are out there?

    There is only so much juice that can be squeezed….I agree w/ Groveton – throw them all out and start over.

  5. Tobias Jodter Avatar
    Tobias Jodter

    I do have a few questions about the HOT lanes if anyone knows.

    a) Will they be only a toll lane or both HOV and toll?

    b) Will the variation in pricing be based on the time cars enter the toll lane or will it be based on real-time numbers of vehicles using the HOT lanes?

    c) What is the ultimate purpose of the HOT lanes? Won’t moving cars into the HOT lanes relieve congestion on the other lanes and actually encourage more “free” commuting?

  6. Ray Hyde Avatar

    Whethter it is state money or private money, it has to be competed for in the equity market, wwhich means it won’t be available for something more valuable.

    If the goal is reducing wasted time, money, and fuel on travel, this is a loser on all three counts. If the goal is better settlement, then this is a loser.

    Almost anything would be a better way to spend the money than providing a government protected monopoly for a service that will be used by a relative few.

    I think the questions posed by Tobias are relevant. I have some more. If it is real time pricing, how do you know what the price is before you have to make a decision? If you pay for an uncongested trip, and don’t get it, do you get a refund?

    I also think anonymous is right. Some people are fed up. The FBI move, and other corporate moves to outer or less central areas is a recognition of what it takes to get people. What part of “FULL” or “Maximum Legal Occupancy” is it that we don’t understand?

    I was recently offered two equivalent and lucrative positions: one downtown, and one 25 miles closer. Which one will I take?

  7. Larry Gross Avatar
    Larry Gross

    “a) Will they be only a toll lane or both HOV and toll?”

    answer: you can USE the HOT lanes for FREE if you carpool.

    b) Will the variation in pricing be based on the time cars enter the toll lane or will it be based on real-time numbers of vehicles using the HOT lanes?

    answer: “real-time” traffic flow.

    The TOLL “adjusts” to the traffic flow.

    re: poor people who can’t pay

    here’s a thought. Would a low-wage person use HOT lanes to a low-paying job 30 miles from where they live?

    re: “we already pay our stinking taxes for roads – no tolls and no more taxes – build us some more roads with the taxes we already pay”

    Memo to WalMart: Institute a new program. Every customer gets to keep whatever they can put in a shopping basket for $50.

    Folks – we’re talking about a PILOT program that can and will be totally undone if it fails.

    Bonus question: what is YOUR plan for the future instead of HOT lanes?

  8. Ray Hyde Avatar

    answer: you can USE the HOT lanes for FREE if you carpool.

    Is that written in stone somewhere, or is it subject to the contract with the contractors?

    My plan is to give up on a problem that can’t be fixed. More roads won’t do it, orange line is jammed, VRE is SRO.

    Like I said, what part of FULL is it that we don’t understand? Go use up all that free road space in Farmville.

  9. Ray Hyde Avatar

    answer: “real-time” traffic flow.

    The TOLL “adjusts” to the traffic flow.

    OK. So Ienter the highway at 5:00 am when the toll is still low. When I’m halfway to work at 5:30 a hundred thousand people who live 20 miles closer stream onto the highway.

    Does my toll then jump from $10.00 for the first half of my trip to $20.00 for the secondhalf? If so, how do I know what I’m paying for?

    Pilot program my A__. Once those contractors spend their money we are stuck with it.

  10. Tobias Jodter Avatar
    Tobias Jodter

    What part of “FULL” or “Maximum Legal Occupancy” is it that we don’t understand?

    But yet for some reason “we” are all in favor of increasing legal and illegal immigration…

  11. Larry Gross Avatar
    Larry Gross

    re: HOT lane carpool specifics – initial and longer term.

    everything is on the table I suspect but since one of the fundamental GOALs of congestion reduction is to reduce the number of SOLO cars but, in fact, move more people.

    re: real-time TOLL.

    as before.. everything on the table and it probably depends on where the TOLL gantries are but it would not be in the interests of the operators to enrage users so I suspect efforts would be made to not introduce “gotcha” type charging.

    re: private vs public operation.

    Here’s the rub.

    VDOT not only has very little experience with HOT lanes but their whole philosophy is oriented to engineering infrastructure – not operating roadways for optimzed flows.

    Their stock answer has been always that the only way to solve congestion is to feed the beast with more infrastructure AND

    .. instituionally – they continue to not have a CUSTOMER orientation.

    over and over and over and over – (read the papers)… complaints will be given about some traffic light or intersection or whatever and the response comes back along the lines of “we’re aware of that” period.

    Imagine if you went into a Walmart and a counter had fallen into the aisle and stayed that way for hours and when management was asked about it – their response was “we’re aware of it”.

    So – you’d have to asked yourself in a HOT lanes scenario – if something was not working in a way that it adversely affected the folks paying for premium service – what VDOT’s probable response would be vs what a private operator’s response would be especially when it affected their financial bottom line.

    VDOT has no financial “bottom line”.

    They are not at all oriented to the idea that if they give better service, they get more money …

    or worse.. if they give poor service that it reduces their revenues.

    they just don’t operate that way and even though I’d allow that they could learn to … I still have my doubts.

    This is not a SLAM against VDOT per se. It just seems that most non-business … government entities tend to be not very customer focused and certainly not oriented to the concept of increased profit for good service.

  12. Ray Hyde Avatar

    Tobias: undoubtedly that is part of the problem.

    However, I submit that if every illegal alien disappeared tomorrow, we would still have traffic congestion. When I say full, I’m referring to an excess of jobs in too small an area.

    That will laways result in congestion. It is THE nexus between land use and transportation. Nothing else matters much.

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