E-ZPass innovations drive transponder use over 80% at MTA Bridges & Tunnels, 87% at plaza to go AET

August 6, 2012

2012-08-05: MTA Bridges & Tunnels (MTAB&T) in New York City, America's largest toller in revenue ($1.5b)  has been quite successful driving up transponder usage in preparation for going all-electronic - with a program of thoroughly understanding their customers and introducing new convenient new ways of paying transponder tolls, as well as providing $-incentives.

Of 285 million toll transactions they do each year about 230 million or 81 percent are now E-ZPass versus 76% two years ago. At the Kennedy bridge in the Bronx, the crossing with a lower income and minorities' concentration, E-ZPass market share has grown from 59% to 69% in two years.

These numbers come from a presentation by Dan Jacobs, director planning & analysis at MTAB&T at the IBTTA conference on all electronic tolling (AET) in Atlanta recently.  MTAB&T will take its Henry Hudson Bridge all-electronic in a few months time.

That's the bridge at the far northern tip of Manhattan Island that links to the Riverdale section of the Bronx and to Westchester County via the Saw Mill Parkway. (see map below)

There is no firm schedule for taking the eight other MTAB&T crossings cashless but the potential savings in operating costs and improved service make them likely to follow within two to five years.

Jacobs emphasized the transponder as a much cheaper and highly reliable toll collection method compared with license plate imaging, department of motor vehicle lookup and mailing of a toll bill. So a major objective of MTAB&T, he said, is to convert most of the cash customers to E-ZPass, while persuading existing transponder users to keep their E-ZPass.

This will meet customer needs better while "laying the ground" for AET.

Focus groups and other research among MTAB&T cash payers showed six barriers to adoption of a transponder account among cash customers:

1. 61% want "control over my cash flow"

2. 57% dislike automatic deductions

3. 50% say the minimum downpayment for a transponder account is too high

4. 49% object to prepayment of tolls under a regular E-ZPass account

5. 48% say they don't travel the toll facilities often enough to make E-ZPass worthwhile

6. 46% are concerned they may overspend on tolls with a transponder

Something of a surprise to MTAB&T, Jacobs said, was the number of cash customers who had had an E-ZPass transponder but had stopped using it - 23%.

They had a whole variety of reasons for dropping transponder use from difficulties with their credit card, cash flow problems, billing issues through to needing receipts for reimbursement for business travel.  (Almost none cited privacy or any preference for cash as such.)

The first initiative was E-ZPass On-the-Go, a prepaid transponder (tag) in a pack sold for $30, $10 a deposit on the transponder, $20 for toll credits. 175,000 have been sold to date out of some 575 locations.

E-ZPass On-the-Go

Once the tag has been used for the first time, the customer has 48 hours to register the tag at www.ezpassny.com or calling a toll free number on the tag.

If the tag is registered to an account that is replenished automatically by a bank card, the $10 deposit also becomes a toll credit. If the tag is registered to an account to be replenished by check or cash, then the $10 remains a deposit for the tag.

Cash lane sales

June 27 2011 MTAB&T started having toll collectors sell E-ZPass On-the-Go packs in cash toll lanes.

At first sales were just at the Henry Hudson but in March and April this year they were expanded to all nine crossings' toll plazas.

Nearly 65,000 were sold by toll collectors by the first anniversary end-June this year and as of more recent data 76,000 have now been sold.

Spanish language service

A second innovation is Spanish language service with a Spanish website, Spanish IVR prompts and customer service reps.

Cash Reload Card

Third is an E-Pass Reload Card launched February 21 2012 with paid radio and online ads starting end April. It uses the Visa ReadyLink network of which there are several thousand locations around New York City and 50,000 nationwide.  

Thousands of 'preferred locations' have been negotiated with a set $2 fee, 400 of them in New York City. (CORRECTION)

24,000 of the magstripe cards have been issued as of mid-July. Reloads are quite modest in number - about a hundred a day but increasing. Something of a surprise, Jacobs says, the average replenishment is $60, quite a bit more than they expected.

At the time of reload about a quarter have a negative balance, three quarters still have a credit.

The Henry Hudson Bridge toll plaza now does 87.5% E-ZPass transponder transactions.

The Marine Parkway and Brooklyn Battery and Queens Midtown Tunnels are at 85% E-ZPass.

The Verrazano Narrows Bridge is at 82%, and Throgs Neck Bridge at 80%.

Per-trip account

To be rolled out late this year is a Pay-per-Trip E-ZPass account, details of which aren't yet available.

Major incentive for getting a transponder of course has the toll differential in its favor - at the major crossings the E-ZPass toll is $4.80 versus $6.50 for cash, a $1.70 difference, a 35% premium for cash or a 26% discount for the transponder toll, whichever way you care to look at it. These tolls became effective December 30 2010.

For big trucks the differentials are even larger. At the major crossings a 5-axle tractor trailer pays $23.63 with E-ZPass, $35.00 cash - an $11.37 difference, a 48% cash premium or a 32% E-ZPass transponder discount on cash.

see FOLLOW-UP2 below





FOLLOW-UP: a spokesman says MTAB&T have never done any assessment of minority status. Their analysis was entirely based on income.

Parochial protectionism

FOLLOW-UP2: a reader points out that the E-ZPass toll rates above apply exclusively to New York registered E-ZPass accounts and that E-ZPass drivers with accounts in NJ, PA, MA or anywhere outside New York state pay the full cash rate.

MTAB&T is by no means the only toller to give only local E-ZPass subscribers the 'E-ZPass Discounts' but the E-ZPass Group needs to come to grips with the damaging effect of this parochial protectionism in blunting incentives to use E-ZPass and the unfairness of unequal treatment of similar vehicles and accounts.

TOLLROADSnews 2012-08-05 FOLLOW-up2 Aug 9 06:36

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