E-ZPass recompete announced - the world's biggest toll systems procurement is on

March 19, 2008

It's on, at last. The Inter Agency Group for E-ZPass is recompeting the world's largest and most complex electronic toll system. Advertisements requesting proposals are being placed and the RFP documents will be available electronically from Monday March 24. The deadline for submission of proposals is July 18 2008.

The solicitation is formally by the Triborough Bridge and Tunnel Authority of New York (also known as MTA B&T), the largest grossing toll authority in the US and one of the founders of the IAG. All IAG contracts are executed by individual member agencies on behalf of the cooperative which by itself has no legal standing.

The advertisement being run tomorrow will say:

Triborough Bridge and Tunnel Authority (TBTA) is hereby soliciting proposals on behalf of the E-ZPass Interagency Group (IAG) to:

Furnish and Provide Electronic Toll Technology and Associated Subsystem Components and Services for the Operation of an E-ZPass System. The IAG includes Public Transportation Agencies/Authorities and Private Operators that offer Electronic Toll Collection (ETC) known as E-ZPass to their customers. The IAG currently has over 9 million account holders who utilize more than 16 million transponders operating E-ZPass for 23 Agencies in 12 States.

Solicitation No. 07-IAG-2782. Due Date: 07/18/2008 @ 3:30 PM. Sealed proposals must be received by B & T at the Bid Suite, 3 Stone Street, New York, NY 10004. The project description can be found at http://www.mta.info/bandt/procure/solit2.htm (click on solicitation number). NOTE: This page at B&T is not active as of Wednesday evening, but supposedly it will be up soon. TRnews 2008-03-19 midnight

IAG secretary Jim Crawford emails: "Please note that the document can only be obtained by completing the forms on the MTA B&T (officially the TBTA) web site. Document distribution will not begin until Monday, March 24, 2008. No hard copies of the RFP will be distributed."

Crawford says the RFP is for "the next generation of electronic toll collection."

The present E-ZPass technology goes back about 15 years and the present sole source supply contract began with the selection of Mark IV over Amtech, now TransCore, in 1995. Mark IV's original contract has been renegotiated several times since without going out for competitive bids.

Legal need to recompete

Crawford says the decision to open up the contract to new competition is "driven by the legal requirements of member agencies to competitively procure goods and services to ensure agencies are getting the best value and keeping pace with the latest technology."

Says Crawford: "The IAG's primary mission has always been to create and maintain compatibility between agencies, so that E-ZPass customers can continue to enjoy the convenience of electronic toll collection on all member facilities simply by establishing a single account with a single agency. The IAG's mission will remain the same, even as it considers new technology options."

"Customers are very satisfied with the overall product," he notes citing typical customer satisfaction levels in surveys of greater than 95%.

About two-thirds of two-thirds

E-ZPass members do about two-thirds of toll collection in the US. They add up to 23 toll authorities from 12 states with a total of 10m customer accounts and 17m E-ZPass group transponders in use. Members of E-ZPass include those use the E-ZPass brand name, but also those with their own distinctive brand including I-Paass in Illinois, I-Zoom in Indiana and Fast Lane in Massachusetts. Virginia's brand Smart Tag is progressively being retired in favor of the E-ZPass brand.

64% of the tolls of IAG members are collected by transponder.

Spectacular success

The program though not without its difficulties - ask Ed Gross former CEO of the New Jersey Turnpike Authority - has overall been a spectacular success. It has been popular with motorists beyond all expectation.

Interoperability has been made to work and a single transponder works throughout the network, though the one-to-one clearing of balances gets exponentially more cumbersome each time another toller joins the network. There is no central clearing house. Each toller sends all other tollers its 'white list' of accounts in good standing eveyr few days, and each toller individually clears balances with all the others. But so far it works.

When it was launched in 1995 the consensus was that in ten years E-ZPass usage might grow to 25% of total transactions, and that it would top out at about a third. There were debates about whether dedicated electronic lanes should be built in the center of toll plazas or on the right side. Many thought they should be on the outsides because that would be less divisive of regular toll plaza operations allowing reversible toll lanes and safe staff movement within what was seen as destined to remain the central toll collection facility.

At some toll plazas E-ZPass reached a third within two years and a half within five, and 65% to 70% within 10 years. Motorists love it because they don't need to assemble cash while driving and because it speeds them through toll plazas. Tollers love it because it reduces toll collection costs by something like two-thirds and because they can handle larger volumes of traffic without having to enlarge toll plazas. Their customers are happier and as a result toll increases are more acceptable.

E-ZPass has technically been among the best of the electronic toll systems with extremely high read rates. Transponder costs have been steadily driven down and improvements made in reliability and life of equipment while maintaining backwards compatibility - essential in a system used by a network of different tollers all of whose equipment has to work together. It has proven an adaptable system being used in many different situations including mixed mode stop and go traffic, roll-though, and the highway speed open road, point tolling and trip tolling with write-back.

Mark IV generally has a sterling reputation for dedicating itself to the needs of E-ZPass agencies. It has to because it sells little outside E-ZPass - a few to truckers for weigh station bypass and to small non-E-ZPass tollers as in South Carolina. To all intents and purposes it is a one customer company.

5.9 Gig

Mark IV's position has been that the best next generation technology is the 5.9GHz OmniAir transponder being developed with the support of USDOT for a wide range of vehicle-to-roadside (and even vehicle-to-vehicle) applications. Important decisions about 5.9 Gig, as it's called, are supposed to be made in the next year, the most critical will be whether leading car manufacturers will schedule its installation in factory made vehicles in say 2011 models as part of an ITS program called Vehicle Infrastructure Integration (VII).

Meanwhile they say the existing 915Mhz IAG transponder-reader system can be continued as the 'bridge' technology. Most of Mark IV's patents on the IAG system have expired, so at least in theory others could bid that model too.

Kapsch a leading European supplier has expressed an interest in 5.9 Gig and so has Raytheon. IBM will be making a pitch of some kind.

Sticker tags

The leading challenger to the status quo however is TransCore with its eGo sticker tags and dual mode readers. Will E-ZPass "go Florida" and embrace sticker tags as the brad and butter transponder while continuing to read the hardbodies?

Sticker tags are so cheap bought in quantity ($8.50 in Florida) that they can be given away. $20+ hardbodies are too expensive for that. The sticker tags have another attraction to tollers. Since they use the energy of the incoming radio signal from the overhead reader to respond, they need no battery. The hardbodies with their batteries have improved in reliability and life over the 12 years of the IAG E-ZPass Mark IV technology. Most of them last the five or six years that motorists typically own a car.

But even so end-of-battery-life problems are numerous enough will millions out there to generate considerable costs and angst. Transponder problems have to detected, customers notified and persuaded to return the dud, a new one has to be dispatched and to be fixed to the windshield by the customer.

A number of IAG members think they should have the option to supply sticker tags. In an interoperable system however if one sticker tag is to be accepted every toll point in the network has to have the dual mode reader with the capability to read it, so it's not an easy decision. There are over 2,000 readers and the switchover to dual mode readers has to cost around $10k/lane.

Video tolling

What role for video tolling is another issue. Under present E-ZPass arrangements video tolling is violation enforcement plus a backup for misreads of transponders. In the freer environment of Texas and Florida where rental cars and fleets are now being tolled entirely by 'video' - cameras and automatic license plate recognition.


For area pricing the use of smarter units that tap into satellite and cell phone location finding make more sense than roadside heavy traditional tollroad systems. Siemens and Skymeter may make pitches with those.

How to accommodate that possibility may arise as an issue.

The E-ZPass recompete is such a huge and important procurement almost everyone in the toll business is likely to be in the competition somewhere because there will be a variety of teams.


The current members of the IAG are:
- Maine Turnpike Authority
- New Hampshire DOT
- Massachusetts Turnpike Authority
- New York State Thruway Authority
- New York State Bridge Authority (upper Hudson River crossings)
- Port Authority of New York and New Jersey (Hudson River and Staten Island crossings)
- Metropolitan Transportation Authority (or Triborough) Bridges and Tunnels
- New Jersey Turnpike Authority
- South Jersey Transportation Authority (Atlantic City Expressway)
- Pennsylvania Turnpike Commission
- Delaware River Joint Toll Bridge Commission (PA-NJ bridges)
- Delaware River Port Authority (Philadelphia Delaware River crossings)
- Delaware River and Bay Authority (Delaware Memorial Bridge)
- Delaware DOT
- Maryland Transportation Authority
- Virginia DOT (on behalf of four public and private tollers as well as VDOT's)
- Illinois State Toll Highway Authority
- Indiana Toll Road Concession Company
- Massachusetts Port Authority (Tobin Bridge)
- West Virginia Parkway Economic Development Authority (the WV Turnpike)
- Buffalo and Fort Erie Public Bridge Authority (Peace Bridge NY-Ontario)
- Burlington County Bridge Commission (NJ-PA bridges Delaware River between Philadelphia and Trenton)
- Chicago Skyway Concession Company

The Ohio Turnpike Commission will join IAG this year. North Carolina Turnpike Authority - located in a kind of limboland between southern toll systems and E-ZPass has to make a decision shortly which way to go or whether there is some compromise accommodating a degree of interoperability with both.

TOLLROADSnews 2008-03-19

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