Fuel taxes now costing more to collect than tolls - eTrans' Fleming at IBTTA

July 30, 2012

2012-07-30: When both are fully costed modern tolls now cost less to collect than fuel taxes according to a report for Reason by Daryl Fleming, a veteran toll industry consultant who works under the eTrans Group moniker. The full report is not yet available but Fleming gave a preview of its findings in a presentation at the IBTTA conference on all-electronic tolling (AET) in Atlanta.

With cash, toll collection costs have almost always been over 10 percent of revenues but AET has allowed some tollers to reduce toll collection costs below 5 percent of revenue, Fleming said. By contrast fuel taxes see costs of collection above 7%. Costs are much greater than 7% when account is taken of the congestion that goes with unpriced roads versus the congestion mitigation attainable through modern toll systems.

He gives figures for Fort Bend County Tollroad Authority of 12.5c/toll or 4.3% of a standardized $6 toll and Tampa Hillsboro Expressway Authority of 15.5c/toll or 4.1% as examples of what he calls "Best Industry Practice" in controlling collection costs.

Fuel taxes, Fleming asserts are simply "no longer competitive" with tolling once it is all-electronic.


The policy implications he says are that:

(1) tolling via AET needs to be recognized as a more cost-effective means for collecting revenue than motor fuel taxes

(2) user fees are also usually committed to a specific facility and less likely to be raided for other, non-highway purposes

(3) they are collected over a long period of time, providing stability and predictability to the revenue stream

(4) are more acceptable to the public because they can see where their money is going

Feds should butt out

As a matter of national policy the Feds should ease tolling restrictions on interstate highways now.

Fleming argues AET costs can be driven down further, through more efficient imaging, more competitive and consolidated back office processes, and cooperation across state lines.  More customer friendly and less of the 'police mentality' will help too, he claims.

The presentation credits colleagues Thomas L (Tom) McDaniel, Ramon L Grijalva, and Luis Alberto Sanchez-Ruiz.

The biggest benefits of modern tolling, Fleming says, come with the benefits of managing for free flow traffic.

Fleming and the others were involved in the first large all-electronic toll system in North America, the 407ETR in Toronto Canada and the 91 Express Lanes in California. They presently have work on the conversion to AET of toll systems in Puerto Rico and are advising on the dynamic toll lane/bus rapid transit lanes on PR22 west of San Juan. Other toll projects eTrans is involved in are the I-405 managed lanes in Seattle, and the Port Mann bridge proejct in vancouver BC.

see http://www.etransgroup.com/etrans/Welcome.html


TOLLROADSnews 2012-07-30

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