What’s a government to do?

I have been describing satellite (GPS)-based multi-function payment telematics that encompass road-tolling, parking metering and pay-as-you-drive insurance since 2003. First in patents filings, then at EU conferences then, starting in 2005 in the EU trade press, and in my blog (grushhour.com) since 2007 (this one is fun) and now in keynote speeches at transportation conferences and workshops in North America.

A reader recently asked: “How best can the government facilitate the development of private sector ‘multi-function payment telematics’?” A critical question, indeed.

The Government has two critical roles to play.

The first is to support standards in order to protect consumers, which in this case of road-use payment telematics encompasses users (drivers) and payment operators (toll operators, parking operators, insurance companies). This will include interoperability, communication interfaces, privacy, charging reliability, security, and evidentiary weight for non-repudiation. The International Standards Organization via its European partner, CEN, is addressing these standards now. Only one American regularly participates. More are needed.

The second is encourage voluntary use of telemetric devices for parking and insurance, ostensibly while waiting for policy and planning to be ready for GNSS-based road-tolling. One way this can be done is to encourage municipalities to permit programs for voluntary parking payment via GNSS meters. More detail on this, below.

Another way voluntary use can be encouraged is by permitting PAYD insurance programs in jurisdictions where legislation still lags, or by mandating that a gradually increasing percentage of insurance files be converted to PAYD. There are also a significant number of ways to meter and charge for PAYD insurance and the ones that use pay-by-use telematics are the most fair. These can be encouraged through subsidies to municipalities that partner with insurance companies to bundle parking and insurance on the same meter. The attraction here is that once a few thousand vehicles in a municipality or megaregion are equipped for parking, then an insurance company can offer PAYD premiums to those motorists without consideration for developing a telematics system, since it would already be in place.

Still another way to encourage use is to permit users of these new devices to pay existing RFID tolls on the same bill, since these systems can be set to identify the identical tolling amounts. Those highways for which the tolling authority is a government could consider a small discount, as further motivation.

Of course, if these municipalities and megaregions were to offer rewards of, say, parking-payment credits, to vehicles that did not move during peak hours, or were small, or were electric, or were driven very efficiently (hypermiling), or were driven less often, and if municipalities permitted local business improvement associations (BIAs) to offer loyalty rewards to frequent shoppers in the form of parking credits, this would further develop this new metering sector as it would reward users who subscribe to metering services.

So the short answer to the question “How best can the government facilitate the development of private sector ‘multi-function payment telematics’?” is simple to permit demand to be created by removing restrictions and encouraging the shift. Soon after would follow numerous competitors. Here is what some of them would look like.


Now to return to parking – by far my favorite congestion-related subject.

The advantages of satellite-based parking for a municipality are:
  1. Infrastructure costs are reduced which enables expansion of managed parking.
  2. Enforcement costs are reduced permitting the same parking officers to manage an expanded area of municipal parking.
  3. Citations for meter violations can be replaced with graduated pricing, reducing enforcement labor per parking spot, court backlogs and court services costs, while raising revenue and net revenue.
  4. The reduction of underpriced or unpriced parking reduces urban street congestion.

The advantages of satellite-based parking for a driver are:
  1. No need to pay each time you park.
  2. Pay only for the minutes used.
  3. Can overstay without ticket-anxiety.
  4. No parking tickets for expired meters.
  5. Expense management for business users (note that parking payments may be a business expense, while a parking citation is generally not).
  6. Able to purchase PAYD insurance (to save money).
  7. Able to pay existing (and new!) road-tolls with the same device.

The steps a municipal government must take to permit satellite-based parking:
  1. Permit one or more satellite-parking operators to meter and collect payment for your municipal parking spaces, lots and garages.
  2. Prepare pricemaps of the parking facilities. These are geographic locations (labeled polygons) with associated times and prices. Give these to the satellite-parking operator(s).
  3. Promote the service to your residents, especially to those receiving parking tickets, since those drivers generally find parking payment systems (which include payment of citations) to be bothersome. (Stick a service offer under the wiper with the ticket!)
  4. Do not ticket satellite-parking users for meter violations. Use graduated pricing instead. This should be set for the municipality to be able to encourage short-term parking to remain short, while appreciating the same net revenue as before.
  5. Offer a startup incentive such a credit on account for the first several hundred users.
  6. Design rewards for drivers to encourage both less driving and the use of satellite-based, in-car meters.
The advantage to Departments of Transportation is that voluntary adoption of road-use/parking-use meters permits governments to watch the technology develop and ascertain its reliability at very little risk, while users become accustomed to its fairness, convenience and privacy protection.

Everyone wins. No political suicide.


Here is an sample roadmap for a megaregion to introduce Pay-As-You-Go (PAYG) metering for a million or more vehicles. Click on image to enlarge.

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