Maybe it is good that neither the US nor Canada can fix the fuel tax

I write here a lot about the need to shift from fuel-tax to a pay-as-you go road-use fees. A lot of people write about this.  Recently Jack Opiola wrote some more in ITSI (“Evidence buildingfor distance-based charging”). 

Opiola’s point is that we could increase acceptability by giving drivers 2 or 3 choices of methods to pay for road use rather than encourage hostility by mandating a single technology, namely GPS. He goes one further by saying: “the market place would supply the necessary technology and data collection services, certified to ensure the system works consistently. …the Government could contract the tax collection function to private companies, with competition driving down administrative costs. Government would provide oversight and certification of private sector providers to ensure fairness.”

On the way to the explanation, he points out a few things worth thinking through. I cherry-pick a few:
“Last month the (US) federal government announced a sizeable increase in the corporate average fuel economy (CAFE) standards for new vehicles, bumping the required average of 35.5 miles per gallon in 2016 to 54.5 miles per gallon by 2025. …this policy will have a devastating impact on highway funding if US Congress does not take corresponding action to identify revenue not based on fuel consumption.”

“…some cars on our streets already contain much of the technology to meet the new CAFE standards. Fuel efficiencies of many hybrid electric vehicles are approaching 50 miles per gallon and steadily raising the fleet averages. Now entering the marketplace are fully electric and plug-in style hybrids - Nissan's LEAF and Chevrolet's Volt, among others. Every major automobile manufacturer is preparing at least one electric, plug-in hybrid, or advanced hybrid model for market entry in the next two to three years.”

“These vehicles, capable of nearing or exceeding the calculated equivalent of 100 miles per gallon, will generate little fuel tax. It is estimated the entire fleet will need about 40% of the fuel it currently consumes, reducing tax revenue by about two-thirds.”

Increasing the fuel tax “would create an ever-widening inequity between owners of highly fuel efficient vehicles and those [that] pay a far heavier burden by continuing to operate conventional cars.”

“Alternative funding sources must be found to maintain the health of highway systems… Policymakers have considered replacements for the fuel tax, such as sales taxes, registration fee increases, personal or real property taxes, income tax, value-added tax, tolling high capacity highways, taxes on oil company profits and others.”

“But each shifts the burden of paying for the roads from one type of user to another or to non-users. In almost all of these cases, the proposed alternatives are less equitable than the current system.”

“The fuel tax is based on use, but its consumption linked formula is woefully out of date and not correctable.”

“Since two congressional commissions on transportation funding endorsed VMT as the most viable alternative to the fuel tax in 2008 and 2009, the US has done little to advance the discussions.”

The net of this is that in the next few years the structure of road-use funding via fuel taxation will remain unchanged and this will boost sales of alternative (non-fossil) vehicles, whereas shifting from fuel-tax to road-use fees now would dampen those sales. This is one case where government inability to act may have a partially-positive outcome. Although, Oregon might prove an exception.

Perhaps we should shelve the discussions about VMT tax and Mileage-based User Fees for a few more years. Technology will soon drain so much revenue from our highways and roads that a future government will have little choice, anyway.


Spying on your life or saving your life?

Over in AutoSavant you can enjoy a dose of scare mongering about a device to meter driver behavior for PAYD insurance.  Any device that monitors, views, films, captures, measures, listens, collects, or sniffs data about anything humans do seems to be fodder for phobic journalism and paranoid commenters. PAYD insurance indeed has privacy issues.  But they are addressable.
The real reason for PAYD insurance is to distribute risk more fairly for drivers and more manageably for insurance companies (right now your zip code is used (among other things) to help assess your risk profile). In addition to tentatively threatening privacy and increasing affordability for more than 50% of drivers, PAYD insurance also enhances safety, and reduces vehicle miles traveled (VMT).
Unfortunately, instead of discussing privacy, cost, safety and VMT in a balanced fashion (which I would say should be about 5%, 25%, 50% and 20% respectively, this journalist weighed these four matters at 90%, 10%, 0% and 0%. This is to do a huge disservice to his readers.
When I read the article there were 39 comments. 54% were against the PAYD device (stoked by the writers privacy fears), 28% were for the device for reasons of fairness, safety or cost savings and 18% were neutral or incoherent. Statistically speaking, these 39 commenters are somewhat smarter than the journalist (usually only extreme opinions show up in these open forums).
Technology has been extending average life spans for many hundreds of years. Medical advances (e.g., near-mandatory vaccination programs) come to mind. Not long ago, seat belts were considered an invasion of privacy, now a majority of us put them on without thinking about it. Tonight I was stopped in a mandatory alcohol check-point. I was asked if had anything to drink this night. Was that an unfair imposition on me? (I drink a glass of wine once a month and had none this night.) I have been twice sniffed by narcotics detection dogs while in airports.  Another privacy invasion?
Driving safer saves lives. About half of the victims of road accidents were driving comparatively safely. Progressive's program may save opt-ins a couple hundred dollars, and it also saves lives. Anyone with a family member killed by another driver would applaud this form of insurance; many with a family member who has killed someone in an accident might also consider this a good idea. 15 years ago I had a brother-in-law who took his own life a few weeks after killing someone in an auto accident.
Compare how many Americans have been entrapped in a legal matter unrelated to road use with evidence provided by tolling data or automotive insurance data vs how many innocent Americans are disabled or dead because of automobile accidents.
A similar product to Progressive’s, available in Australia, (betterdriver dot com dot au) promises to save teen lives. Here the party watching is the teen’s parents. Big Daddy if not Big Brother. Fewer complaints, it seems, because they are our kids.
The key issue is NOT the metering of driving behaviour, it is the USE of that data. There must be strong, and strongly upheld, legislation that this data only be used for the purpose of fair insurance pricing and safety. The readers who comment: “you are being monitored” may be right, but it is not the monitoring that is harmful, it is the potential for abuse. We need to address the potential for abuse, rather than reject a powerful tool for automotive safely.


Fuel Tax vs Property Tax

Why do we to pay two taxes for roads?

One of the most common objections to VMT charging or mileage-based user fees is “I already pay (for roads) with fuel taxes”. While I have heard or read this many hundreds of times, I have never heard anyone complain, “I already pay (for roads) with property taxes.”

It is interesting that we are so very sensitive to (or aware of?) of fuel tax, but not so much to property tax. And why do we pay two taxes for our roads, anyway?

A 2009 article from Access Magazine explains this neatly.
Early in the 20th century most US “…cities had the technical and financial means to widen their streets, install traffic signals, and carry out other operational fixes. But they lacked the means to shoehorn extensive freeway systems into dense urban areas. One problem was that the tax instruments available to local governments were not appropriate for the task. Local governments had the authority to levy taxes and special assessments on property and businesses, but not, for example, on fuel. The property tax is a sensible mechanism for financing local streets and roads, because these streets link individual land parcels to the world and help give them value. It is thus logical for property owners to help pay for local street construction. Freeways, however, affect the value of property across the entire metropolitan area, not just of nearby parcels. This makes it hard to justify special assessments on freeway-adjacent properties, since the majority of a freeway’s benefits accrue to travelers and landowners over much larger areas. (Indeed, being too close to a freeway can lower land values, particularly for residential property.) … A potential solution to these problems emerged in the 1920s with the development of the gas tax. As a way to finance freeways, gas taxes had much to recommend them: they placed the tax burden on users of the system, they were relatively easy to administer and collect, and they were robust. Property tax revenues nationwide plummeted 72 percent during the Depression years of 1930 to 1939, but fuel consumption and its associated tax revenues proved surprisingly resilient. Except for a small dip at the beginning of the Depression, fuel consumption rose every year until World War II (emphasis mine).
So a fuel tax was indeed a valuable innovation 100 years ago. It would remain a valuable innovation if the purchasing power of fuel tax were consistent with the needs of building and maintaining roads. But it is not. As fuel economy improves, as the purchasing power of the road building and maintenance dollar shrinks, and as we refuse to increase the fuel tax, its efficacy continues to wane. And that is only half the problem with the fuel tax. It also does not respond to congestion.

And while the property tax is also insensitive to congestion as a pricing signal, its correlation with road use is even more tenuous than is the fuel tax. This makes it less fair than fuel tax—since a young renter who contributes to her landlord's property tax payment and who does not use a car overpays for road use.

So we have two taxes that are ineffective in managing demand, one of which we cannot adjust and the other of which we seem to have minimal awareness of. While mileage-based user fees could solve both problems given the right policy design, we seem particularly attached to a status quo that is unable to give us the roads we need, and that increases congestion.

Our attachment to a tax structure that is keeping in place a very serious problem for both inter-urban and intra-urban mobility is critically bankrupt and a huge barrier to solving congestion and its attendant ills.


Collaborative Telemetrics

If Rachel Botsman and Roo Rogers are right in their recent book “What’s Mine is Yours: The Rise of Collaborative Consumption”, we can expect a rise in peer-to-peer car sharing.  P2P car sharing turns any owner of an automobile into a single-car car-rental company, with reservation services provided online. Right now one of the US operators, RelayRides out of Cambridge Mass, installs technology to lock and unlock the vehicle using a near field communication card that the renter-member keeps in her purse meaning that key-exchange does not require owner attention. That’s a start.

Traditional car-share operations such as ZipCar, lower automobile ownership, reduce demand for parking space, reduce automotive miles traveled, and likely reduce traffic congestion in peak times. P2P car sharing offers all these things—and more. VMT supply can be increased dramatically without investing in more vehicles, car owners can have their neighbors make their car payments for them, it can make a greater variety of vehicle sizes and types available to a car share renter, and the vehicle storage depot problem mostly goes away.

While traditional car sharing has economic incentives for people who only need occasional access to a vehicle, P2P carsharing has economic incentives for car owners. This is disruptive, making it something to watch. 

Wikipedia lists 13 P2P car share operators world-wide—with the 1st launch in Germany in 2001. Half of these launched or are launching in 2011. Tellingly, one of the founders of ZipCar, Robin Chase, is also the founder of Buzzcar a P2P service in France. I predict 100s of these will be set up in as many cities and only after we figure out how to do it will the market pick a handful of winners.

The key to P2P carsharing work is trust. You need to trust that my car will be clean, safe and operational and I need to trust that you will respect my property. Trusting strangers from whom you might buy something is well-managed with online purchasing from auction sites like eBay or the used book jobbers that trade on Amazon. If you rent your car online—as you would if you were a car owner in a P2P car-share transaction—your reputation (well, your car's reputation) will be gleaned from your users by the site that manages the transaction. But what about the renter's reputation? After all, you will not want your car to be subject to automatic speeding or red-light tickets and parking fines. How will you know if a renter abuses your accelerator or clutch?

There's other things such as insurance and perhaps wanting a different rate from someone who uses your car for two hours to drive a hundred highway miles vs someone using the same two hours to drive just couple of miles to visit his auntie.

Telemetrics systems can address all of this. An in-car meter that measures speed, braking, steering could automatically establish a driver’s reputation for the car owner. While there is no need to track the driver, “driver-style can be calculated as a reputation factor and the car owner can decline or accept further rental requests based on that reputation. While we are at it, the same meter can manage distance traveled, usage-based insurance, even parking payment, bridge or tunnel tolls, and so on.

What is now possible is for P2P car share operators to equip a member’s vehicle with a meter sufficient to calculate the entire trip cost on an equitable usage basis for automatic billing and permit the car owner to select driver style thresholds, so that she need not be concerned with any of these matters.

Collaborative Telemetrics could make P2P carsharing the “Killer App” of 21st century automobility.


Fair to the poor

The Greater Toronto Area has experienced a noticeable increase in all-day conferences and hefty consulting reports about road pricing and infrastructure funding. A decade ago it was once every few years. Now it’s monthly. Each of these conferences and reports carry the same message–our transportation infrastructure is inadequate, crowded and crumbling. And our purse is empty. While this is true of large cities more often than not, Toronto has it worse than many—Toronto’s population is growing especially rapidly and we have not invested at the rate we should have over the past quarter century.

Reaching Top Speed, a June 2011 report from the Toronto Board of Trade points out that the full bill to refurbish and operate transportation infrastructure in the GTA over the next 25 years—$100 billion, before overruns—is a figure 22% greater than the combined cost of the Big Dig, the Chunnel and the Three Gorges Dam.

This same report identified several “funding tools” the top five of which were road pricing, congestion pricing, fuel tax, regional sales tax, and parking surcharges. These lean heavily toward fees on automotive use, although the rebuild is heavily transit oriented. The report suggests that these could raise $1 billion per year–or about half of the capital expense required for the 25-year plan.

There are important differences among the five tools listed. The most effective for managing gridlock is congestion pricing; the least effective is the sales tax. Congestion pricing is politically the most incendiary; the least is likely sales taxes or parking surcharges. But the touchiest subject is fairness. Among these, congestion or road pricing is often said to be unfair to lower income families.  But is road pricing worse than a sales tax for poorer families?

This problem was looked at recently by Lisa Schweitzer fromUSC and Brian Taylor from UCLA (Access, Spring 2011), albeit in the context of pure road funding. As we choose amongst funding tools, we should weigh their observations.

As a funding mechanism, sales taxes are collected pennies at a time and hidden in many transactions making it virtually impossible to see what one is paying for roads. Sales taxes make the poorest households worse off since the people in these households are paying something while driving little—certainly much less than people from richer households. This makes increasing regional sales taxes to fund roads doubly regressive.

Road use fees, which can be made fully transparent, take money from only those that use the roads, i.e., mostly middle- and higher-income families. Schweitzer and Taylor find that switching from tolls to sales taxes shifts the burden from users to non-users and away from middle-income people onto both the rich and the poor–i.e., road tolls are better than sales taxes for the lowest-income families (although they increase pre-existing access barriers).

How any of us pay for good urban transportation is a very complex social issue—hence the burgeoning industry in conferences and consultant reports, and the dearth of workable solutions.


Toronto’s same old road-pricing script

(updated 2011.06.08)
The past 12 days have produced a noisy buzz of articles in the Toronto Star regarding the need to use road-pricing of one sort or another to raise capital for GTHA transportation needs and to quell congestion. The basic script for the discourse this past week is identical to the script playing in every city and every country for the past 15 years (this week's example from Oz!):

Experts: “We need road-pricing!”
Drivers: “ We don’t want it!”
Politicians: “And we won’t do it!”
Journalists: “There is no solution, the sky is falling!”

One exception to the above script is a Star editorial, presumably written by a journalist, that says: “We have no choice but to use road pricing, so get over it.” The Star is half right—the no choice part is correct. But we are not simply going to “just get over it”. 

It turns out the Experts are correct—we must deploy tolling. The Drivers are right—they really don’t want tolling. And the Politicians are telling the truth (this time)—they won’t do it.  The only ones who are wrong are the journalists—because there is a solution.

That solution involves the voluntary selection of services, privileges, rewards and discounts in exchange for behavioral changes. Think of an analogy to the Airmiles™ system, but far, far richer. This approach, already tried and proven viable in France, Holland and the United States (among others), can be accomplished using automated, self-enforcing, privacy-assured, in-car road-use meters. It is possible, given current telemetric technologies to measure where and when a vehicle is driven or parked and to calculate, using a secure on-board database, rewards and discounts based on behaviors such as eco-driving, reduction in car-use, avoidance of peak hours, use of smaller vehicles, avoidance of congested routes, etc.  Rewards can include parking cash-outs, or transit passes.  Parking discounts or transit passes can be provided for not moving a vehicle during peak times or in congested areas or for using an alternative vehicle. Services include traveler services and pay-as-you-drive insurance that can save drivers money while reducing congestion. Privileges can include a guarantee of no parking tickets, graduated parking access to HOT lanes, fuel-tax rebates in exchange for road-pricing and parking spot reservation via a related parking finder.

It is possible to reward drivers based on comparative behavior.  If the monthly aggregate driving behavior of several thousand drivers were established, drivers in the upper deciles could be rewarded (automatically, without disclosure of location) via discounts to their service accounts.  There are literally hundreds of easy ideas such as this that a road-use metering system can automate. If a couple dozen were made available, there would be “something for everyone”. Some drivers would in fact save money, rather than pay more, as most journalists assume.

Such a system would be operated by private industry, bolstered by distributing consumer rewards from urban retailers seeking business, regulated by government to ensure equitableness, privacy and access, and (eventually) would permit switching from fuel tax to road-use fees.

A study by RAND (October 2010) described this (section 6.2.3), and NYCDOT currently has a RFEI asking private industry how they might set this up.

So it is possible. And it will be done. And it can start soon—this year, if someone wanted to. It just won’t be done by government mandate... 

Hepburn: Ford is right, toll roads are nuts
Bob Hepburn June 08, 2011. Tolls and congestion fees mere cash grabs on motorists with no realistic option except to drive to work.

Pros and cons of road tolls
June 08, 2011. Denial on tolls needs to end, Editorial, June 4

Cohn: Legislature united against road tolls and carbon taxes
Martin Regg Cohn June 08, 2011. Remember the environment? In Ontario, pollution has slipped from mainstream to slipstream.

Editorial: Denial on road tolls needs to end 
June 04, 2011. Two authorities — one provincial and the other working for Toronto — agree road tolls are needed to pay for key public transit projects. 

GTA needs gas hikes, road tolls, congestion charges to fund transit: Experts 
Brett Popplewell June 04, 2011. Add all these charges and this city might solve the gridlock that has Toronto moving more slowly than almost any other city in the Western world. 

Oslo does it, Stockholm does it, London does it 
Brett Popplewell June 04, 2011. Congestion charging and tolled highways are inevitable for Toronto, according to Harry Kitchen, a professor of economics at Trent University. It’s just a matter of the public and the politicians accepting the reality that this city, in its current state, is grinding to a halt. Why? Because roadways are jammed... 

65% of Torontonians say no to road tolls; 72% want bike lanes 
David Rider June 03, 2011. Torontonians strongly oppose the idea of road tolls to pay for Mayor Rob Ford’s promised Sheppard subway line, says a new opinion poll. 

Road tolls worth considering 
May 31, 2011. Road toll ‘reality check’ stirs up Toronto council, May 28 

Watchdog recommends road tolls to reduce traffic, pollution 
May 31, 2011. Ontario’s environmental watchdog is recommending a “serious discussion” be held on road tolls to lessen traffic and reduce greenhouse gases. 

Go with road tolls, Environment Commissioner tells GTA 
Richard J. Brennan May 31, 2011. Ontario Environment Commissioner Gord Miller is pushing for more toll roads in the Greater Toronto and Hamilton area to reduce single-passenger traffic. 

Mayor Ford won’t support tolls to fund Sheppard extension 
Daniel Dale and Paul Moloney May 30, 2011. Doug Ford, the mayor’s brother and trusted adviser, said emphatically that “road tolls are not going to happen.” 

James: Sheppard subway? Not now, maybe not ever 
Royson James May 30, 2011. The Sheppard subway extension is a lost cause as NIMBY residents, council opposition and high cost conspire to kill the plan. 

Road toll ‘reality check’ stirs up Toronto council 
Madhavi Acharya-Tom Yew May 28, 2011 

James: Ford’s subways will require tolls and grants 
Royson James May 28, 2011. It will likely take new road tolls and congestion charges and other revenue tools to help deliver “the biggest transit deal in North America, or perhaps the world,” says the man hired to pave the path toward the $4 billion Sheppard Subway. An exclusive report by the Star finds that new road tolls and congestion charges will be needed to deliver the $4B Sheppard subway.


Fork in the Road

By now you know that prices for carbon-based fuels will continue to go up more frequently and more aggressively than they will be coming down. You already appreciate that this makes the extraction of costlier and dirtier carbon fuels more likely—fuels like oil from tar sands, coal, and natural gas from fracking. Likely you also appreciate that since these fuels can only increase in costs, this is what has been making innovations in alternative vehicles and fuels more attractive for innovators and investors.

This means there are two competing ways out of the corner into which we are painted. One will impose changes in modal choices and on how and where we build and live. The other, on the kinds of cars we drive and energy we use. Hence we will soon arrive at a societal decision point that I am arbitrarily targeting for 2020, alluding to useful puns on “good vision” and “hindsight”. This is also far enough away that my predictions will be forgotten giving me some freedom from fear of retribution for my heresy.

I propose that we think about this 2020 decision point as a fork in the road called “Cars-as-we-now-know-them”. I propose that at this fork, we have two fundamental choices. Toward the Right, we have the “New Automobility”—alternate forms of energy for mobility. Regardless of whether this is biofuels, electricity, compressed air or fuel cells, motive force will increasingly originate from renewables such as solar, wind and a dozen other ways to trap the sun. This route will make cars, energy, and mobility greener, cheaper and more plentiful. We will have more cars and generate more VMT. Congestion will threaten every last spare minute, and we will have a devil of a problem to fund infrastructure. The more of us that take the Right branch, the greater our societal evolution—and the more we will need road pricing.

Toward the Left, we have the “New Modalities”—we will change our modal mix to tons more of carpooling, vanpooling, transit, biking, walking, telework and moving toward the center of dense cities. This route means changes in transit and urban livability and in health, settlement density and planning. The more of us that take the Left branch, the greater our societal revolution—and the more we will need road pricing.

I have traveled both branches of this fork in my thinking over the past nine years, first the Left branch, then the Right. That is in the permanent record. Good people line both branches. We will not make uniform choices, but perhaps we can make informed ones. The question now is: “which approach will dominate the final numbers?”

Will we turn 50% toward New Modalities and 50% toward New Automobility? Or will it be 10:1 in favor of one or the other? The evidence, I argue is in favor of the New Automobility—simply because it is the path of least resistance.  Rather than moralize, just look at the mathematical imperatives of entitlement, habit, culture, innovation, investment, desire, fear and inertia. To set these things aside in favor of pure and correct systems thinking makes us worse than blinkered.

We need to explore both branches, dark or light, of the fork we are arriving at.  At least as we start making these choices in the coming years, someone will have thought about their consequences. In the end, thoughtful solutions are all that can win the future back for us (or not).


Millions of Dollars in Free Parking

I live on the east side of Toronto, a dozen blocks from the Greenwood subway entrance. Last Friday, I wanted to lunch with a friend at Islington and Bloor. To take my car would cost me about $8.00 in gas, lease, and wear. Rather than drive, it made sense to park my car a block or two away from the Greenwood station and use the subway. It would be at least as fast (it was midday), it would be cheaper given Gaddafi gas prices, I would get a couple of blocks of exercise, and I could read a book about traffic congestion (a personal obsession) on the train.

Four superb and completely selfish reasons.

Pleased with my plan, I drove off. When I got near the Greenwood station, the nearest street was marked one-hour parking. Made sense — can’t have tons of folks like me crowding out these local residents. I went North to the next street. One-hour parking. And the next one, too. So I went up one more and finally ended up parking four blocks north of the Coxwell station in the wrong direction. I had in essence “cruised” an extra 1.5 km looking for free parking while passing well over 100 empty one-hour spaces — I figured I needed three hours in total and did not wish to risk a $30 ticket.

These one-hour spaces, on all the residential streets three or four blocks on either side of our subway lines—and around other major facilities that are either poorly or expensively served by parking lots (the East Toronto hospital is one example)—form radii of parking spaces constrained to one-hour parking to prevent abuse. Makes sense. Or does it?

The great majority of these one-hour spaces remain empty after the residents leave for work and until they return home. If left unmanaged, they would be filled by freeloaders— such as me—who would leave their car in front of a stranger’s house and take public transportation to save $10 or $20 in downtown parking fees. One can argue that having people who live a couple of kilometers from a subway station use one of these residential areas and take subway rather than drive downtown (I know many who do this) would do three things: (1) reduce vehicle kilometers traveled for all such commute trips; (2) put more riders on the subway; and (3) raise revenue to help maintain the streets and sidewalks of those residential areas—thereby reducing the property-tax demand for those residents.

I would have been happy to pay $.50 or $.75 an hour for a spot a block away from Greenwood—more if the weather was crappy. The city has an opportunity here, to manage those spaces for the benefit of the residents living there, and for the benefit of Torontonians who live less close to the subway. Benefits include: increased transit use, lower emissions, less congestion, saving money for drivers, reducing property tax demands for the residents affected. The only losers in this are the downtown parking garages. But if the scheme I am about to describe were operated by Toronto Parking Authority’s GreenP, then the TPA would not need to lose a nickel.

How to do it
In order to execute such a scheme, participating vehicles must be self-metered and self-enforced. The reason is the city can ill afford to add new curbside parking meters or new signage , or a new army of parking enforcement officers. As it is now, these one-hour parking areas must be visited twice to apply tire-marking enforcement methods—a very expensive matter—which leads to a strategy of occasional spot-enforcement anyway (I get ticketed maybe once in ten for violating these restrictions).

Such self-managed meters already exist. Using a new technology called financial-grade GPS, they use a completely private method of determining the correct parking fee based on an internal parking “price-map”. Each meter is unique to a participating vehicle, pays parking monthly either on a debit or credit bases and never reveals the location of the vehicle to any party other than the driver. (There is a 100% driver-private way for the parking operator to audit the system—no person can get to know where a spouse is parked since location data does not leave the vehicle).

So a commuter who wished to park in one of these areas would affix a meter, which is the size of smartphone, on her windshield behind the rearview mirror. A small indicator lamp shows that the meter is working so that a parking enforcement officer can safely ignore any legally parked vehicle (blocking driveways and fire-hydrants are citable matters, of course). The absence of a lit indicator lamp that shows a device that is tampered or nonoperational, and such vehicles would receive citations exactly as though they had no meter—no need to get Draconian over tampering a device you volunteered to put in your own vehicle!

Parking officers who enforce these one-hour free parking areas would do exactly what they always do, while simply ignoring any correctly parked vehicle with a correctly flashing indicator lamp.

Participating commuters may prepay or post pay as the city may prefer. In fact both could be offered.

Lest this appear somewhat complicated for a few million dollars and a few hundred thousand parking spots that may be 20% or 30% utilized, consider that this same technology can manage residential parking reducing the fees for residents who may park less on their streets when they travel or when they put their car in their driveway or who may agree pay to park on another residential street to visit late or overnight. Consider that the same technology can manage any street parking—later on. Consider that any participating commuter who drives a hybrid for all electric vehicle could be given a 20% discount when using Toronto Parking Authorities facilities (the technology works for garages as well).

But the most powerful single value for self-enforced time and place-based parking meters is the management innovation of Dave Hill (until recently Chief Operating Officer, Winnipeg Parking Authority). Calling it “Graduated Parking”, he set up a pilot that permitted the use of on-street parking to extend beyond the initial two-hour limit of participating parkers who were willing to pay an increasing fee for each 15-minute parking time slice. This method even permits the first hour to be free, if the City wishes to grandfather this privilege.

With prices appropriately designed, parkers who stay beyond a normal one, two or three hour limit will pay a slightly heftier fee for the extra time, but being self enforced will require no citation. This permits the city’s parking enforcement staff to manage more square miles of onstreet parking with the same staff contingent while reducing city court costs and increasing revenues—revenues that are needed for our streets and sidewalks...

...revenues that can help keep a lid on Toronto residential property taxeswhich is in line with Mayor Ford’s promise to hold the line on property taxes.


Using a parking lottery to manage congestion

Here is a way to use pricing and rewards to manage peak-hour congestion: Institute a parking lottery that is fully funded by the drivers.

First, a city passes a by-law (equivalent) mandating the raising of parking rates by, say, 50 cents or a dollar. The extra money (net of lottery admin) funds prize money. Each time a vehicle enters a parking garage or lot 30+ minutes before and leaves 30+ minutes after a designated peak hour, its license plate number is scanned by computer and is entered into a computerized lottery. The vehicle must remain in the garage for the whole time.

The parking fee premium is pooled and bundled into $5000 prize lots to be awarded by weekly by computerized draws against the plate numbers that qualify. (Plate numbers and locations are personal information that would not be disclosed.)

Thus, drivers who drive in peak hours are paying the prize money for the drivers that drive off-peak. The parking premium can be raised (hence affording more prizes) to manage congestion. This is simply load balancing by lottery. In other words, it enables the municipality to titrate or influence road congestion, not necessarily control it completely. Best of all for city managers, it promotes green innovation, which is never a bad thing.

Government keeps none of the parking fee premium intended for the lottery to guarantee that this is a pure congestion management scheme and not a tax-scheme. An independent auditor can ensure fairness and no skimming and many garage operators use software that can manage this anyway (part of the lottery expense, of course). In order to be most effective, employer lots and garages over a certain size must participate in a way that ensures the cessation of “free-parking” for employees. The minimum operation size would be set by the cost of license plate camera setup, since every participating lot or garage must contribute zero or more dollars to the prize pool (any garage too small by virtue of equipment expense would draw down the prize pool unfairly and no garage operator should be permitted to lose income due to participation).


European vs American Road Pricing view

The idea of metering road use using GPS-based telematics to determine time-place-distance-based use fees – ostensibly to replace the failing fuel tax – has received a lot of government attention over the past two decades. Because governments predominantly think about funding and sustaining the transportation system, they generally view such a collection system as a critical and dedicated system.  Too bad.

As recently as three years ago – two years before the ignominious collapse of its nation-wide, all-eyes-watching, road-pricing plan – the Dutch started to play with the idea of adding a few extra features. These Value-Added Services (VAS) were seen mostly as sugar-coating to make the medicine a bit easier to swallow.

Here is the image-metaphor used in a presentation overviewing the German Toll Collect system at a Spring, 2010 conference in Oslo (less than a year ago!). The slide title was: Value-Added Services: only the cherry on the cake.
Figure 1. European View/Government View
Nothing I have written in the past 8 years approaches the instant clarity of this accidental condemnation of the government view. Only a political cartoonist could match this. This view, necessitated by the need to replace or augment fuel duties and manage demand, leaves nothing for the motorist to desire. Who wants the maraschino cherry, if someone else gets the cake? It is this perception of the governments’ intentions that makes road-use charging so unappealing – so unacceptable – to motorists.

I predicted recently that US thinking in the matter of RUC would soon overtake EU thinking. That time is arriving sooner than I thought.  In the Fall of 2010, a report was prepared for AASHTO by Paul Sorensen and some colleagues from The RAND Corporation. I am guessing that upwards of 100 people had some input into this study.

A key stated purpose of the study on which the report was based was to determine who should bake the American version of the cake in Figure 1, The Federal Government or the State Governments.  To Sorensen’s credit, he included a third option, in section 6.2.3, reviewed here, a new approach, in which the paradigm of tax-centricity is replaced by one of service centricity. The artist who created the Olso conference slide might draw it as in Figure 2.
Figure 2: American View/Industry View

Big difference. If we bake the services cake right, we could gain acceptance, build a massive telematics industry, make cars safer, make trips more efficient, and much more. Maybe the Americans will get this right where the Europeans have led, but (so far) failed.


There are only only extremes

Here is a remarkable set of talks. From Jan 20 2010. (see the video that pops up).

This covers three extremes (there seem only to be extremes):
  1. anti-rail solves congestion - Randall O'Toole
  2. pro-transit solves congestion - Michael Replogle
  3. nothing solves congestion - Anthony Downs
I will not correct them. They are each partly right and partly wrong. Rather I note that none is fully acceptable to all commuters and that pricing is critical no matter which flavor you prefer.  In fact, the only thing that ALL three DO agree on is that market pricing - or pay relative to use - is critical.


Road Pricing - Fairness for the Disabled

Dear Mr Grush,

How do you and your concept/company propose to deal fairly with those whom public transit does not serve effectively?

The disabled are still not and may well never be adequately, never mind equally, served by any public transit system.  There are and probably always be far too many compromises imposed on the disabled who always have fewer options available to them in virtually all areas and especially in terms of mobility.  Are you aware how your systems would further disadvantage the families and friends of the disabled?  How would you suggest the family of a child with Osteogenesis Imperfecta cope?  Have you considered how would a family with one or more disabled child (cerebral palsy, spina bifida, muscular dystrophy autism spectrum disorder, hearing impairment, blindness or any of hundreds, even thousands of syndromes or conditions) be affected by the additional costs of negotiating life?

Have you considered how the elderly, especially the frail elderly, would be negatively affected by your systems?  How would their care and ability to maintain their own homes and any independence or any social life be accomplished without entailing enormous additional costs and logistical difficulties?

As well, as long as many medical services are made available mainly in a few major urban centres there will be many patients residing in other regions who will continue to be forced to travel by private vehicle to these designated facilities in order to receive essential treatment.  Besides spending time, money and energy simply to have access to medical care your system would impose additional burdens, adding to costs and logistical barriers.  How would propose minimizing or, preferably avoiding completely, these further undeserved difficulties for an already disadvantaged population?   

I look forward to receiving your well-reasoned reply to my questions.

Margaret Trethewey
Dear Margaret,

Thank you for your questions. I think your concerns are very important. However, these are matters of policy.  While such policies are easy to describe, I am not a legislator so I cannot set them, rather I am cybernetics engineer that likes to address complex social problems (congestion is a social problem, but is not often recognized as such, which is why it remains unsolved)).  More importantly, with reasonably simple policies not only can those people who must use private motorized transportation (and there are many - indeed I doubt that there are very few who never need it), have that access at a free or reduced cost (similar to not having to pay a fuel tax), they would also have that transportation at a reduced level of congestion.  Consider all the people that use the TTC's WheelTrans service [a door-to-door service for disabled passengers in Toronto], but get stuck in heavy traffic.  These people will also see a benefit.

As a matter of considerable bearing on the answer to your questions, one of my patent applications provide for a way for government to grant travel credits to individuals (for whatever reason deemed necessary – and you provide the start of such a list).  Such credits can be provided in a number of ways.  My personal preference is to provide travel credits as a form of fungible units that can be sold (for example if a person does not need all the credit available, she may be able to give or sell them to another. This allows people more choices.
An alternative, mentioned by Andrew Coyne in this week’s Macleans is to collect all the money from all the road fees and return it to all citizens in equal measure.  That would mean than some physically disadvantaged people would receive a surplus.

There is no reason that anyone with a disability need experience any additional hardships as you fear may befall them, but I would never suggest you should not remain vigilant.
I would like to examine further re a criticism buried in your question about the elderly. You describe a road-pricing system as “entailing enormous additional costs and logistical difficulties”. Although it is possible to do it this way (London did!), there is no reason for either outcome.  A properly designed system (EVEN WITHOUT TRAVEL CREDITS) would be cost neutral – even cost saving (!) – for people who travel off-peak.  So any ‘elderly’ drivers (I assume you to mean people who are retired or whose caregivers may be driving them) can avoid high costs by traveling off-peak. There is also no need for “logistical difficulties”, as a properly designed system is as easy to use as a cell phone that an elderly person carries, but never uses – it is mounted on the windshield of their car and a bill (amounting to $10 or $20 a month in today’s dollars, depending on whether they still pay fuel tax) arrives in the mail – or in their children’s email, which is how I would handle it. I wrote more about low per-driver charges in North America, here.
Bern Grush


Here is a resource list.  I will add to it from time to time.