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Infra Insight Blog Law & Policy

Obama Administration Introduces Significant Changes to Federal Tolling Law

Posted in Policy

In our prior posts we noted the important changes in federal tolling law under MAP-21 and some of the issues raised by those changes.  MAP-21 modestly loosened the federal reins on tolling the nation’s Interstates and federal-aid highways.  The Obama Administration just released its federal surface transportation reauthorization legislation, the “Grow America Act”.  In section 1405, the Administration proposes further constructive steps to expand tolling rights, but reintroduces some constraints that MAP-21 relaxed.

Probably the most important proposal is to create the right to toll an Interstate facility in connection with its reconstruction.  Today this is permitted only for a maximum of three projects nationwide under the Interstate Reconstruction Pilot Program.  Section 1405 would replace the pilot program with a statutory tolling right for Interstate reconstruction, without any limit on the number of eligible projects.  The significance of this proposal cannot be overstated.  It proposes that previously free, general purpose lanes could be tolled in order to fund Interstate reconstruction.  Except for the small pilot program, this has been forbidden since the inception of the Interstate system 60 years ago.

Just as important is a proposal to allow conversion of any portion, or even all, of a toll-free facility, including the Interstates, to a tolled facility in order to promote congestion management.  No HOVs could be tolled.  The tolling regime would have to consist of variable tolling to manage demand.  The method of variable tolling appears to be flexible enough to allow either time-of-day pricing or dynamic pricing.  This proposal can be explained by the Administration’s environmental priority of reducing carbon emissions and achieving air quality attainment.  This provision, too, would be a groundbreaking departure from the historic ban against tolling free, general purpose lanes.

Section 1405 proposes to expand the purposes for which toll revenues may be used.  It would authorize use for public transportation that is within the corridor of the tolled facility or contributes to improved facility operation.  It also would allow tolls to be used to mitigate adverse impacts of tolling, such as the impacts of traffic diversion.  These provisions likewise are informed by the Administration’s environment priorities and promotion of public transit.

Section 1405 would require that all toll facilities first opened to traffic after October 1, 2015 use only non-cash electronic tolling technology to allow free flow of traffic.  This is consistent with the clear trend national toward all-electronic tolling and interoperability.

The quid pro quos are the reintroduction of federal regulatory controls and elimination of several MAP-21 tolling rights:

  • MAP-21 dropped most requirements for USDOT approvals and tolling agreements.  Section 1405 would re-impose USDOT approval rights for tolling in connection with Interstate reconstruction and for conversions of toll-free facilities to managed lanes, and give the USDOT broad authority to issue regulations on what criteria must be met.  The Administration apparently shrinks from letting states decide on their own whether to pursue such tolling arrangements.
  • MAP-21 on its face seems to authorize conversion of HOV lanes to tolled lanes without conditions.  FHWA, however, has interpreted this provision to require that, among other things, HOV vehicles continue to have toll-free use of the converted lanes.  Section 1405 would eliminate any ambiguity by mandating toll-free HOV use.  The only remaining way to toll HOVs in converted lanes would be through the Value Pricing Pilot Program, if a state happens to hold one of the VPPP slots and can get the USDOT to approve HOV tolling.
  • MAP-21 created the right to toll in connection with restoration or rehabilitation of an Interstate highway.  Section 1405 would eliminate this right.  No doubt USDOT criteria for Interstate reconstruction would distinguish between reconstruction, on the one hand, and restoration and rehabilitation, on the other hand.
  • The MAP-21 right to vary toll rates by type of vehicle, and to exempt vehicles from tolls, would be eliminated.  It is unclear whether the intent is to require uniformity of toll rates (for other than managed lanes).  Toll rate uniformity would pose very serious feasibility and political issues for tolling authorities.

We and others have advocated for wholesale removal of federal restrictions on tolling, except for restrictions on permissible uses of toll revenues.  On the whole, Section 1405 of the Grow America Act is a good step in the right direction, particularly because it seeks to address the looming problem of how to pay the massive amounts that will be needed to reconstruct the nation’s Interstates.