Get Smart Part II: If Managed Lanes Can Work in the South, Why Not the North?

Our October 21 blog on managed lanes projects in Southern California talked about how three county transportation agencies are expanding on the success of the SR91 Express Lanes in Orange County, Calif., by using managed lanes to further relieve congestion and improve mobility in the region.  Not to be outdone by its Southern California cousins, the Metropolitan Transportation Commission (MTC), the transportation planning and funding agency for the nine-county San Francisco Bay Area, just received the blessing of the California Transportation Commission (CTC) to develop and operate a value pricing program that will involve either the conversion of existing HOV lanes or the development of new HOT lanes.  As with the Southern California setting, several Bay Area agencies are already developing and operating HOT lanes in their jurisdictions.  MTC’s application is the last that will be processed under California’s HOT lanes demonstration program, which expires at the end of this year, and authorized four HOT lanes projects (the RCTC and LA Metro express lanes projects described in our last entry secured the two Southern California slots under this legislation).

MTC’s goal in pursuing the HOT lanes application is to fill in the gaps in the HOT lanes network by converting 149 miles of existing HOV lanes to HOT lanes and adding 116 miles of new HOT lanes to create a seamless experience for the motorist.  According to a detailed cost-benefit analysis, implementation of the program could produce benefits equal to over 3.3 times the costs of developing the network, achieved primarily from travel time savings and emission reductions.  MTC estimates that—depending on the availability of funding and the timing of the permitting process—delivery of the new network will occur between 2015 and 2030.  The Bay Area Toll Authority, which operates the seven state-owned toll bridges in the region, is likely going to be the toll collection entity.  MTC anticipates utilizing a variety of funding sources, including senior toll road revenue bonds, TIFIA loans, local contributions, and grant funds to pay for the $3.5 to $4.3 billion capital costs of the program.

MTC’s application acknowledges that there is still a fair amount of work ahead to implement the program, including the execution of agreements with the California Department of Transportation (the network will be built in state right of way), FHWA (several of the projects involve tolling federal interstates), and county transportation agencies (integration of the new/converted lanes into the existing projects).  And MTC will be looking at the optimal delivery approach for design, construction, operations, and financing.

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Nossaman LLP’s 30-plus infrastructure attorneys offer clients, colleagues, strategic partners, and industry media a wealth of practical experience, insider insight, and thoughtful analysis here on Infra Insight. We blog about what we know best, from industry-leading procurements to local and national policy developments that affect the market and our clients.

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