Identifying a project sponsor is one of the first and most important issues to resolve in implementing a priced managed lane project. The project sponsor plays the most significant role in project
implementation. As shown in Table 3-1, a project sponsor can be responsible for nearly all activities during a priced managed lane project’s development and operations. The project sponsor often will execute planning studies, submit applications and environmental documentation, and oversee the construction and possibly the ultimate operation of the facility. The implementing agency will need to be vested with, or obtain the legal authority to collect tolls, and it will need to function as a champion for the project to garner the critical public and political support needed to bring the project to fruition.
Experience has shown that a variety of project sponsors and operators may be involved. Most frequently, a state DOT acts as the project sponsor, but turnpike and toll road authorities, local transportation agencies and authorities, and public transit agencies can also sponsor or cosponsor a priced managed lane project. Often a long legacy of institutional relationships has already been established among project participants. Therefore, it is important to understand these relationships and determine if any pre-existing political or institutional issues should be addressed.
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Priced Managed Lane Guide Table 3-1:Priced Managed lane PrOjecT acTiviTiesand resPOnsibiliTies
State DOT*
Turnpike / Toll Authority*
MPO and Other Local Agencies*
Transit Agency*
Private Development Partner
Private
Consultant Contractor
Law enforcement Agency / emergency response Project Development Planning / Technical StudiesXXXXX Education and Public OutreachXXXXXX Federal Programs and Grant ApplicationsXXXX Environmental Review / PermittingXXXX Project FinanceXXXXX Contract Award and AdministrationXXXXX DesignXXX ConstructionXXX Operations Toll Collection and BillingXXXX Facility OperationsXXXXX Performance Monitoring / ManagementXXXXXX Maintenance OperationsXXXX EnforcementXXX Incident ManagementXX Customer ServiceXXXXXX MarketingXXXXXX Transit OperationsXX Source: Parsons Brinckerhoff * Potential project sponsor
3.2.1 State Departments of Transportation
As the primary providers of highway service and owner/operators of a majority of the nation’s managed lane projects, DOTs are logical sponsors of new priced managed lane facilities. They have extensive experience in planning, designing, constructing, operating, and maintaining limited-access highways.
They have the financial depth to contemplate building new highway capacity and to obtain the expensive toll collection and traffic monitoring systems that priced managed lane facilities require. DOTs also have the power of eminent domain and many DOTs are already operating HOV networks with extensive electronic traffic monitoring capabilities.
While state DOTs have a wealth of highway experience, they may not necessarily have the legal authority to levy tolls (see Section 3.4.1). They also may not be familiar with the operation of tolled facilities and the sophisticated electronic toll collection traffic monitoring systems that priced managed lane projects require, and in certain cases they may have limited legal authority to privatize these operations. Toll road operation also involves back-office activities including auditing, credit card billing, and customer service, all of which may be new activities for many DOTs.
3.2.2 Turnpike and Toll road Authorities
As a precursor to the interstate highway program, many states developed turnpike and toll authorities with specific legislative charters to finance, build, and operate limited-access, high-speed highways. While the advent of the interstate program provided a dedicated federal motor fuel tax to provide funding for non-tolled highways, most legacy toll authorities continue to serve their original roles. Fiscal constraints beginning in the 1980s have led to renewed significance and presence of toll authorities, especially in fast growing areas such as California, Texas, Colorado, Florida, and North Carolina. Some of these authorities are state or county agencies, while others are joint entities formed by multiple jurisdictions.
In certain cases, the involvement of turnpike and toll authorities may facilitate the implementation of a priced managed lane project. In addition to engineering and construction experience, they are already vested with the legal authority to operate tolled highway facilities, thereby obviating the need to seek special authorizing legislation. Turnpike and toll authorities have the staff and systems in place to conduct all back-office revenue handling and accounting activities. In addition, many operate the advanced electronic toll collection and traffic monitoring systems that priced managed lane networks require.
While turnpike and toll road authorities offer natural advantages, they are not common in all areas across the country. In addition, if priced managed lanes were introduced along un-tolled highway segments, they would not involve roads already under the control of such authorities. Nonetheless, given that motorists are accustomed to paying tolls to turnpike and toll road authorities, their involvement in the operation of priced managed lane projects could help in gaining the public’s understanding and acceptance of these potential projects.
3.2.3 Local Transportation Agencies and Authorities
In order to receive federal funding for transportation projects, all urbanized areas in the United States are required to establish an MPO. MPO status is designated by the United States Department of Transportation (USDOT) and is usually given to regional Councils of Government or other joint powers’
authorities. These groups are generally governed by a board of elected officials representing municipal
Priced Managed Lane Guide
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governments within their jurisdictions, as well as county officials, and public agencies that operate transportation systems. State DOTs sit on all MPO boards ex officio. The organizational structure of MPOs varies around the country, and in certain cases, MPO status is given to county or municipal governments.
In some areas, local authorities have been created to assist MPOs in securing funding and implementing projects identified through the MPO. These transportation or funding authorities, created at the county or regional level under varying conditions, can help to study the merits of priced managed lanes and secure funding for their implementation. Once a project is operational, they may be responsible for disbursement of net revenues collected. County-level transportation agencies have been especially instrumental in California, where they serve in varying capacities, as state mandated Congestion Management Agencies that plan and fund projects at the county level, as administrators of county-level local option sales taxes devoted to transportation, as transit operators, and as combinations thereof.
Given their regional mandate and their planning function, MPOs and local transportation authorities may be logical sponsors of priced managed lane initiatives. They have commissioned several of the priced managed lane studies that have been carried out in California, the Phoenix region, the Washington, D.C., metropolitan region, and elsewhere. Their active and consistent support is also essential if a new priced managed lane facility is to be built, and local transportation authorities often play a primary role in the initial planning studies investigating the feasibility of such projects. Although most MPOs are likely to lack operating experience or tradition, some might play a further role in overseeing the implementation and operation of a priced managed lanes facility, such as with the I-15 Express Lanes in San Diego, where SANDAG has cosponsored the project in conjunction with the state DOT. County-level transportation agencies in California are also prominent sponsors of priced managed lane projects in the San Francisco Bay Area and Southern California.
3.2.4 Public Transit Agencies
Public transit agencies present interesting opportunities for participating in priced managed lane projects.
Several transit agencies operate bus rapid transit or HOV facilities that have excess capacity that could be sold to carpoolers, vanpoolers, or single occupant vehicles and operate as a HOT facility. Utilizing additional roadway capacity for other vehicles can help win political and public support and may limit the need to add additional roadway capacity. In the same vein, the participation of transit agencies in priced managed lane projects sponsored by other agencies highlights the potential for priced managed lane projects to provide opportunities for promoting reliable mass transit improvements. Finally, transit agency involvement in the development of priced managed lanes may also help to introduce new sources of capital funds and in return, as with the I-15 in San Diego, I-25 in Denver, and 95 Express in Miami, priced managed lane revenues can provide important new revenues to support improved transit service.
It is important to note, however, that transit agencies would need to obtain the backing of the Federal Transit Administration (FTA) before being able to launch a priced managed lane project on their own.
Approximately 80 of the 130 freeway HOV facilities in the U.S. are considered “fixed guideway miles” for the purposes of FTA’s formula grant programs (Section 5307 and 5309). Generally in effect since Fiscal Year 2003 and clarified in the Federal Register in January 2007 (responding to Section 1121 of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users [SAFETEA-LU]), FTA also classifies HOV lanes as fixed guideway miles for the purposes of funding formulas, thereby ensuring that federal transit funding is not decreased when existing HOV facilities are converted to priced operation.
The converted facility must maintain certain operational performance standards, which may be higher
than generally required for priced managed lanes if the HOV facility was originally constructed using FTA capital grant funding. Facilities that were not eligible HOV lanes prior to being converted, non-HOV facilities converted to priced operation, and newly constructed priced managed lanes remain ineligible for inclusion as fixed guideway miles in FTA’s funding formulas.