Viewpoints : Private ‘Feeways’ an Answer to Full Freeways

Traffic congestion, smog and inadequate public funding for roads have all reached crisis proportions in California. In September, Gov. George Deukmejian approved plans that promise, for the first time, to address all three of these concerns. The new solution: private toll roads.

Freeways are a California trademark. For years, travelers in the state have prided themselves on their ability to get to and fro freely. This free feeling, however, has contributed to what can safely be termed one of the world’s greatest traffic problems.

Road space and public funds to provide and maintain the roads are both limited, yet urban growth continues at unprecedented rates--and experts say California’s population growth will continue to be far above the national average. One solution would be to put a lid on growth. Another solution is to allow the private sector to participate in the management of growth, to the extent that it can.

Deukmejian’s decision to allow four private toll roads to be developed is one method of getting the private sector to assist in coping with growth. And this idea seems to be catching on here in Los Angeles: Mayor Tom Bradley recently announced a plan to seek private-sector involvement to resolve the city’s unmet transportation needs--needs that were not addressed by the governor’s programs.

The four privately financed, developed and managed toll roads will include brand new roadways in San Diego County and in the San Francisco East Bay, toll lanes on the Riverside Freeway and a tolled extension of the Orange Freeway in Orange County. Most of these roads have a scheduled completion date of 1995-96, but the additions to the Riverside Freeway should be completed by 1992-93.

Private toll roads can do a great deal for the public. They promise freer flowing traffic (meaning less drive time to and from work) and less smog because moving vehicles produce less pollution than idling vehicles. Moreover, the fact that a private company builds and operates the roads and gets private-sector financing means that scarce public tax dollars will not be needed.

California’s 1989 private tollways law (AB 680) provides for a Caltrans-sponsored process whereby the private companies were to assess and identify areas where the need for improved transportation is greatest. Having completed this process, the companies developed plans for building, financing, maintaining and operating their proposed projects.

At the outset, some policy makers were skeptical that private industry would be interested in providing roadways. To their surprise, 13 consortia answered Caltrans’ plea for help.

Companies involved in these projects include Perot Group, First Boston Corp., Fluor Daniel, Prudential-Bache Securities, CRSS Inc., Citicorp and Parsons Municipal Services.

To be sure, these “feeways” will not replace existing freeways. Rather, the four private toll roads represent a $2.5-billion net addition to the state’s transportation system--without having to raise a cent in taxes. They will be completely new developments. And no one will have to pay anything for these roads unless they deem it worth using them and paying the toll. It’s not hard to see why this kind of deal is attractive to elected officials.

Tolls will be collected to repay the upfront lenders and to bring revenue to the operators.

Yet the new roads and financial benefits are not the only gains involved. All four of the private toll roads will be equipped with modern technology that will allow for freer flowing traffic despite having to collect tolls. The days of stop-and-go tollbooths and the resulting lines are behind us.

These toll roads will be equipped with electronic monitoring devices that allow vehicles to travel at normal speeds without having to go through tollbooths. This technology, referred to as automatic vehicle identification, or AVI, is similar to the use of a credit card. The motorist signs up with the toll company and receives a toll card that is placed on the car. Each time the car travels past a toll point, the motorist’s account is debited. All four of the approved private toll road developers plan to employ this technology.

In addition though, this technology makes it easy to charge higher tolls at rush hours and low tolls at other times--a benefit far more important than just providing a means for collecting fees. Two of the private toll roads plan to vary their tolls according to demand. This system, referred to as “congestion pricing,” promises to affect traffic flow like never before.

This congestion-pricing technique has long been used by the telephone companies. Telephone companies price calls made during business hours higher than others to free up lines. These private toll road operators can use this pricing system to free lanes from congestion.

Because of the price differences, some people will negotiate altered work hours with their employers, while others will refrain from taking unnecessary trips during peak traffic periods. Others will take car pooling more seriously, while still others will choose public transportation. In other words, people will begin to assess their transportation needs more appropriately, cutting out unnecessary trips--resulting in less traffic and less air pollution.

The current system, which does not permit management of traffic behavior through the use of market signals, is antiquated. The private tollway program is introducing this pricing concept in a controlled form. If it works on the new private tollways, we will all learn a valuable lesson in traffic management. If we can make two of our roads flow smoothly at rush hour, why can’t we extend the idea to others?

In short, what Caltrans, the governor and the private sector are doing is writing a bold new chapter in California’s transportation history. We are--let’s face it--experimenting with a radically different way, not just of financing and building highways but of managing them once they are in place.

The Iron Law of Freeway Congestion--that demand expands to fill every inch of freeway and bring traffic to a standstill--has until now seemed immutable. California is setting out to prove that it ain’t necessarily so.