LTC, Annual Forum, For Whom the Road Should Toll: The Future of Toll Roads and Road Pricing in California, 05/02/2008, Mark Watts

• 1. Second AnnualLeonard TransportationCenter Forum For Whom the Road Should Toll:The Future of Toll Roads and Road Pricing inCaliforniaMark WattsCalifornia Strategies, LLCProspects for Enabling Legislation May 2, 2008

2. Toll Roads in California:One Advocates perspectiveCalifornias modern experience with tolling for non-bridge purposesbegan in mid-80s.Most legislative proposals have been related to area-specifichighways.More recent efforts have been targeted at HOT lanesystems/projects and public agency tolling rather than generaltolling.Federal incentives have increased the urban area interest. SF (DoyleDrive UPA), San Diego, and most recently, LA Metro. 3. Historical PerspectiveMid 80sBay Bridges: eliminating bar on new bonds opens up tolling increases;TCAs: authority to blend toll funding with development fees to open upEast Orange county roadway system;Late 80sRegional Measure 1: Bay Area Bridge toll increase to address new bridgesand connectors approved by voters.AB 680: Californias pioneering demonstration program for P3 ultimatelybrings SR 91 and SR 125 projects into reality;Californias Transportation Director provided superb stewardship of AB 680. 4. Continued,90sSANDAG Managed Lanes: successful implementation of managed lanes onI-15.High Desert Corridor tolling bills: all fail.AB 2660 (Aquiar), general private investment-based fee authority, extendsto highways, tunnels, etc. Has bar on use on state highways and for anystate funded project. To date, no roadway project has been pursued,although BART is relying on for Airport Connector. 5. Continued,Post 2000:HOT Lane Legislation adopted; improvements adopted in 2007 (authority tobond revenue stream systems in Alameda, Santa Clara, and San DiegoCounties).Regional Measure 2 approved by voters, extending bridge tolls, with anexpanded list of non bridge programs.AB 1010 (Correa) enacted to permit OCTA to acquire SR 91 franchise.AB 1467 (Nunez) approved; authority for 4 commercial vehicle and 4 HOTLane projects (2 North, 2 South).SB 1295 (Spitzer, 2007), related to I-15 HOT Lanes and 91 franchise passesAssembly Transportation committee, runs afoul of AB 1467 process. 6. Active Legislation, 2008SB1486 (Ducheny, 2008), establishes the Otay Mesa East Toll FacilityAuthority. Pending in Appropriations.AB 1954 (Jeffries, 2008), pursuant to AB 1467 process, approves CTCeligible project on I-15. Pending in Appropriations.SB 1316 (Correa, 2008), permits OCTA to relinquish 91 franchise withinRiverside County to RCTC. Senate Transportation Committee imposed manyelements of a possible future framework into the bill to willing sponsors.Concepts like Excess Revenues, admin caps, public notice on tolls ratchanges, 2/3 public agency vote to issue revenue bonds, etc.AB 2600 (Niello, 2008), Governors PBI initiative. Set for hearing this week. 7. Continued,AB 3021 (Nava, 2008), Creates the CTFA to provide for increasedconstruction of new capacity for the state highway system through theissuance of revenue bonds. Pending in Appropriations.LA Metro may seek (1) to expand 1467 or (2) other legislation to meet newUSDOT opportunity, although an argument can be made that they wouldqualify under 1467, as written. 8. Prospects Going ForwardLegislative perspectives Assembly - Limited interest in tolling as a general transportation finance tool. Support exists for public agency tolls aligned with congestion pricing on a regional or local basis. Current Leadership emphasizes 1467 process, but will that change?Senate - Two emerging themes are evident The first, through the Leadership, may seek broader authority for public tolling this year; The second, is the interest of Senate Transportation to rationalize current and future tolling statutes. 9. Continued,Legislative Analyst Routinely calls for exploration of tolling authority to supplement current state transportation resources.Governor Has sponsored several efforts to enact P3 legislation. This year his support for private investment led to establishing a partnership with other Governors, through Rebuilding America. Sponsor this year of Performance Based Infrastructure (PBI) initiative carried in AB 2600. 10. Conclusions/IssuesCreeping Incrementalism No holistic approach offered yet for state highways.Tolling pursued as regions identify as last resort funding or congestionmanagement tool.Supporters, other obvious coalition constituencies, have not forged arelationship and therefore no comprehensive public outreach.Public seems to accept tolling locally as projects are implemented.No Harm, no foul Legislature seems to look at each successive proposal as a district issue,that does not effect other constituencies: if this is what you want,attitude.However, NO big picture overlay evident.Senate Transportation Committee efforts on SB 1316 is an indicator of howthe Senate desires to pull current and future proposals into a commonframework. 11. CautionsEnvironmental Community Progressive organizations have been supportive over the past decade or more of congestion pricing; Recently, some are more supportive of congestion pricing when existing facilities are dedicated to that purpose, rather than new construction.Legislature - There is a core of pure opposition to tolling, on equity grounds. This could grow as the public policy issue becomes less parochial, and broader in application. 12. A Call for ActionDevelop a comprehensive coalition of builders, labor, motorists, publicagencies, and regional/large scale business groups. Do it right!Conduct comprehensive public research, statewide and regionally, tobetter understand public interest/support/reaction to emerging roll oftolling.Test reaction to paradox of increasing cost to operate vehicles (fuel, newtech vehicles) versus declining trend line for maintenance and roadwayinvestments.Develop preferred coalition goals of relative mix of congestion pricing,public general purpose tolling, and P3 (PBI).Roll out extended public education campaign.Plan to spend several years hard at work.