It's a revolutionary-and controversial-concept: making drivers pay to use the roads. My guess is light- and medium-duty fleets will take particular umbrage at this idea. After all, they are heavy users of the urban roads that would likely be the most expensive to use.
The idea is at the heart of a book by Joseph Giglio, Ph.D, professor of strategic management at Northeastern University's graduate school of business, titled “Mobility: America's Transportation Mess and How to Fix it.”
Professor Giglio, I might add, is not some pie-in-the-sky theorist. In fact, he helped pioneer creative financing for transportation needs as chairman of President Ronald Reagan's National Commission on Public Works Improvement.
“It's not just about paying as you go,” he explained. “It also incorporates a ‘money back guarantee’ and what I call ‘open road’ tolling. In my conversations with fleets I've found that many are willing to pay more to use the roads, but they need to achieve time savings to justify they expense. So the number-one result from any pay-to-drive plan must be service improvements.”
That's a tall order. But talking to Giglio gave me the feeling that it's doable. “We already use a wide variety of technology — transponders, satellite communications, even cell phones — to track vehicles. Why can't we use that technology to record and collect tolls, without creating congestion bottlenecks caused by toll booths?” he asked.
Even more interesting is the idea of holding those in charge of the roads — local and state governments in particular — accountable for delays. “Road users, especially fleets, should expect performance guarantees such as maintaining speed limits above 45 or 50 mph or getting a credit to your account,” Giglio told me. “That's the way business works. Look at UPS and FedEx: They have on-time delivery monetary guarantees. It should be no different for the roads.”
Something must be done quickly.
According to the American Association of State Highway and Transportation Officials (AASHTO), it will take $5.3 trillion during the first quarter of the 21st century to provide the kind of highways and public transit systems necessary to support our economy. The breakdown: $4.2 trillion to offset normal wear and tear; and $1.2 trillion to overcome pervasive infrastructure deterioration resulting from under-funding in the past, as well as provide the minimum capacity expansion needed to support economic growth.
AASHTO reports that funding allocated by the Highway Bill, federal taxes levied on fuel, and monies appropriated by state and local governments will together meet less than two-thirds of that $5.3 trillion. That's a major pothole to fill.
“Fuel taxes — the primary funding mechanism for road maintenance and construction — haven't increased in 13 years and most of the states don't index their fuel taxes to the consumer price index,” Giglio pointed out. “Also, greater vehicle fuel efficiency over the years translates into less fuel consumed and thus less taxes gathered. On top of that, about half of all U.S. states don't dedicate fuel taxes to roadways; those taxes go straight into their general revenue fund.”
That all adds up to a near-term fiscal crisis for the highway trust fund, which is expected to start posting deficits by 2009, if something isn't done soon.
“The whole point is that we must find a more equitable and unobtrusive way to collect the taxes necessary to improve and expand our roadways,” Giglio told me. “We also need more accountability in the system. And technology exists today to help us achieve those goals.”