Pricing Methods
Techniques for Collecting Road, Parking and Vehicle Fees
~~~~~~~~~~~~~~
Victoria Transport Policy Institute
~~~~~~~~~~~~~~~~~~~~
Updated 4 November 2008
This chapter describes and compares methods of collecting road tolls, parking fees and mileage charges. Newer electronic pricing methods tend to be more convenient and cost effective to implement, and can incorporate more variables, such as time, location and vehicle type. This can help overcome many objections to direct user charges and provide more marginal pricing.
Several TDM strategies involve pricing.
·
Comprehensive Market Reforms
A variety of methods can be used to collect transportation pricing fees. They differ significantly in terms of their costs (fee collection typically absorbs 10-30% of total revenues), convenience, and price adjustability (prices that can vary by time, location, vehicle type, or other factors).
Consumers generally prefer pricing techniques that are easy to understand, convenient and quick to use, accepts a variety of denominations (coins, bills, credit cards and prepaid vouchers), and allows them to pay for just the amount of vehicle travel or parking they use. Many of the concerns and objections to pricing relate to the methods used to collect fees. For example:
· Road pricing systems require vehicles to stop at a tollbooth.
· Many systems require specific denominations (coins or bills), and so are frustrating and slow to use.
· Many parking systems require motorists to predict how long they will be parked and pay based on the longest period of time they may be parked. In practice, this is often difficult, forcing motorists to pay for time they don’t use. For example, a one-hour meeting often requires parking for 70 or 80 minutes to accommodate time to arrive and leave. Some systems only sell one or two-hour blocks, so motorists must pay for two hours for a one-hour meeting, or face the risk of a fine. Yet, the meeting may be canceled or end early, so the motorist pays far more than they really needed.
· Many payment systems cannot easily handle multiple price structures or discounts.
· Enforcement often seems arbitrary and excessive (particularly for parking pricing). Motorists who pay for parking may feel taken advantage of if others park for free either due to special privileges or knowledge of free parking options.
Efficient and fair pricing requires that user fees reflect the marginal costs imposed by each individual trip as closely as possible (Market Principles). No pricing method is perfect. In general, pricing that is more adjustable and more convenient tends to have higher implementation costs. This requires trade-offs between transaction costs and pricing accuracy. Newer electronic systems can be highly accurate, very convenient, and are increasingly cost effective. A smart card is an electronic payment system that allows fast and seamless payments for transit use, roads, parking, bicycle rentals and other conveniences not yet explored. Some smart cards employ contactless technology which automatically deducts the correct payment value when a motorist or transit patron passes by a sensor, even if the card is in a purse or pocket. Some systems also allow payment by mobile telephone.
Road Pricing means that vehicle users are charged a direct fee (toll) for driving on a particular road or bridge, or in a particular area (a “cordon”). For more information see the “Value Pricing and Congestion Pricing Website” (www.valuepricing.org), the “ETTM Electronic Toll Collection and Traffic Management Website” (www.ettm.com) and the “European Transport Pricing Initiative” (www.Transport-Pricing.Net). Pickford and Blythe (2006) provide detailed technical analysis of electronic pricing options.
Motorist must purchase a pass to enter a particular area (a cordon), such as a city or a central business district. Passes may be specific to a particular type of vehicle or a particular time. Some systems only require passes during congested periods, such as weekday mornings. Free or discounted passes may be provided to area residents. Passes may be sold directly by government agencies or by retail stores. They tend to be inexpensive to implement and easy to use, but prices cannot reflect how much driving a vehicle does within an area, or other factors, and so are not marginal.
|
Advantages |
Disadvantages |
Applications |
|
Cheap and quick to implement. Convenient to use. |
Limited price adjustability. Not marginal. |
Cordon pricing. Unlimited use road or bridge fees. |
Conventional tollbooths located on a roadway require motorists to stop to pay with money or tokens. Most have attendants, although some have automatic coin collection systems. These tend to have high operating costs, are inconvenient to motorists, and increase traffic congestion and local air pollution. Prices can vary by time and vehicle type, but tollbooths are generally spaced several miles apart so they cannot reflect fine mileage gradations. They are generally only applicable on bridges, grade separated highways or cordon entrances.
|
Advantages |
Disadvantages |
Applications |
|
Many are in place. Moderate price adjustability. |
High cost. Requires vehicles to stop. |
Major bridges, highways and cordons. |
Electronic toll collection refers to automated systems that measure and bill motorists. A small transponder is placed inside the vehicle, which is counted each time the vehicle passes a roadside sensor. The tolling agency maintains an account for each vehicle, which is debited with each use of the roadway. Another system uses a “smart card” charged with a certain dollar value that is placed inside the transponder. Each time the vehicle passes a roadside beacon the appropriate fee is subtracted. This system protects motorists’ privacy, since there is no record of when or where the vehicle is driven.
These systems tend to have high implementation costs, and moderate to high operating costs. They have economies of scale, so unit costs decline significantly as the system expands. They can be used on any roadway, not just grade separated highways. It is possible to have many roadside sensors, allowing fine gradations of both mileage and time rates.
|
Advantages |
Disadvantages |
Applications |
|
High price adjustability. User convenience. |
High implementation costs. Some privacy concerns. |
Any road system. |
This system tracks vehicles as they pass a point in the roadway by automatically scanning the license plate. This information is used to generate a bill that is either subtracted from the vehicle’s account, or mailed as an invoice.
These systems tend to have high implementation costs, and moderate to high operating costs. They tend to have economies of scale, so unit costs decline significantly as the system expands. They can be used on any roadway, not just grade separated highways. It is possible to have several cameras, allowing moderate gradations of mileage, and fine gradations of time.
|
Advantages |
Disadvantages |
Applications |
|
High price adjustability. User convenience. |
High implementation costs. Some privacy concerns. |
Major bridges, highways and cordons. |
The GPS (Global Positioning System) based pricing uses a small electronic transponder to track an object’s geographic location (Forkenbrock, 2000; CFIT, 2002). Transponders must be securely installed and wired into vehicles. Transponder installation currently costs $300-500 per vehicle, about half for equipment and half for labor. Equipment prices are declining, and within a few years many new cars will have factory-installed GPS systems. GPS-based services are marketed to motorists for communication, navigation and emergency response. For example, GM’s OnStar service (www.onstar.com) provides hands-free cellular telephone and Internet access, directional assistance, remote power door unlock, theft recovery, emergency roadside assistance and a panic button. RoadRemote.com (www.roadremote.com) offers similar services.
In 2001, the Oregon Road User Fee Task Force (www.odot.state.or.us/ruftf), and research supported by several state transportation agencies (Forkenbrock and Kuhl, 2002), began investigating possible ways to replace the state fuel tax as a road user fees, in anticipation of more fuel efficient and alternative fuel vehicles. The Task Force is considering a system in which new vehicles will be equipped with devices that automatically report the amount of miles driven within the state each time it is refueled, with the results used to calculate a mileage fee (Kim, Porter and Wurl, 2002).
GPS-Based pricing can incorporate virtually any pricing factor, including factors related to driver, vehicle, time and location of vehicle travel. As a result, it can be most accurate pricing system. GPS-Based Pricing raises privacy concerns, since they record vehicle’s travel time and location, although these can be addressed in system design, for example, by purging this data from computers once fees are calculated, and passing privacy laws that limit access to the data.
|
Advantages |
Disadvantages |
Applications |
|
Highest price adjustability. User convenience. |
High implementation costs. Privacy concerns. |
Any road system with comprehensive pricing. |
The table below compares road pricing methods.
Table
1 Summary of Road Pricing
Options
|
Type |
Description |
Equipment
Costs |
Operating
Costs |
User
Inconvenience |
Price
Adjustability |
|
Pass |
Motorists must purchase a pass to enter a cordoned area. |
Low |
Low |
Medium |
Poor to medium. |
|
Toll Booths |
Motorists stop and pay at a booth. |
High |
High |
High |
Medium to high. |
|
Electronic Tolling |
An electronic system bills users as they pass a point in the road system. |
High |
Medium |
Low |
High |
|
Optical Vehicle Recognition |
An optical system bills users as they pass a point in the road system. |
High |
Medium |
Low |
High |
|
GPS |
GPS is used to track vehicle location. Data are automatically transmitted to a central computer that bills users. |
High |
Medium |
Low |
High |
This section describes common methods of collecting Parking Pricing fees. For more information see FHWA (2007), the “Electronic Parking Buyers Guide” published by the International Parking Institute, available at www.parking.org, and the Parking Industry Guide at www.expo1000.com/parking.
Parker purchases a pass (card, sticker or decal) that is displayed on the vehicle. Passes can be coded for different times or areas (e.g., parking lot A, weekday only, etc.). They have low implementation and operating costs. Expenses include printing and selling passes, signs and enforcement, which typically total about $50 annually per space. They are most suitable for long-term users (monthly or annual passes) for employees and residents, although they are sometimes used to collect daily parking fees. Rates can be adjusted when passes are purchased, but it is difficult to modify rates frequently, or to have many different rate categories.
|
Advantages |
Disadvantages |
Applications |
|
Cheap and quick to implement. Convenient to use. |
Limited price adjustability. |
Long-term (monthly or annual) parking fees. |
Parker prepays meters. Mechanical meters only accept specific coins. Electronic meters are now available that accept credit/debit cards, can have different rates for different times, and have occupancy sensors that automatically reset when a vehicle leaves the stall. They also tend to be significantly more reliable than mechanical meters. Costs include meters ($500-1,000 each), maintenance and repairs, revenue collection, and enforcement. These meters use more sidewalk space than other parking systems, and are considered unattractive. In typical applications they require that coins be collected two to three times a week. They are most suitable for short-term parking in busy areas.
|
Advantages |
Disadvantages |
Applications |
|
Well established. |
High costs Limited payment options. Users must predict how long they will park. |
Short-term parking. |
Parker prepays by inserting the appropriate payment into the appropriate slot in a secure box. Is inconvenient to users, who must predict how long they will park, use the correct combination of bills and coins, and receive no receipt. Costs include pay boxes ($500-1,500 each, which can serve 10-100 stalls), maintenance and repairs, revenue collection, and enforcement. This system is most suitable for off-street parking lots with low turnover. It is being replaced by other pricing methods that are more convenient to users.
|
Advantages |
Disadvantages |
Applications |
|
Low capital costs. |
Limited payment options. Users must predict how long they will park. |
Long-term (2 hr +), low-use parking facilities. |
Parker prepays a printer, which produces a time-stamped ticket that is displayed in the vehicle window. One printer can serve up to 75 off-street stalls, or about a dozen on-street spaces. Printers need to be close to parking stalls (within about 100 feet), and sufficient in number to handle peak demand. More printers are needed for parking lots with many vehicles arriving at the same time. Coin-only printers are relatively inexpensive ($1,000-2,000 per unit), but are inconvenient to users, since they require specific coins. Printers that also accept bills and credit cards (some even give change) are more expensive ($5,000-10,000 per unit) but more convenient to users. Costs include printers, maintenance and repairs, revenue collection, and enforcement. Electronic versions can be programmed for variable rates (such as lower rates in the evening and weekends). They are suitable for on- and off-street parking with 20+ stalls in one area. This appears to be the most common pricing system used by commercial parking companies due to its relatively low costs and moderate user convenience.
|
Advantages |
Disadvantages |
Applications |
|
Good price adjustability. |
High cost. Users must predict how long they will park. |
Most on- and off-street parking |
Parker prepays an electronic meter for a particular parking space (each stall is numbered). Enforcement officer downloads reports indicating which stalls are paid. One meter can serve up to 75 off-street stalls, or about a dozen on-street spaces. Meters need to be close to parking stalls (within about 100 feet), and sufficient in number to handle peak demand. Transaction can take up to a minute (particularly for users unfamiliar with the system), so line-ups can develop if several motorists arrive at the same time. More sophisticated meters can be networked so users can pay for additional time using a credit or debit card account at a meter several blocks away from where they parked, or using the Internet or telephone messaging, allowing motorists to pay from an in-vehicle telematic system or a cellular telephone. Meters can accept coins, bills, credit cards or special prepaid value cards. Costs include meters ($10,000 to $25,000 each), maintenance and repairs, revenue collection, and enforcement. Variable rates are easy to program. They are suitable for on- and off-street parking with 20+ stalls in one area.
|
Advantages |
Disadvantages |
Applications |
|
Very good price adjustability. |
High cost. |
Most on- and off-street parking |
Parker prepays for a certain value of parking credits (such as $10). Motorists insert the card in a meter when they park and remove it when they leave, with the time value automatically deducted.
|
Advantages |
Disadvantages |
Applications |
|
Allows motorists to pay for just the amount of time they will be parked. Avoids money. |
Requires new meters. |
Most on- and off-street parking. |
Parker prepays for a certain number of minutes worth of parking in a small meter (such as $10 for 600 minutes). The meter is turned on and hung from the rear-view mirror when the vehicle is parked in a designated stall (such as on-street parking spaces, or municipal off-street parking). Motorists only pay for the minutes they park. Can be used in conjunction with other parking pricing strategies.
|
Advantages |
Disadvantages |
Applications |
|
Allows motorists to pay for just the amount of time they will be parked. |
Limited price adjustability. |
As a consumer option for on-street parking. |
Parkers wave their mobile telephone in front of a contactless reader on parking meters. Can support various payment options, such as prepayment for a certain time period, or payment for the amount of time the vehicle is parked, until the telephone is again waved near the reader or a text message is sent by the motorist to a special telephone number.
|
Advantages |
Disadvantages |
Applications |
|
Convenient to user. Transactions are recorded. |
Requires new equipment. |
For new and upgraded systems. |
Parkers pay an attendant at the parking facility. At facilities with access control, parkers collect a time-stamped ticket when entering, and pay at a tollbooth when existing, based on how long they parked. At facilities without access control, attendant tracks each vehicle as it enters, and either collects a prepayment, or charges on exit. Typical costs range from $200 to $400 annually per space. Due to high labor costs, this is only suitable for large (200+) off-street parking facilities during peak hours. During off-peak periods such facilities may use other payment systems, such as Pay Box or Pay-and-Display.
|
Advantages |
Disadvantages |
Applications |
|
Good price adjustability. Provides security. |
High cost. |
Large off-street parking facilities during peak hours. |
Parker takes a ticket with the time recorded on a magnetic stripe to raise the gate, before entering the parking lot (motorists who have a long-term lease use a card to raise the gate, and so do not need to collect a ticket). When ready to leave, the parker inserts the ticket into an automated Pay-on-Foot station (similar to a bank machine), and pays with cash or credit card. This validates the ticket. They then have fifteen minutes to retrieve their vehicle and drive through an automated exit gate, which rises after the validated ticket is inserted. A pullout space is provided adjacent to the exit station for customers who forget to validate their ticket before driving to the gate. Typical costs range from $200 to $400 annually per space. This system is suitable for large off-street parking facilities.
|
Advantages |
Disadvantages |
Applications |
|
Good price adjustability. Convenient to use. |
High costs. |
Large off-street parking facilities. |
An attendant (valet) parks vehicles at an off-street lot, and returns them on demand. Motorist pays on pickup. Because attendants can move vehicles around and park in aisles, a larger number of vehicles to be stored in a given area than if drivers self-park. Typical costs range from $300 to $600 annually per space. Due to high labor costs, this is only suitable for relatively large off-street parking facilities during peak hours. During off-peak periods such facilities may use other payment systems, such as Pay Box or Pay-and-Display.
|
Advantages |
Disadvantages |
Applications |
|
Good price adjustability. Provides security. Convenient to use. |
High cost. |
Large parking lots during peak periods. |
Parkers preregister, and either prepay or authorize automatic credit/debit card payments. Electronic “Smart” cards or optical License Plate Recognition system tracks vehicles entering and leaving off-street parking facilities. Automatically charges users account for the amount of time vehicles are parked, and identifies vehicles that are not registered. Typical costs range from $200 to $400 annually per space. May be used in conjunction with other payment systems. This system is suitable for large off-street parking facilities with many regular customers.
|
Advantages |
Disadvantages |
Applications |
|
Good price adjustability. Convenient to use. |
High costs. |
Large off-street parking facilities. |
The table below compares parking pricing methods.
Table 2 Summary of Parking Pricing Options
|
Type |
Description |
Equipment
Costs |
Operating
Costs |
User
Inconvenience |
Price
Adjustability |
|
Pass |
Parkers purchase and display a pass. Common for leased parking. |
Very low |
Medium |
Medium |
Poor to medium. |
|
Single-Space Meters |
Parkers prepay a mechanical or electronic meter located at each space. |
High |
High |
Mechanical meters: high; electronic meters: medium. |
Mechanical meters: poor; electronic meters: good. |
|
Pay Box |
Parkers prepay into a box with a slot for each space. |
Low |
Medium |
High |
Poor to medium. |
|
Pay-And-Display Meters |
Parkers prepay a meter, which prints a ticket that is displayed in their vehicle window. |
Medium |
Medium |
Medium |
Mechanical meters: poor; electronic meters: good. |
|
Electronic Pay-Per-Space |
Parkers prepay an electronic meter. |
Medium |
Medium |
Medium |
Very good. |
|
Debit Card |
Parkers prepay a debit card which is inserted into a meter. |
Medium |
Medium |
Medium |
Very good. |
|
In-Vehicle Meter |
Parkers prepay to use a small electronic meter displayed in the vehicle when it is parked, that counts down minutes. |
Medium |
Low |
Low |
Moderate |
|
Contactless Mobile Telephone Payment |
Parkers wave their mobile telephone in front of a contactless reader on parking meters |
High to Medium |
Medium |
Low |
Good |
|
Attendant |
Parkers pay an attendant when entering or leaving a parking space. |
High |
High |
Low |
Good |
|
Automated Controlled Access System |
Parkers pay a machine when entering or leaving a parking space. |
High |
Moderate |
Medium |
Good |
|
Valet |
Parkers pay an attendant who parks their car. |
Low |
High |
Low |
Good |
|
Automatic Vehicle Identification |
System automatically records vehicles entering and leaving a parking area and can bill for use. |
High |
Medium |
Low |
Good |
Distance-Based Pricing means that vehicle charges are based on how much a vehicle is driven. For more information see Forkenbrock (2000); T&E (2000) and the “Value Pricing and Congestion Pricing Website” (www.valuepricing.org).
Mileage data can be collected using odometer audits. This involves five steps:
1.
Check speedometer and instrument cluster for
indications of tampering.
2.
Record tire size and check that it is within the
specified range.
3.
Attach a small seal to the ends of mechanical
odometer cables to indicate if it has been removed. This is unnecessary on most
newer vehicles with electronic speedometers.
4.
Check odometer accuracy and calibrate with a
dynamometer. This step is optional, or could be performed on a spot-check
basis.
5.
Record odometer reading and forward results to the
vehicle licensing agency.
Odometer audits would be performed when a vehicle’s insurance is renewed, in most cases once a year. Odometer audits typically require 5 to 10 minutes, and less if performed with other vehicle servicing (tune ups, emission inspections, etc.), with incremental cost of $5 to $10 (assuming chargeout rates of $60 per hour). Odometer auditors would typically be existing vehicle servicing, emission inspection stations, or other existing automobile services. Governments only need to certify auditors and incorporate odometer data into the vehicle registration database.
There are concerns that odometer fraud could be a problem, but odometer audits should provide data as accurate as that used in other common commercial transactions and more accurate than self-reported information now used for insurance pricing. Most tampering can be detected during audits and crash investigations, and fraud would void insurance coverage. Vehicle manufactures produce increasingly tamper-resistant odometers since leases, warranties and used-vehicle sales all rely on odometer readings. Audits would provide additional benefits, including accurate mileage information for used-vehicle buyers, and more accurate information for transportation planning.
Odometer auditing can be used for various distance-based fees, including insurance, registration fees, weight-distance charges and emission fees.
|
Advantages |
Disadvantages |
Applications |
|
Relatively inexpensive and convenient to use. |
Limited price adjustability. Infrequent (annual) data collection. |
Distance-based vehicle fees. |
The PAZOMAT system, produced by Hi-G-Tek (www.higtek.com),
allows odometer readings to be automatically collected each time a properly
equipped vehicle is refueled. It uses a small radio frequency (RF) wireless
transmitter installed in the vehicle and a small receiver installed in the fuel
pump. This system is has been used by the Paz Oil Company in
A Vehicle Use Detector And Recorder
(VUDAR) is a small electronic meter that records minutes-of-vehicle-operation,
developed by Westfields Software, Ltd. of
|
Advantages |
Disadvantages |
Applications |
|
Relatively convenient to use. |
Moderate costs. Infrequent (annual) data collection. |
Time-based vehicle fees. |
Vehicle use can be measured using an
electronic on-board data collection unit that records vehicle mileage. Other
data factors can be collected by automatically, or keyed in by the vehicle
driver. Data is transmitted manually or electronically to a central computer,
which generates a bill. Systems with integrated cellular telephones can
transmit data automatically.
|
Advantages |
Disadvantages |
Applications |
|
Can collect various types of data. Can bill monthly. Automated systems are convenient to use. |
Moderate to high costs. Limited price adjustability. |
Distance-based vehicle fees. |
The GPS (Global Positioning System) based pricing uses a small electronic transponder to track an object’s geographic location (Forkenbrock, 2000). Transponders must be securely installed and wired into vehicles. Transponder installation currently costs $300-500 per vehicle, about half for equipment and half for labor. Equipment prices are declining, and within a few years many new cars will have factory-installed GPS systems. GPS-based services are marketed to motorists for communication, navigation and emergency response. For example, GM’s OnStar service (www.onstar.com) provides hands-free cellular telephone and Internet access, directional assistance, remote power door unlock, theft recovery, emergency roadside assistance and a panic button.
GPS-Based pricing can incorporate virtually any pricing factor, including factors related to driver, vehicle, time and location of vehicle travel. As a result, it can be most accurate pricing system. This pricing system raises privacy concerns, although these can be addressed in system design, for example, by purging this data from computers once fees are calculated.
|
Advantages |
Disadvantages |
Applications |
|
Highest price adjustability. Can bill monthly. Convenient to use. |
Moderate to high costs. Privacy concerns. |
Time and location based vehicle fees. |
The table below compares distance-based pricing methods.
Table
3 Summary of Distance-Based
Pricing Options
|
Type |
Description |
Equipment
Costs |
Operating
Costs |
User
Inconvenience |
Price
Adjustability |
|
Odometer Audits |
Odometer readings are collected by certified odometer auditors, usually during scheduled maintenance |
Low |
Low |
Low to medium |
Low |
|
VUDAR |
Vehicle operating hours are recorded by a small instrument installed in each vehicle. Data are transmitted annually at a special station. |
Medium |
Low |
Low |
Medium |
|
On Board Data Collection |
An electronic system in each vehicle tracks mileage. Data are transmitted monthly to a central computer, either automatically or by users. |
High |
Medium |
Medium |
Low-Medium |
|
GPS |
A GPS system is used to track the location of each vehicle. Data are automatically transmitted monthly. |
High |
Medium |
Low |
High |
|
An engineer was walking one day when a frog called out to him and
said, “If you kiss me, I'll turn into a beautiful princess.” He bent over, picked up the frog and put it in his pocket. The frog
spoke up again and said, “If you kiss me and turn me back into a beautiful
princess, I will stay with you for one week.” The engineer took the frog out of his pocket, smiled at it and
returned it to the pocket. The frog then cried out, “If you kiss me and turn
me back into a beautiful princess, I’ll stay with you a week and do ANYTHING
you want.” Again the engineer took the frog out, smiled at it and put it back
into his pocket. Finally, the frog asked in frustration, “What is the matter? I’ve
told you I’m a beautiful princess, that I’ll stay with you for a week and do
anything you want. Why won’t you kiss me?” The engineer said, “Look I’m an engineer. I don’t have time for a
girlfriend, but a talking frog, now that’s cool.” |
For more examples see Nielsen (2005) and FHWA (2007).
“Congestion charge chiefs may profit from a Swedish lesson”
Ben Webster, The Times (www.timesonline.co.uk/article/0,,2-2120871,00.html), April 06, 2006
An intelligent congestion
charging system pioneered in
Drivers in
Screens on the
gantries display the amount that will be charged at that time. The system
deducts payments from drivers’ bank accounts by direct debit and issues monthly
statements showing the time of each crossing and the fee paid. The tags are
issued free and more than 420,000 drivers have fitted them since the scheme
began on January 3.
Those who do not
have tags are given five days to pay by post or at a shop. After that they are
fined £5, which rises to £40 after four weeks. In
The two cities
have the same number of drivers entering the charging zone each day but drivers
in
Olaf Sandstrom, a
journalist for
TfL is conducting
a six-month trial in Southwark involving 500 vehicles equipped with tags and 19
gantries with electronic beacons. Morten Bratlie, for Q Free, the Norwegian
company that supplied the technology in
State Route 91 in
Highway 407, the Express Toll Route (ETR), is a
new multi-lane, electronic highway running 69 kilometres across the top of the
Greater Toronto Area, from Highway 403 in
Rome Mobility Agency, NAI - New Applications and Innovations Dept. (www.sta.roma.it)
Automated access
control has been in operation since August 2001, and full enforcement against
violations will be in place by the end of the year.
Access control in
Technical and regulatory obstacles have been solved to allow high-level performance of the system. The transition from pilot to full-scale implementation required better integration among system components, improvements to the automatic identification of plates, safety of smart card payment, visual impact of the automatic gates, flexibility of the permit management system and respect of citizens’ privacy. From the institutional side, a clear definition of authorities’ and agencies’ roles at the local level was required. At the same time, the use of remote traffic control systems had to be regulated at the national level.
Pricing private car use in urban centres
responds to policies adopted at the international level both by the European
Union and the OECD (1). At the national level, the Italian Ministry for the
Environment has dedicated particular attention to transport externalities,
although not tackling urban road pricing directly. At the local level, STA -
the Mobility Agency of the City of
The approach adopted in the PRoGRESS project is
certainly embedded in the system vision of agencies and authorities in
1. European
Commission, Fair Payment and Infrastructure Use: a Phased Approach to a Common
Transport Infrastructure Charging Framework in the EU, White Paper, COM (1998)
466 final, 1998 European Conference of Ministers of Transport (ECMT), Efficient
Transport for Europe: Policies for Internalisation of External Costs, Paris,
1998
2. This integrated
approach is in line with the guidelines of the General Plan on Urban Traffic
(PGTU, Piano Generale del Traffico Urbano), adopted on 28 June 1999 and the analysis
carried out in the Integrated Mobility Programme (Proimo, Programma Integrato
per la Mobilità), recently presented by the Municipality of Rome and STA
What do you get when you add contactless payment abilities to your cell phone? A single device for making calls and credit card purchases. “You yak, you wave, you buy.” Credit cards that use contactless technology are already becoming familiar to consumers through devices such as the Mobil Speedpass. You make purchases simply by waving such devices in front of contactless readers. Credit issuers want to add the technology to your mobile phone, so you can scan it, too.
Credit-enabled phones, while years away in the United States, are already in widespread use elsewhere. In Korea, for example, cell phone users can wave phones at a machine and authorize a transaction of a few Korean wons for a bottle of soda.
In the U.S., neither the wireless system nor merchant acceptance is up to the task yet. "I don't expect the industry to have that infrastructure rolled out for at least five years," says Bruce Cundiff, research director, Javelin Strategy and Research. It will probably be 10 years before the majority of credit card transactions are contactless, not to mention phone transactions, he adds. But the list of interested parties includes the industry heavyweights: Visa and MasterCard have held contactless phone trials in major cities such as Atlanta and New York with partners such as Citi, Cingular and Nokia, says Manuel Albers, a director with NXP, co-creator of the contactless phone chip and partner in contactless trials. With 2.7 billion cell phones in circulation globally, credit issuers have plenty of motive for turning the gadgets into contactless credit devices, says Richard Crone, founder, Crone Consulting, LLC, an electronic payments consultant. What's in it for you?
Less contact is more
According to the report "Market Opportunities
in Telecom-Based Payments" from NXP, you could use the contactless credit
card/cell phone combo to:
Contactless phones make possible some more-exotic payment paradigms, such as scanning signs and billboards with embedded computer chips. Do you absolutely have to have that trip to Aruba you see on the billboard? Scan in the information into your phone, buy the ticket on the spot via the mobile Internet and you're on your way to vacation paradise.
The Oregon State Department of Transportation
is conducting a pilot test designed to demonstrate the technical and
administrative feasibility of implementing an electronic collection system for
mileage-based user fees and congestion tolls. The on-board technology was
demonstrated in May of 2004. According to the current schedule, 20 trial
vehicles will be equipped with the on-board devices in February and March of
2005. In the summer of 2005, after verifying successful functionality, 280
trial participants in
In 1975,
Relief for Rush Hour: Pay as You Go
The New York Times, August 9, 2001, p. F6
By WAYNE ARNOLD
Anyone driving to
Congress, he added, is "a little slow to
the party," which is another way of saying that municipal and regional
officials, feeling the heat from traffic-weary voters, are leading the way. In
the
Thomas C. Lambert, who runs the program, said it boils down to putting a price on access, an approach that has not only generated revenue but also helped stimulate a 13.9 percent increase in car-pooling since it was adopted two and a half years ago.
Critics say such tolls yield Lexus lanes, but
in
"`On-time lanes' would be a better
term," said Dr. Janusz Supernak, a
Access to an eight-mile segment of Interstate 15, a popular commuter route to San Diego, is free to those in car pools; all others must install transponders (or readers) in their vehicles and pay fees that run from 50 cents to $4 a trip – or upward of $2,000 a year. The fee is based on traffic density, which is relayed to the transponders by electronic detectors in the pavement. The system works so well that delays are rare, and significant numbers of people have either converted to car pools or started commuting off peak. Revenues underwrite a commuter bus service.
Environmentalists take "a nuanced
view" of road pricing, Mr. Replogle said, because it often takes so much
uncertainty out of commuting that it stimulates sprawl. That was an effect in
Here in
It seems to work: while Asian capitals like
Under the electronic system, all cars, trucks and motorcycles are required to carry transponders that pick up signals from gantries positioned over the main roads leading downtown. The smart card, treated to withstand the tropical heat, is slipped into the transponder on the dashboard. As the vehicle passes under a gantry, the transponder deducts a toll from the card; the driver doesn't even have to slow down. If the card does not have enough remaining credit or is not installed properly, a camera in the gantry snaps a shot of the rear license plate and a fine is issued by mail.
The goal is to keep traffic flowing between 28 and 40 miles per hour on highways and between 12 and 19 m.p.h. on main thoroughfares – speeds that engineers here calculated would keep vehicles moving as efficiently as possible.
Traffic flow is monitored by a global positioning system that is also used to dispatch taxis. Every three months, the transportation authority decides whether prices need tweaking to discourage driving at certain times, said Chin Kian Keong, senior manager of public transport and road pricing. If speeds are too high, charges may be reduced.
Some businesses naturally balk. "If you have a fleet of trucks, going in and out can be quite expensive," said Tham Hock Chee, secretary- general of the Singapore Confederation of Industries. And other critics say taxis are disappearing downtown because cabbies are loath to pay for the opportunity to cruise.
Some drivers protest by "forgetting" to insert their card in the reader. Others go to great lengths to beat the system. One motorcyclist was photographed with his hand over his rear license plate. Some drivers have pulled onto sidewalks or shoulders to evade detection. The police identify about 1,000 violations a day, Mr. Chin said, imposing $5 fines on top of the toll.
Traffic during the morning rush hour has fallen 13 percent since the system was introduced in late 1997, and by 8 percent in the evening, Mr. Chin said. Drivers spent roughly $42 million to use the roads last year, a significant drop from what they paid under the daily pass system.
But more to the point are the savings they realized by climbing behind the wheel when other people were still asleep or at their desks. Mr. Lim and Mr. Chong, the early risers, say that between them they have banked almost $1,125 a year.
REVENUE, Revenue use from Transport
Pricing, is a research project financed by the European Commission
involving leading academic, national and private research centres and
consultancies, on the issue of the use of possible revenues from the
implementation of reforms on pricing policies in the transport markets. It
will:
·
Contribute
to the knowledge of the current institutions and practice of transport revenue
use around
·
Develop
guidelines for a good revenue use in the presence of social marginal cost
pricing on the basis of sound economic theory.
·
Test
the guidelines on a large set of case studies.
For information see the report, “State of the Art and Conceptual Background” (www.revenue-eu.org/deliverables.htm), 2004.
The report Pricing European Transport Systems (PETS), funded by the European Commission, describes several case studies that were modeled, including several interregional, and two urban traffic management programs to control traffic congestion, crash risk and pollution emissions.
In early 2002 the City of
To use this system:
1. User goes to the pay station.
2. Pays by coin, credit, debit or smart cards.
3. Takes the sticker receipt back to their car and places on the dashboard.
The city originally planned to phase these meters in over five years, but has accellerated this to three years due to srtong public acceptance and and cost efficiency. In 2002 about 150 stations were in place, in 2003 another 885 were added and now about 1,130 stations are in place. Each serves an average of 6.7 parking spaces. Over 55% of parking transactions are with credit or debit cards and about 1% with smart cards. This is particularly beneficial for longer-term users, who would have needed almost half a roll of quarters to pay for parking. The sidewalk space created by removal of parking meter posts has been favorably received by streetside business (cafes and bistros) as about 2-3 feet of sidewalk space was reclaimed.
The city devoted considerable attention to developing the station’s two-way communication system, which allows individual stations to report when they are nearly full or need maintenance. The stations typically jam about once a year, compared with about 4 times per year for coin meters. Automated recording systems imporve revenue management and security. Enforcement staff efficiency has increase with imporved system managmeent based on electonic hand-held ticket writing devices, similar to a PDA. These efficiency gains have increased net revenue, from about $7.5 million in 2001/02 to about $9.7 million in 2004/05.
Table 4 summarizes key features of recent urban road pricing programs and their payment systems. ANPR refers to automatic numberplate reading using cameras to record vehicle licenses, and DSRC refers to and dedicated short-range communication using electronic systems to track vehicles travel within a specific area.
Table 4 Summary of Urban Road Pricing (EIU, 2006)
|
|
|
|
|
|
|
Objective |
Optimise the usage of road infrastructure |
Fund new road and public transport infrastructure projects |
Reduce congestion and fund investments in the
|
Reduce congestion, improve the environment and fund increased public transport |
|
Pricing scheme |
€0-2 per inbound trip; variable charge Monday-Friday 7.30-19.00 |
€1.5 per inbound trip; flat rate all days |
€8-10 area charge per day, flat rate Monday- Friday 7.00-18.30 |
€1-2 per in- and outbound trip; variable charge Monday-Friday |
|
Identification method |
98% DSRC |
90% DSRC |
100% ANPR |
50% DSRC 50% ANPR |
|
Payment |
Automatically deducted from pre-pay account |
Most drivers pay via Autopass electronic payment collection system |
Before midnight the day of passage, by SMS or Internet, or in shops |
Within 14 days from the date of passage, in shops or banks or by Internet |
|
Annual Revenue |
€40m |
€150m |
€122m (net) |
€85m |
|
Future |
GPS-based system in consideration, geographical expansion |
Full payment automation, extension and variable pricing scheme considered |
Western extension, DSRC pilot project |
Trial to be extended and revenue used to fund bypass construction |
The PhotoViolationMeter (PVM) parking meter uses a combination of sensors, photography, and wireless technology to be self-enforcing and provide motorists with user-friendly payment features. The system can issue parking violations that include a digital image of a violation, assisting in the prevention of manual input errors, and will drastically cut down on violation disputes and court time. This parking meter is easy to use, fair, and permits municipalities to keep parking rates low by increasing revenue through compliance.
User have the option of paying by coin (multiple-currency accepted), phone, debit, credit card, or smart card, right at their vehicle. Features include a No-Fine option, Grace Periods and Instant Notifications. The No-Fine feature gives drivers the option to simply swipe a credit card and the PVM incrementally adds time to the meter, billing the credit card as time passes, and stops billing the minute the vehicle pulls away. The Grace Period feature is available to drivers who are running late, allowing payment at the meter for expired time, rather than receiving a violation. If they cannot return within the Grace Period, they have the option to pay for violations at the meter for a discounted fine. Additionally, the Instant Notification feature notifies the driver of, and prevents payment for, rush hour and no-parking conditions, preventing user vehicles from being towed. The option to add time remotely by phone, eliminating any third party provider fees, is already integrated into the PVM, and surpasses stand-alone pay-by-phone systems. Features such as these ensure drivers pay for the time they use, no more, no less.
To promote public transit use through more accurate price signals,
the
In addition to
creating better financial incentives for individuals to drive and park less,
the parking meters are advantageous to the broader campus community. The
personal meters collect valuable data regarding the use of specific parking
areas for use by university planners. The in-car meters also eliminate the need
for traditional meters and pay machines on campus, improving the visual
landscape.
More than 600
Smart Parking Meters are now in use at the University. According to initial
estimates by the partners, participation by 500 employees who curtail driving
by one day per week can reduce VMT by 350,000 miles per year. In practice,
demand for participation in the personal parking meter program has been much
higher than projected, suggesting that larger benefits may be possible.
Various mobile
payment systems use mobile device such as mobile telephones and Personal
Digital Assistants (PDAs) to pay for goods or services, including public
transit fares, parking and road tolls. Some systems use Near Field
Communication (NFC) and Radio-frequency identification (RFID) to automate the
transactions, so users simply swipe their telephones or PDAs.
Starting February
2005 San Jose, California became the first North American city to use e-purse
technology for parking payments using the Parcxmart smart cards. This is the first
time in the
John Regan,
President and CEO of Parcxmart Technologies said, “This technology offers a
turnkey payment system for municipal parking operators and their parking public
who want an alternative to coins and cash. There are no consumer transaction
fees for our products making for easy and convenient consumer acceptance.
Corporations also enjoy its convenience and our highly customized online
transaction detail reporting for audit and control purposes. By removing coins
from the collection process, cities have greater control over revenue growth.
Full integration into Pay and Display will be completed in 2005 and we will be
operating in 8 major cities by year-end.”
Europolis
2000,
Parking is
probably the most important problem facing local governments in
The public will be
able to pay for parking by electronic money at SchlumbergerSema on-street
parking terminals or directly from their cars using Europark, the
ACICONSULT-developed in-car unit. The Europark unit is placed inside car. It measures
the duration of parking and using a smart card it calculates and pays the
relevant amount directly from the car through a smart card e-purse. This is a
real individual car meter which works for any type of paid car parking. The
card can also be used with parking terminals which issue tickets and receipts
to be left inside the vehicle (pay-and-display).
The technology
developed by TSP will allow the integration of all urban service payment collection
systems, enabling a real ‘citycard’ to be produced that provides true
convenience and service to users. The card can incorporate season tickets and
prepayments in line with the commercial and service policies of local managers,
allowing the inclusion of customer loyalty schemes and promotions. For
managers, the e-purse and electronic season ticket represents new sources of
profit, guaranteeing lower costs compared to manual management of cash,
particularly with the imminent introduction of the Euro. The use of a
rechargeable smart card finally means managers can eliminate the high costs
incurred producing alternative parking management methods, such as magnetic
strip cards, paper vouchers, parking scratch cards etc.
APTA, Fare Collection Web Sites (www.apta.com/sites/business/farecoll.htm) American Public Transportation Association.
BU (2007), Pay for Transit Using Your Phone: Sprint,
J.B. (Jens) Buurgaard Nielsen (2005), Technology for Pricing Policy - Experiences With Current Schemes, CE Delft (www.ce.nl/eng/redirect/thema_pricing_index.html).
CarFax (www.carfax.com) is a commercial service that provide mileage data on individual vehicles, which can be used for distance-based pricing analysis.
CFIT (2002), Paying For Road Use, Commission for Integrated Transport (www.cfit.gov.uk/reports/pfru/index.htm).
Congestion Pricing Bibliography, (www.hhh.umn.edu/centers/slp/conpric/bib.htm).
David N. Cottingham, Alastair R. Beresford and
Robert K. Harle (2007), “A Survey of Technologies for the Implementation of
National-Scale Road User Charging,” Transport
Reviews, Volume 27, Issue 4 (www.informaworld.com), July 2007, pp. 499 – 523.
CUPID (Co-ordinating Urban Pricing Integrated Demonstrations) (www.transport-pricing.net) is funded by the European Commission which aims to promote state of the art knowledge on urban transport pricing schemes.
ECMT (2006), Road Charging Systems – Technology Choice And Cost Effectiveness, European Conference of Ministers of Transport (www.cemt.org); available at www.cemt.org/topics/taxes/Paris06/Conclusions.pdf.
EIU (2006), Driving Change: How Policymakers Are Using Road Charging To Tackle Congestion, Economist Intelligence Unit (http://graphics.eiu.com/files/ad_pdfs/eiu_ibm_traffic_wp.pdf)
ETTM (Electronic Toll Collection and Traffic Management) (www.ettm.com) website provides information on vehicle tolling technology and applications, including a comprehensive summary of major North America toll roads and bridges (www.ettm.com/usafac.html).
European Transport Pricing Initiative (www.Transport-Pricing.Net)
provides information on transportation pricing research and pilot projects
being implemented in
EXPO1000, Parking Industry Guide, EXPO1000 (www.expo1000.com/parking) is a comprehensive catalogue of products and services related to parking.
Fare Collection Web Sites (www.apta.com/sites/business/farecoll.htm) by the American Public Transportation Association, provides information on new approaches to collecting transit fares.
FHWA (2007), Advanced Parking Management Systems: A Cross-Cutting Study, Report FHWA-JPO-07-011, Intelligent Transportation Systems (www.its.dot.gov), FHWA, USDOT; available at www.its.dot.gov/jpodocs/repts_te/14318.htm.
David Forkenbrock (2000), A New
Approach to Assessing Road User Charges,
David J. Forkenbrock and Jon G. Kuhl (2004), A New Approach to Assessing Road User Charges, Public Policy Center, University of Iowa (http://ppc.uiowa.edu/trans20.html).
FTA (1996),
Tech Brief: Smart Fare Payment Systems For Public Transit,
Innovative Finance for Surface Transportation (www.innovativefinance.org) is an Internet based clearinghouse providing information on innovations in road pricing and user fees.
Invers Traffic Telematics Systems (www.invers.com/en) provides automated carshare booking and billing systems.
iPaid (www.ipaid-insurance.com) is a technology system that enables "pay as you drive" insurance.
IPI (annual publications), Electronic Buyers Guide, International Parking Institute (www.parking.org).
IRIS (www.payd-insurance.com) by International Research and Intelligent Systems offers a fully integrated Pay as You Drive insurance, road pricing and parking pricing systems.
ITS International (www.itsinternational.com) provides information in Intelligent Transportation System technologies, some of which apply to road pricing.
ITS World (www.itsonline.com/traftech2.html) provides information in Intelligent Transportation System technologies, some of which apply to road pricing.
IVOX (www.ivoxdata.com/ivox.htm) uses various GPS and GIS data systems to track vehicle travel patterns and use the information to calculate insurance premiums.
David S. Kim, David Porter and Robin
Wurl (2002), Technology Evaluation For Implementation Of VMT Based Revenue
Collection Systems Final Report, Department of Industrial and Manufacturing
Engineering, Oregon State University, for t he Oregon Department of Transportation
Road User Fee Task Force (www.odot.state.or.us/ruftf/pdfs/OSU_Final_Report.pdf).
J.Y.K. Luk (1995), Technologies
for On-Street Parking,
Per Kågeson and Jos Dings (1999), Electronic Kilometre Charging for Heavy Goods Vehicles in Europe, European Federation for Transport and Environment (www.t-e.nu).
Todd Litman (1999), Distance-Based Charges; A Practical Strategy for More Optimal Pricing, VTPI (www.vtpi.org). An earlier version of this paper was presented at the Transportation Research Board Annual Meeting, January 1999.
Robb Montgomery (2008), Paying for Mass Transit and Parking with Your Mobile Phone in Zagreb, Robb Montgomery Consulting (www.robbmontgomery.com/home/2008/newspaper/design/02/video-paying-for-mass-transit-with-your-mobile-phone).
MultiSystems (2003), Fare Policies, Structures, and Technologies: Update, Report 94, Transit Cooperative Research Program (TCRP), Transportation Research Board (www.trb.org); available at http://gulliver.trb.org/news/blurb_detail.asp?id=1955.
NALGEP (2005), Clean Communities on the Move: A Partnership-Driven Approach to Clean Air and Smart Transportation, National Association of Local Government Environmental Professionals (NALGEP), (www.nalgep.org).
OCTO telematics (www.octotelematics.com/octo/old_new/index_en.htm) provides GPS-based vehicle location systems used for insurance pricing.
ParkPlus (www.parkplus.ca) is an automated, zone-based parking payment system that eliminates the need for individually-marked curb spaces, which increases the number of vehicles that can be parked in an area. Payments can be made at terminals or by telephone.
PETS (2000), Pricing European Transport Systems; Final Report, Institute of Transport Studies, University of Leeds, European Transport Pricing Initiative (www.Transport-Pricing.Net), funded by the European Commission.
Andrew T.W. Pickford and Philip T. Blythe (2006), Road User Charging and Electronic Toll Collection, Artech House (www.artechhouse.com).
Richard H. Pratt (1999), Traveler Response to Transportation System Changes, Interim Handbook, TCRP Web Document 12 (www4.nationalacademies.org/trb/crp.nsf/all+projects/tcrp+b-12), DOT-FH-11-9579.
PT (2001), “Pay by Space and Pay & Display” Parking Today (www.parkingtoday.com), April 2001, pp. 42-44.
REVENUE (www.revenue-eu.org), Revenue use from Transport Pricing, concerning the use of transportation pricing reform revenues For information see, State of the Art and Conceptual Background (www.revenue-eu.org/deliverables.htm), 2004.
ROCOL (2000), Road Charging Options for London: A Technical Assessment, Government Office For London (www.go-london.gov.uk/transport/publications/rocol.asp).
SCA (2001), Heavy Vehicle Fee, Swiss Customs Agency (www.zoll.admin.ch).
Amir Sedadi (2006), Parking Technology in Pasadena, California, ITE Annual Meeting (www.ite.org).
John Shaw (1997), Planning for Parking,
SkyBitz (www.skybitz.com) provides GPS technology.
SkyMeter (www.skymetercorp.com) is a vehicle location billing system that can be used for road, parking and insurance pricing.
Smart Card
T&E (2000), Counting the Kilometres - And Paying for Them; How to Introduce an EU Wide Kilometre Charging System, European Federation for Transport and Environment (www.t-e.nu).
TRB (2006), The Fuel Tax And
Alternatives For Transportation Funding, Special Report 285, Committee for
the Study of the Long-Term Viability of Fuel Taxes for Transportation Finance,
Transportation Research Board (www.trb.org);
available at http://onlinepubs.trb.org/onlinepubs/sr/sr285.pdf.
USDOT, Intelligent
Transportation System Website (www.its.dot.gov)
provides information on
USEPA (1999), Parking Alternatives: Making Way for Urban Infill and Brownfield Development, Urban and Economic Development Division, US Environmental Protection Agency, EPA 231-K-99-001 (www.smartgrowth.org/pdf/PRKGDE04.pdf).
Value
Pricing and Congestion Pricing Website (www.valuepricing.org), Hubert H.
Humphrey Institute of Public Affairs at the
Duco van Dijk and Ton Sledsens (2000), Effectiveness and Feasibility of Advanced Kilometre Charging, The Netherlands Society for Nature and Environment (www.snm.nl).
Herbert Weinblatt, et al (1999), Alternative Approaches to Taxation of Heavy Vehicles, NCHRP Report 416, Transportation Research Board (www.trb.org).
Wikipedia (2008), Mobile Payment Systems (http://en.wikipedia.org/wiki/Mobile_payment).
This Encyclopedia is produced by the Victoria Transport
Policy Institute to help improve understanding of Transportation Demand
Management. It is an ongoing project. Please send us your comments and
suggestions for improvement.
Victoria Transport Policy
Institute
www.vtpi.org info@vtpi.org
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