In late April, President Obama took an executive action that had been ignored for a decade, and sent a surface transportation bill to Congress. The 4-year, $302 billion GROW AMERICA act would take numerous measures to shore up current transportation underfunding. There is much inside the bill that might be contentious for Republicans and Democrats, given their differing preferences on the proper federal role in transportation. But one provision should be broadly endorsed: lifting the interstate toll ban.
The act would allow states to toll their own stretches of interstate, something that has been forbidden for a century. This would let states finally explore an option that could ease congestion and increase revenue, while better enabling local autonomy.
Since 1916, there has, except in rare cases, been an effective ban on interstate tolls. They are allowed on a few stretches, mostly along the East Coast, and because of recent Congressional provisions, can be applied to new lanes that are added to existing interstates, or to automobiles in HOV lanes that carry below the minimum required capacity. But the conversion into full tollways is still rare on the 46,876-mile system. One pilot program allows this for certain stretches, but only three states can join, and the approval process is lengthy, and comes with stipulations on how revenue can be spent.
Discouraging tolls is inspired by America's tradition of keeping the interstates “free,” so as to enable citizens' mobility. But because population growth has remained disproportionately higher than highway growth, this has produced a tragedy of the commons.
Take, for example, the congestion problem. According to a CBO report, the number of highway lane miles has remained mostly static since the 1980s, while the number of vehicle miles traveled has almost doubled. This would explain the congestion now affecting many stretches of interstate, particularly in major metro areas. Parts of I-95 around Washington, D.C, and New York City, for example, can take over 30 minutes just to navigate a dozen miles, and similar conditions are found on interstates in other cities. The costs that this imposes on commuters in time and money have already compelled many people to relocate closer in, and added toll fees would likely strengthen the trend.
Tolling would also create revenue to add interstate road capacity and address under-maintenance, which Reason Foundation scholar Robert Poole claims could soon become expensive.
“Major highways, even if properly maintained, have a design life of about 50 years,” he wrote for U.S. News and World Report. “Over the next decade, a large fraction of the interstate system will reach age 50 or more.”
This, he explains, could create repair costs of $3 trillion, a figure that far exceeds existing revenue sources. Currently, interstate growth and repairs are handled through an 18.4cents/gallon federal gas tax that goes into the Highway Trust Fund. But as the Department of Transportation recently announced, the fund could be insolvent by this summer, since rising fuel-efficiency standards have reduced consumption, bringing annual receipts down to $40 billion. In response, Congress has recently used general fund revenue to patch up the highway fund. Allowing tolls would be a more reliable long-term option.
The loudest criticism against them comes from the Alliance For Toll-Free Interstates, a business coalition that includes FedEx, McDonalds, and the American Trucking Associations. Tolling interstates is undesirable, they claim, because it would hurt nearby businesses and make transport more expensive, raising the price of consumer goods. Other commentators from both right and left dislike the cost-of-living increases that tolls could exact on poorer households.
But if America is to have a functioning interstate system, revenue must come from somewhere, and generating it will mean imposing costs on American citizens regardless. The question is—what is the best way to do this?
One way would be to drastically increase the gas tax, but there have always been strong cases made against this. For one thing, the method generates revenue from the very commodity—oil—that the government is also trying to wean people of. This means that revenues from it will likely continue declining no matter what, making it an unreliable funding source. The gas tax is also a less direct form of payment, since it is levied even on people who mostly use state and local roads, thus subsidizing heavy interstate users. Tolling, meanwhile, brings accountability by charging people directly for their interstate usage.One idea for comprehensive tolling comes from Poole, who has become America's de facto champion for toll roads. Last year he outlined a plan for a nationwide system that would generate interstate revenue more equitably than the existing approach. Each time an automobile used an interstate highway, it would be electronically charged so as to avoid the backup caused by toll booths. The standard rate, adjusted annually for inflation, would start at 3.5cents/mile. Over several decades, this would pay for the $1 trillion electronic system, and then for future repairs. The tolls would be required to fund only interstates, unlike the gas tax, which goes towards numerous alternative measures. And it would be surprisingly cheap—trips would cost $7.50 between New York City and Boston, $13.34 between Los Angeles and San Francisco, and a buck and change for the Baltimore-to-DC commute (compare this to the Port Authority's $11 fee for entering Manhattan from across the Hudson). Not only would these modest fees raise revenue, but they would better assuage the concerns voiced by advocates of both the poor, and of businesses.
That said, Poole's plan amounts more to a thought experiment, given how holistic and politically unlikely it is today. In comparison, the White House's proposed legislation is more incremental, and is based more on allowing states to determine their own tolling policies, over crafting a national plan.
“We believe,” said Transportation Secretary Anthony Foxx, “that this is an area where the states have to make their own decisions.”
Such autonomy would be welcome after a half-century of federally-dominated interstate policy, which has forced states to deal with Congressional gridlock and underfunding. The authority to toll would let them generate their own revenue, rather than relying on an increasingly-weak gas tax. And it would let them experiment with numerous innovations—from HOT lanes to electronic systems—that are being tried elsewhere, but have long been discouraged by the federal government. For this and other reasons, Obama's interstate tolling proposal should draw rare bipartisan consensus.
[This article was originally published by Forbes]