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Road PricingRoad Pricing
Anthony M. RufoloAnthony M. RufoloSystems Science SeminarSystems Science Seminar
May 7,2010May 7,2010
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Perceived Need To Replace Fuel Perceived Need To Replace Fuel TaxesTaxes
Concern About Alternative Fuel Concern About Alternative Fuel VehiclesVehicles
Current Revenue Not AdequateCurrent Revenue Not Adequate Resistance To Fuel Tax IncreasesResistance To Fuel Tax Increases Pricing Could Help Manage DemandPricing Could Help Manage Demand But Imposing Prices Is CostlyBut Imposing Prices Is Costly
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Federal43%
State34%
Local23%
FY 2006 Highway Capital Funding Sources
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HTF Receipts By CategoryHTF Receipts By Category
0%
20%
40%
60%
80%
100%
1957
1960
1963
1966
1969
1972
1975
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2008
Con
stant
$ (M
illion
s)
Gas Diesel Non-Fuel
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Mileage Fee ExperimentMileage Fee Experiment
Oregon Department of Oregon Department of Transportation (ODOT) Tested a Transportation (ODOT) Tested a System to Replace State Gas Tax System to Replace State Gas Tax With Mileage FeesWith Mileage Fees
When Fueling at a Participating When Fueling at a Participating Station, System Subtracts Gas Tax Station, System Subtracts Gas Tax And Adds Mileage FeeAnd Adds Mileage Fee
Other Vehicles Still Pay Gas TaxOther Vehicles Still Pay Gas Tax
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Basic SystemBasic System
GPS Used To Allow On Board Unit To GPS Used To Allow On Board Unit To Determine Time And Location Of Determine Time And Location Of TravelTravel
Up To 30 Time And Location ZonesUp To 30 Time And Location Zones All Miles Driven Allocated To A ZoneAll Miles Driven Allocated To A Zone Could Be Different Fee For Each ZoneCould Be Different Fee For Each Zone All Data Stored In VehicleAll Data Stored In Vehicle
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Data TransferData Transfer
When Fueling, Vehicle Communicates When Fueling, Vehicle Communicates With Pump Via Radio SignalWith Pump Via Radio Signal
In Baseline, Mileage Data By Zone In Baseline, Mileage Data By Zone UploadedUploaded
In Experiment, State Gas Tax In Experiment, State Gas Tax Deducted And Mileage Fee Added At Deducted And Mileage Fee Added At The PumpThe Pump
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BaselineBaseline
Two Service Stations Equipped With Two Service Stations Equipped With TechnologyTechnology
Volunteers Recruited Who Lived Or Volunteers Recruited Who Lived Or Worked Near The StationsWorked Near The Stations
Vehicles Equipped With DevicesVehicles Equipped With Devices Approximately 4.5 Months Of Baseline Approximately 4.5 Months Of Baseline
Data Collected On Driving By ZoneData Collected On Driving By Zone Participants Instructed To Regularly Use Participants Instructed To Regularly Use
Participating StationsParticipating Stations
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ExperimentExperiment
At Midpoint, Participants Assigned To At Midpoint, Participants Assigned To One Of The Three GroupsOne Of The Three Groups
Data Collected For About Another 4.5 Data Collected For About Another 4.5 MonthsMonths
For Experiment Groups, Gas Tax For Experiment Groups, Gas Tax Deducted And Mileage Fee Added At Deducted And Mileage Fee Added At Participating StationsParticipating Stations
Participants Were Reimbursed For Participants Were Reimbursed For State Gas Tax Paid At Other StationsState Gas Tax Paid At Other Stations
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ObjectivesObjectives
Test Functioning Of Equipment In Test Functioning Of Equipment In Vehicles And At PumpsVehicles And At Pumps
Identify Problems With Using The Identify Problems With Using The System For Users Or StationsSystem For Users Or Stations
Evaluate Behavioral Responses To Evaluate Behavioral Responses To Flat VMT FeeFlat VMT Fee
Evaluate Behavioral Responses To Evaluate Behavioral Responses To Congestion PricingCongestion Pricing
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Not RandomNot Random
The Sample Was Not RandomThe Sample Was Not Random All VolunteersAll Volunteers
– Must Be Able To Fuel At Participating Must Be Able To Fuel At Participating Stations At Least Twice Per MonthStations At Least Twice Per Month
– All Vehicles In Household Must All Vehicles In Household Must Participate And Be 1996 Or NewerParticipate And Be 1996 Or Newer
– $300 Or More Per Vehicle In Incentive $300 Or More Per Vehicle In Incentive PaymentsPayments
– No Motorcycles Or Diesel Vehicles In No Motorcycles Or Diesel Vehicles In HouseholdHousehold
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Location of Study Participants and Location of Study Participants and Service StationsService Stations
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Volunteers RecruitedVolunteers Recruited
Installation Of On Vehicle Devices Installation Of On Vehicle Devices Occurred Between June 14,2006 and Occurred Between June 14,2006 and July 11, 2006July 11, 2006
Initial Sample Was 201 HouseholdsInitial Sample Was 201 Households But Useable Data From 168 But Useable Data From 168
Households With 207 VehiclesHouseholds With 207 Vehicles
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Experiment BeginsExperiment Begins
In November 2006, Households Were In November 2006, Households Were Assigned To One Of The Three Experiment Assigned To One Of The Three Experiment Groups: Control, Mileage Fee (VMT), Or Groups: Control, Mileage Fee (VMT), Or Congestion Pricing (RH)Congestion Pricing (RH)
Given An Endowment Account Based On Given An Endowment Account Based On Baseline Driving And Price SystemBaseline Driving And Price System
Mileage Fees Deducted From Endowment Mileage Fees Deducted From Endowment And Any Remainder Paid At EndAnd Any Remainder Paid At End
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VMT FeeVMT Fee
The Basic System Tested Was A Simple The Basic System Tested Was A Simple Vehicle Miles Traveled (VMT) FeeVehicle Miles Traveled (VMT) Fee
Charge of 1.22 Cents Per Mile Traveled In Charge of 1.22 Cents Per Mile Traveled In Oregon (On Average Equal To State Gas Oregon (On Average Equal To State Gas Tax) And Refund Of Gas TaxTax) And Refund Of Gas Tax
No Charge For Miles Outside Of OregonNo Charge For Miles Outside Of Oregon No Refund Of Other State Gas TaxesNo Refund Of Other State Gas Taxes
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Congestion ChargeCongestion Charge
Value Pricing Program Provided Value Pricing Program Provided Funding And Congestion Charges Funding And Congestion Charges Added As Part Of TestAdded As Part Of Test
10 Cents Per Mile For Travel In 10 Cents Per Mile For Travel In Congestion Zone During Weekday Congestion Zone During Weekday Rush Hours (7-9 a.m., 4-6 p.m.)Rush Hours (7-9 a.m., 4-6 p.m.)
0.43 Cents Per Mile For Other Travel 0.43 Cents Per Mile For Other Travel In OregonIn Oregon
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Rush Hour ZoneRush Hour Zone
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Control GroupControl Group
No Change From Baseline-Continue No Change From Baseline-Continue To Fuel At Stations But Pay Price To Fuel At Stations But Pay Price Including State Gas TaxIncluding State Gas Tax
Intended To Control For Seasonal Intended To Control For Seasonal Effects, Changes In Price Of Gasoline, Effects, Changes In Price Of Gasoline, And So OnAnd So On
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Data Collection DesignData Collection Design
Mileage By Zone Collected Whenever Mileage By Zone Collected Whenever Vehicle Was Fueled At A Participating Vehicle Was Fueled At A Participating StationStation
Data Collected At Independent Data Collected At Independent Reader Station To Mark Beginning, Reader Station To Mark Beginning, Midpoint, And End Of StudyMidpoint, And End Of Study
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Data Collection RealityData Collection Reality
Reported Reads Varied Between 66% Reported Reads Varied Between 66% And 88% Of Detected Vehicles By And 88% Of Detected Vehicles By Station By Month During Baseline Station By Month During Baseline
Could Be Problems With Data Could Be Problems With Data Transmission, Drive By, Or Stop For Transmission, Drive By, Or Stop For Other PurchasesOther Purchases
Problems With Independent Reader Problems With Independent Reader Either Due To Failure To Try Or Either Due To Failure To Try Or Failure To Transmit DataFailure To Transmit Data
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Problems CreatedProblems Created
Less Than Half Of Control Group Less Than Half Of Control Group Provided Useable DataProvided Useable Data
Vehicles Spent Varying Amounts Of Vehicles Spent Varying Amounts Of Time In Baseline And ExperimentTime In Baseline And Experiment
New Change In Daylight Savings New Change In Daylight Savings Time Was Not Programmed Into The Time Was Not Programmed Into The Units, So Rush Hour Changed On Units, So Rush Hour Changed On March 11, 2007March 11, 2007
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Responses To ProblemsResponses To Problems
Data Calculated As Miles Per Day And Data Calculated As Miles Per Day And RH Miles Per Weekday To Account RH Miles Per Weekday To Account For Varying Times Of ParticipationFor Varying Times Of Participation
Data Analyzed For Experiment Data Analyzed For Experiment Ending On March 11, 2007 And For Ending On March 11, 2007 And For Experiment Ending On April 1, 2007Experiment Ending On April 1, 2007
Data Analyzed By Vehicle And By Data Analyzed By Vehicle And By HouseholdHousehold
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Group SizeGroup Size
Control Group Was Intended To Be Control Group Was Intended To Be 27 Vehicles (About 10%), But Only 10 27 Vehicles (About 10%), But Only 10 Provided Useable DataProvided Useable Data
VMT Group Ended With 95 Vehicles VMT Group Ended With 95 Vehicles Providing Useable DataProviding Useable Data
RH Group Ended With 102 Vehicles RH Group Ended With 102 Vehicles Providing Useable DataProviding Useable Data
Control Group Results Not Control Group Results Not Statistically SignificantStatistically Significant
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Average Mileage Per VehicleAverage Mileage Per Vehicle
ControlControl VMTVMT RHRH
Base Base RH/WKDYRH/WKDY
7.507.50 4.674.67 8.418.41
BaseBase
OR/DayOR/Day23.6123.61 22.8322.83 30.9230.92
ExpExp
RH/WKDYRH/WKDY8.688.68 5.255.25 7.317.31
ExpExp
OR/DayOR/Day22.6422.64 20.8820.88 26.5126.51
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Change In RH Miles Per WkdyChange In RH Miles Per Wkdy
MeanMean T-RatioT-Ratio % Change% Change
ControlControl 1.181.18 1.081.08 15.7215.72
VMTVMT 0.590.59 2.122.12 12.5412.54
RHRH -1.10-1.10 -3.63-3.63 -13.08-13.08
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Change In OR Miles Per DayChange In OR Miles Per Day
MeanMean T-RatioT-Ratio % Change% Change
ControlControl -0.97-0.97 -0.58-0.58 -4.10-4.10
VMTVMT -1.96-1.96 -2.93-2.93 -8.57-8.57
RHRH -4.41-4.41 -4.48-4.48 -14.25-14.25
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ResultsResults
VMT Reduced Mileage Relative To VMT Reduced Mileage Relative To Control But Increased Rush Hour Control But Increased Rush Hour MileageMileage
Not Statistically Significant, But Not Statistically Significant, But Survey And Focus Groups Found Survey And Focus Groups Found Participants Stating That They Participants Stating That They Reduced MileageReduced Mileage
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Congestion Pricing ResultsCongestion Pricing Results
Paired Means Shows About 13% Paired Means Shows About 13% Reduction In Peak MilesReduction In Peak Miles
Further Reduction In Off-Peak Miles Further Reduction In Off-Peak Miles Rather Than A Shift To Off-PeakRather Than A Shift To Off-Peak
Reflects A Pure Price Effect Since Reflects A Pure Price Effect Since There Was No Change In Congestion There Was No Change In Congestion For This GroupFor This Group
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Effect Of Price On Mode ChoiceEffect Of Price On Mode Choice
12 Of 84 Households In RH Reported 12 Of 84 Households In RH Reported Someone In Household Changing Someone In Household Changing Mode To Save MoneyMode To Save Money
10 Of 79 Households In VMT 10 Of 79 Households In VMT Reported This As Well Although On Reported This As Well Although On Average The VMT Fee Was Equal To Average The VMT Fee Was Equal To The Gas TaxThe Gas Tax
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Effect Of Congestion Charge On Effect Of Congestion Charge On TravelTravel
26 Of 84 RH Households Reported 26 Of 84 RH Households Reported Changes In Either Time Or Distance Changes In Either Time Or Distance TraveledTraveled
23 By Avoiding Driving During Rush 23 By Avoiding Driving During Rush HourHour
4 Reported Consolidating Trips And 4 Reported Consolidating Trips And One Joined A CarpoolOne Joined A Carpool
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Response To Fee SystemResponse To Fee System
145 of 163 Households (91%) Would 145 of 163 Households (91%) Would Be Willing To Stay With System If All Be Willing To Stay With System If All Service Stations ParticipatedService Stations Participated
Response Drops To 105 (64%) Who Response Drops To 105 (64%) Who Think Other People Would Be Willing Think Other People Would Be Willing To Use The SystemTo Use The System
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CaveatsCaveats
Self-Selected SampleSelf-Selected Sample Effects Of Being In An ExperimentEffects Of Being In An Experiment Limited DurationLimited Duration Congestion Price Is Per Mile But Does Congestion Price Is Per Mile But Does
Not Reflect Direction Of Travel Or Not Reflect Direction Of Travel Or Other Differences In Actual Other Differences In Actual CongestionCongestion
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AccuracyAccuracy
OSU determined that readings from OSU determined that readings from system deviated as much as 20% system deviated as much as 20% from odometer readingsfrom odometer readings
Some problems with zone boundariesSome problems with zone boundaries Many missed reads at the pumpMany missed reads at the pump
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CostCost
Retrofit would be expensive, so Retrofit would be expensive, so phase in with new vehiclesphase in with new vehicles
Change station accounting softwareChange station accounting software Equip pumpsEquip pumps Accounting and billing systemAccounting and billing system
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Potential Use of Road PricingPotential Use of Road Pricing
Two Congressional Commissions Two Congressional Commissions Have Recommended Replacing Fuel Have Recommended Replacing Fuel Taxes With PricingTaxes With Pricing
But The Cost of Pricing is Much But The Cost of Pricing is Much Higher Than the Cost to Collect Fuel Higher Than the Cost to Collect Fuel TaxesTaxes
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Many Types Of PricingMany Types Of Pricing
Targeted Tolling and PricingTargeted Tolling and Pricing– TurnpikesTurnpikes– Bridges, Tunnels, And Related LinksBridges, Tunnels, And Related Links
Cordon PricingCordon Pricing Comprehensive PricingComprehensive Pricing
– Flat ChargeFlat Charge– Variable Based On Congestion, Variable Based On Congestion,
Emissions, Road DamageEmissions, Road Damage
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Cost IssuesCost Issues
Few Taxpayers Pay The Fuel Tax, But Few Taxpayers Pay The Fuel Tax, But There Could Be Millions Of Accounts With There Could Be Millions Of Accounts With PricingPricing
Technology May Be CostlyTechnology May Be Costly Cost To Manage Accounts And Enforce The Cost To Manage Accounts And Enforce The
SystemSystem Research Needed To Better Understand Research Needed To Better Understand
Cost Trends And Possibilities To Use Cost Trends And Possibilities To Use Technology Available For Other PurposesTechnology Available For Other Purposes
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Tolls With Closed SystemTolls With Closed System
Tolls paid at designated areas with Tolls paid at designated areas with barriers to entry/exitbarriers to entry/exit
Detection by toll gates, attendants, Detection by toll gates, attendants, police, and cameraspolice, and cameras
Advantage is low violation ratesAdvantage is low violation rates Disadvantages are cost, bottlenecks, Disadvantages are cost, bottlenecks,
and safety issuesand safety issues
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Tolls With Open SystemTolls With Open System
Vehicles equipped with transponders and Vehicles equipped with transponders and tolls are paid as the vehicle passes tolls are paid as the vehicle passes throughthrough
Detection is mostly camerasDetection is mostly cameras Advantage is higher throughput and Advantage is higher throughput and
revenue generationrevenue generation Disadvantages are higher violation rates Disadvantages are higher violation rates
and costs for transaction recognition, and costs for transaction recognition, violation processing, and courtsviolation processing, and courts
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Automatic Vehicle IdentificationAutomatic Vehicle Identification• Identify vehicles at fixed points• Wireless data/financial transaction via transponder/tag• Toll roads, tunnels, bridges, cordons• Video recognition of license plates for enforcement• London using high speed license plate matching only (no tags) for
cordon pricing
• Identify vehicles at fixed points• Wireless data/financial transaction via transponder/tag• Toll roads, tunnels, bridges, cordons• Video recognition of license plates for enforcement• London using high speed license plate matching only (no tags) for
cordon pricing
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Tolling in U.S.Tolling in U.S.
277 toll roads, bridges, or tunnels277 toll roads, bridges, or tunnels $9.3 billion in toll revenue in 2006$9.3 billion in toll revenue in 2006 Operating costs tend to be a high Operating costs tend to be a high
percentage of revenuepercentage of revenue
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Flat Versus Variable PricingFlat Versus Variable Pricing
Tolls That Do Not Vary Raise Tolls That Do Not Vary Raise Revenue But Do Not Manage The Revenue But Do Not Manage The Road SystemRoad System
Prices Based On The Level Of Prices Based On The Level Of Congestion Manage The Road Congestion Manage The Road System, But May Not Raise Desired System, But May Not Raise Desired RevenueRevenue
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Types Of Congestion ChargesTypes Of Congestion Charges
Congestion Charge Varied By Time, Congestion Charge Varied By Time, Location, And Distance Traveled Is Location, And Distance Traveled Is Most EfficientMost Efficient
Dutch Have Proposed Such A Dutch Have Proposed Such A System, But None Currently ExistSystem, But None Currently Exist
Facility And Area Systems Have Been Facility And Area Systems Have Been ImplementedImplemented
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Variable Toll FacilitiesVariable Toll Facilities
Growing Experience With High Growing Experience With High Occupancy Vehicle/Toll (HOT) LanesOccupancy Vehicle/Toll (HOT) Lanes
Generally Used For New Lanes Or Generally Used For New Lanes Or Underutilized HOV LanesUnderutilized HOV Lanes
Static And Dynamic Congestion Static And Dynamic Congestion Pricing Is UsedPricing Is Used
Some Use Of Variable Pricing On Some Use Of Variable Pricing On Previously Flat Toll FacilitiesPreviously Flat Toll Facilities
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Cordon or Area PricingCordon or Area Pricing
In use in other countriesIn use in other countries– SingaporeSingapore– LondonLondon– StockholmStockholm
Proposed for New York, but not Proposed for New York, but not implementedimplemented
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Cordon Pricing: SingaporeCordon Pricing: Singapore Demand management Demand management Initially, paper based system with Initially, paper based system with 31 checkpoints in morning peak 31 checkpoints in morning peak hourshours
Expanded to 66 gantries, 7:30 am Expanded to 66 gantries, 7:30 am to 4:30 pmto 4:30 pm
ERP system implementedERP system implemented– Vehicle transpondersVehicle transponders– Smart cardsSmart cards– Electronic gantriesElectronic gantries– OCR license plate recognitionOCR license plate recognition
Variable dynamic pricingVariable dynamic pricing– 8585thth percentile speed, 45 to 65 percentile speed, 45 to 65
km/hkm/h
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£5/vehicle; increased £5/vehicle; increased to £8/vehicle to £8/vehicle
Area expanded in Area expanded in 20072007
No barriers/tollboothsNo barriers/tollboothsResidents: 90% Residents: 90%
discountdiscount£1/vehicle discount £1/vehicle discount
for fleets with 10+ for fleets with 10+ vehiclesvehicles
Weekly, monthly, and Weekly, monthly, and annual passes.annual passes.
£120 fine; reduced to £120 fine; reduced to £60 if paid in 2 weeks £60 if paid in 2 weeks
Free passage routeFree passage route
Cordon Pricing: London
Western
Extension
Original
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Comprehensive PricingComprehensive Pricing
HistoryHistory Oregon experimentOregon experiment Puget Sound experimentPuget Sound experiment OthersOthers
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Most Proposals Rely On GPSMost Proposals Rely On GPS
Must Locate Where Vehicle Is Must Locate Where Vehicle Is Operated And MileageOperated And Mileage
Odometer Based Subject to Fraud Odometer Based Subject to Fraud and Costlyand Costly
Cell Towers is Another PossibilityCell Towers is Another Possibility
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TelematicsTelematics
Information
Button
GPS + Primary Cellular,
Combination Antenna
Protected
Backup Antenna
Telematics
Control Unit
EmergencyCall Button
RoadsideAssistance
Button
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Other ExperimentsOther Experiments
Puget SoundPuget Sound Minnesota pay as you driveMinnesota pay as you drive Iowa studiesIowa studies
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Different Pricing Considerations For Different Pricing Considerations For Light And Heavy VehiclesLight And Heavy Vehicles
The Primary Issue For Efficient The Primary Issue For Efficient Pricing For Light Vehicles Is Peak Pricing For Light Vehicles Is Peak CongestionCongestion
The Primary Issue For Efficient The Primary Issue For Efficient Pricing For Heavy Vehicles Is Road Pricing For Heavy Vehicles Is Road DamageDamage
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German SystemGerman System
Charge per kilometer on major roadsCharge per kilometer on major roads GPS system with cellular GPS system with cellular
communication for mostcommunication for most Allows for other users to pay per tripAllows for other users to pay per trip Operating cost has been about 25% Operating cost has been about 25%
of revenueof revenue
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Dutch ProposalDutch Proposal
All Vehicles Pay Per Kilometer Based All Vehicles Pay Per Kilometer Based On Weight, Congestion, and On Weight, Congestion, and Environmental EffectEnvironmental Effect
Convert Fixed Cost Of Driving To Convert Fixed Cost Of Driving To Reflect Actual Usage Of The System Reflect Actual Usage Of The System And Cost ImposedAnd Cost Imposed
Manage Congestion, Road Damage, Manage Congestion, Road Damage, And Environmental ConcernsAnd Environmental Concerns
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Cost Estimates From Four SourcesCost Estimates From Four Sources
Large Reputable Companies Large Reputable Companies Contracted To Estimate Cost For Contracted To Estimate Cost For Comprehensive Pricing SystemComprehensive Pricing System
Cost Categories-Initial and AnnualCost Categories-Initial and Annual– On Board UnitOn Board Unit– AdministrativeAdministrative– CollectionCollection– Enforcement Enforcement – MiscellaneousMiscellaneous
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Cost EstimatesCost Estimates
Cost ItemCost Item VMT FeesVMT Fees
Average Cost over providersAverage Cost over providers
Per Unit of Total Operating CostPer Unit of Total Operating Cost
$ per lane mile$ per lane mile $4,042 $4,042
$ per centerline mile$ per centerline mile $8,245 $8,245
$ per 1,000 VMT$ per 1,000 VMT $6.26 $6.26
$ per vehicle$ per vehicle $75.16 $75.16
$ per transaction$ per transaction $6.95 $6.95
% of total revenue% of total revenue 6.6%6.6%