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Think Congestion is Costly?

This is a guest post, originally posted by Julia at the Course Weblog of PA5113:
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Minneapolis-St.Paul is now the 10th worst city in the nation when it comes traffic congestion, according to results of a national traffic study by the Washington-based firm Inrix. The Twin Cities ranked 13th on Inrix's 2007 survey, but moved up three spots to No. 10 in 2009. The bumper-to-bumper traffic brought a huge price on valuable time, productivity, energy consumption, air quality, and even safety on the road. Texas Transportation Institute calculated that the nearly 1.4 million Twin Cities rush-hour commuters in 2005 wasted 41.8 million gallons of fuel stuck in traffic. Also lost over the year were an average of 43 hours per driver valued at $14.60 per hour for individuals and $77.10 for businesses. That same year, the American Automobile Association (AAA) study said the Twin Cities area cost per resident of crashes was $757, and more than one study concluded crashes account for up to half the congestion we encountered.

As a market-based solution, congesting pricing became an experimental measure to reduce traffic volume. Some researchers estimated that a 1 percent increase in the time-plus-money cost of automobile travel would lead to roughly a 1 percent reduction in the rate at which those trips are taken. In 2005, Minnesota opened its first priced lane, the I-394 MnPASS HOT Lanes. In September 2009, a similar congestion pricing scheme which called Priced Dynamic Shoulder Lanes (PDSL).

According to the evaluation of I-394 HOT lanes in operation in 2007, it did successful work as a traffic management. Average speeds in the unrestricted/free lanes have gone from 58.9mph to 62.2mph - an increase of 3.3mph or nearly 6%. But the revenue is under half forecast, just a bit over $1m. How to financially self-support challenge this market-based measure. The emergence of Public-Private partnerships (PPPs) offers an innovative method for financing infrastructure in pricing roadways.

For decades, policymakers have largely relied on taxes from gasoline to fund investment in roadways. But the growing scarcity of fossil fuels and the political infeasibility of raising taxes make the revenues from transportation-related taxes are failing to keep apace with the needs of the transportation system, the congestion pricing really provides a trial not only in improving life quality, but also in funding transportation infrastructure.


Inrix is a private corporation selling traffic management information, which makes it a bit suspect. A much less biased source of information is the Texas Transportation Institute. They take loop detector data to interpolate congestion.

From this, you get a very different perspective on congestion. The Twin Cities are actually on the low end relatively speaking. Congestion has been increasing here compared to other places because we have had capacity to become more congested, something many other places do not have because they are already so congested.

As to the MinnPass lane, it barely covers it operating costs and comes nowhere near its capital costs. The other thing it has taught us is that Minnesotans are very cheap and would rather sit in (not too bad) congestion rather than paying to not be in it.

Public Private Partnerships have not proven to be effective in every case. Private companies would like you to believe it but it hasn't been the case. Basically you are giving a geographic monopoly to a private company, with all the potential for abuse that comes along with that situation. Case in point, the 91 Express Lanes in Los Angeles. You can read about them here:

And the real question is "what can private industry do that government can't?" Unless there is a clear answer, there probably isn't a good answer. It isn't true that private industry is magically better than government. So what would help would be a clear discussion of what about private industry means that they could provide infrastructure better than government.

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