Toll Insight spoke with Craig Shuey, Chief Operating Officer (COO) at the Pennsylvania Turnpike Commission.
The Pennsylvania Turnpike’s 565-mile roadway system comprises of the primary 359 mile east–west toll highway that runs across the state from the New Jersey to the Ohio borders, a 110-mile Northeastern Extension and 83-miles of Western Expansions.
1. What led up to PTC’s recent conversion to All Electronic Tolling (AET)?
The decision to convert to AET was a measured one that began ten years ago. We studied the impact on our operations and organization, then unveiled a series of AET pilots across the state beginning in 2016 to get real world data about the impacts. Finally in 2020, this preparation enabled us to convert ahead of schedule to safeguard our operations and ensure customer and employee safety during COVID. The system and our collections rates have performed within expectations we established during a decade of research and what we know to be standard across peer agencies.
2. Describe the key project steps which took place to implement AET?
Step 1: AET Feasibility Study: In 2011, our first step in the decision to convert our system to AET was to commission a feasibility study to educate ourselves on both the industry trends toward AET including the significant increase in E-ZPass penetration on our system and our own long-term challenges in the maintenance of current aging infrastructure. We used this documentation to formulate an approach to full system conversion.
Step 2: Pilot Conversions: We began our conversion in 2016, initiating the first of 6 regional pilots that would open over the following 4 years. We took this approach to understand the impact of AET on varying customer groups and geographies with differing levels of E-ZPass adoption. To monitor, track as well as be able to react and understand the impact of AET, we developed our Revenue Assurance Plan (RAP) in conjunction with the first pilot opening. This document has evolved over time as we have continued to open AET locations across our system and was a critical tool in our ability to develop a full conversion plan that would accommodate all customer groups, our employees and safeguard our revenue in this new collection environment.
Step 3: Full AET in Place Conversion: In 2020, all this preparation allowed us to convert to “AET In Place” (using existing toll plazas) ahead of schedule to safeguard our operations and ensure customer and employee safety during COVID. While this conversion was originally temporary in reaction to the pandemic, the ongoing uncertainty and changing mandates associated with COVID-19 necessitated that we make this a permanent decision. At that time, our technology was in the lanes and ready for use and given the unprecedented times, our customers were vigilant and adjusted well to the new collection methods.
Step 4: Phased ORT Conversion: The final phase of our AET Conversion is underway with construction of road-side gantries to allow for the implementation of Open Road Tolling (ORT) beginning in early 2025. In 2025, we will have moved our tolling locations, currently at interchanges located just off the active roadway, to high-speed gantries located at intervals along the mainline roadway. This conversion will begin in the eastern part of our state and be completed in our western locations in early 2027. Our conversion to ORT will also allow us to move away from trip-based toll assessment and instead use segment-based tolling, reducing complexity on our end and allowing for increased access to our system for neighboring communities. Once we have converted to ORT, we will remove the existing toll plazas, improving line-of-site onto our system for customers and reducing our maintenance costs and environmental impact.
3. What were the more immediate deployment challenges and lessons learned?
Nothing was more significant than the impact of COVID-19 on our timeline to switch to AET eighteen months early due to the public health need to separate people both within our toll buildings and eliminate close interactions with the traveling public.
One of the most critical challenges to the accelerated conversion was ensuring the thoughtful separation of a large portion of our employees who worked in our lanes and associated positions. Due to our measured 9-year conversion effort, we had been communicating and providing resources to impacted employees for many years; thus, the impact of this change was one we focused on conducting respectfully with both our impacted employees as well as those not directly impacted.
We learned the importance of preparation for change and that the best way to prepare for tough times is to make thoughtful, sound decisions and always be open, transparent, and present in the conversations regarding those choices. We followed these principles in our internal communications but also in our external communications.
Leakage has emerged as the most challenging issue to handle in public discourse. By developing our RAP early and being open with our legislature and our news media, we have chosen to tackle this issue with education and transparency. In these discussions, the lack of industry data on leakage has been a gap in our ability to communicate on this subject, and we look forward to the continued efforts of the IBTTA Lost Revenue Task Force to better understand and share this data on an industry level.
4. What have been the on-going operational impacts? And how do you foresee overcoming these?
The challenges associated with retrieving revenue when the best link you have to a customer is a license plate is one that will require constant attention. We have structured our toll rates to consider the expected leakage we knew to be present through our pilot projects and therefore, as an agency, collect at the levels needed to meet our financial commitments.
However, at its core, leakage is an issue of fairness between our customers, ensuring everyone pays their fair share. We need to attend to that concern by continuing to refine how we gain access to those customers who we can’t find or who get invoices but choose not to pay. We are doing this by aggressively using the tool which the legislature provided us: registration suspension. If we can show our overall customer base that there is a significant penalty for failure to pay, we believe we will begin to reverse the numbers on lost revenue and maintain the all-important confidence of our paying customers.
Other levels of refinement within our business will give us more opportunities to successfully track down customers with more tools than just a license plate look up and will further diminish unrealized revenue. You can never discount the opportunity that technology options may provide to us, and we are continuing to comb through all feasible ideas to find the right mix of both positive and punitive methods to ensure each transaction results in revenue to the Commission.
5. What do you think is required for the tolling industry to continue to thrive during the AET era?
We must continue to find ways to better collaborate over our various jurisdictions. One thing that is clear in discussions with many of our agency personnel is that we all do things uniquely and sometimes that is only because we “grew up” alone in how we implemented our tolling systems. Over time, if we can begin to standardize processes across agencies and limit the sense of confusion sent to our customers, we will be better positioned to make tolling more seamless and easier to adopt as a method for paying for needed roadway costs. We will soon likely have competition from mileage-based funding sources, and we will need to be in a good position to support that effort through the systems we have in place if the industry intends to stay relevant.
Embracing innovation and being flexible in how we conduct business to meet our customer’s needs and expectations is a driver behind the industry’s move to All Electronic Tolling; we need to keep that mindset in the forefront as we head into an evolving and changing mobility future. Customers are of course at the core of what we do and letting them drive us forward, meeting them where they want to be met and providing them with the resources they expect, as we did do with AET, is critical to our future.