Toll Insight spoke with Jeff Dailey, Deputy Executive Director of CTRMA.
1. The Central Texas Regional Mobility Authority (CTRMA) is among the newest and fastest growing government toll agencies in the country. What are some of the structural or operational characteristics of the organization that have fueled your success?
The agency leadership decided from the outset in 2003 to adopt a lean, entrepreneurial, contractor-driven business model, with a small full-time staff dedicated to innovation and timely delivery of projects. With key support from community leaders and our partners at TxDOT, we were able to open six roads in just over fifteen years.
In the financial arena, TxDOT grants and loans, TIFIA loans and several other creative financing structures were a major catalyst for our rapid evolution. We were also blessed by significant population growth, leading to traffic and revenue results that consistently exceeded projections.
On the construction side, we benefitted from a new state law allowing design-build projects, facilitating expedited projected delivery.
We also made a strategic decision not to build our own back-office payment system, instead relying on existing providers like TxTag, TollTag and EZ-Tag. And, we decided to contract out our license plate billing to a third-party contractor.
Another cutting-edge decision that fueled our success was a 2008 conversion to all-electronic cashless tolling. That decision dramatically reduced capital costs and enabled us to adopt annual inflation-based toll rate increases that provide a steadily increasing revenue stream with minimal controversy.
2. COVID has dramatically impacted many industries, including tolling. How has your agency fared? Do you have any lessons learned? How about observations/predictions regarding the future of tolling post COVID?
Like everyone, we saw a tremendous drop in traffic at the outset of the pandemic. Initially transactions were down more than 60%. On a positive note, traffic began to recover almost immediately and by Fall of 2020, we were only about 20% below pre-pandemic levels.
As of Spring 2021, a new normal has set in. Traffic is back to pre-pandemic levels, but it appears there has been a shift in travel patterns, with fewer people traveling during morning rush hour and more trips throughout the day. This shift has significantly impacted the revenue profile for our dynamically priced MoPac Express Lanes.
We believe the MoPac Express Lanes will eventually return to normal thanks to ongoing population growth, but it’s unclear exactly when. As a result, we’ve adjusted our planned toll rate schedule for our next Express Lane project. The 183 North Express Lanes will have a higher base rate per mile than the MoPac Express Lanes and the base rate will increase during peak hours, even if traffic density doesn’t warrant raising the rate. These safeguards will help ensure the financial feasibility of the project.
I should also mention that we got through the financial effects of COVID quite well thanks to a Board policy that set aside a whole year of operating expenses in reserve. We slashed our budgets and closely watched our spending to ensure we limited how much we cut into that reserve fund. In addition, our contractor-driven agency model proved quite helpful, as we were able to slash programs and spending on contracts without the need to lay off any of our own staff.
3. More generally, you opened your first Express Lanes with dynamic pricing a few years ago. Can you tell us what is unique about your Express Lanes and what insights you have gathered from operating them?
Our MoPac Express Lanes opened in phases starting in Fall 2016. We spent many years prior studying other express lanes projects and learning everything we could from their operators. While we learned two lanes each direction is better than one and shoulders are preferable, we didn’t have that luxury due to space constraints. As a result, we do see some operational issues that disrupt traffic flow.
Among our biggest observations is that brake lights and cars slowing down in the adjacent lanes can lead to traffic backing up in the Express Lanes. We also learned that plastic pylons don’t stop drivers from illegally entering and exiting the Express Lane. More important, enforcing illegal lane changes has proven difficult, as is enforcing our ban on multi-axle vehicles.
We learned during our research that enforcing vehicle occupancy requirements is a major issue. Fortunately, since these were new lanes and a not a High-Occupancy Vehicle (HOV) Lane conversion, we were able to avoid any requirements to offer free or discounted travel to HOV vehicles. Instead, we focused on promoting the lanes as a high-capacity transit route, and that has proven hugely successful, with some bus routes in the corridor (Pre-COVID) seeing ridership increases in excess of 200%.
One other lesson that we learned from our experience has been the importance of coordinating Park and Ride facility development with Express Lane implementation.
4. We understand that you have been testing new concepts for third-party toll collection, which has the potential to disrupt the traditional way of collecting tolls. What have you learned, and what do you think the implications are for the toll industry?
We did a pilot with Ford and Kapsch to test the ability of a Ford OEM head unit or infotainment system to trigger toll transactions by communicating with a Roadside Unit (RSU) using Cellular Vehicle to Everything (CV2X) technology. The vehicle was able to show the driver that a tolling point was approaching and how much the toll was. Then, as the vehicle passed the tolling point, the vehicle confirmed the toll had been paid. The test involved a Road Usage Charge (RUC) scenario as well. The testing proved the concept was feasible. However, the current approach still relies on a license plate image to confirm the transaction on the back-end, like other third-party platforms already in use.
The transition to electric vehicles is going to put even more pressure on elected officials to find new ways beyond the gas tax to fund roadways. New technology and the push toward RUC could see the elimination of traditional toll tags and toll gantries. We are also likely to see a proliferation of third-party payment providers seeking a piece of the vehicle-based transaction processing market. Such changes could dramatically alter the role of toll road agencies.
With all of that in mind, we’ve decided to step away from the traditional model of having a toll system integrator manage our roadway data. Instead, we are in the process of a developing an open-source data platform that will host a wide range of data including our toll transaction data and roadway sensor data. This cutting-edge approach will give us more flexibility to evolve as we change technology providers, update hardware and incorporate new technologies. The data platform is also part of our plan to improve the sharing of information amongst regional mobility partners and private sector entrepreneurs.
5. Automated and connected vehicles have been a hot topic in recent years, as have electric vehicles. The precise path for rollout of these technologies remains unclear. How are you preparing to take advantage of these new technologies and to make sure your agency will be ready to adapt as these technologies evolve?
We have been reaching out at every opportunity to industry leaders, research institutions and other agencies to learn as much as we can and remain engaged. As you noted, the path is unclear on a lot of these technologies, and we don’t want to be at the “bleeding edge”, so we are piloting and testing various concepts in a limited capacity.
Along those lines, we recently contracted with a company called WayCare to enhance our traffic management center. They use connected vehicle data and combine it with traditional roadway sensor data to detect and/or predict crashes using machine learning and artificial intelligence. Automatic detection of incidents can speed up response times and reduce staffing requirements. We are also working with WayCare and others to develop the ability to send real-time traffic alerts directly to connected vehicles. And, we are anxious to begin using the technology as part of a smart work zone effort, where we can warn drivers of things like lane closures before they reach the work zone.
While it’s not completely clear if automated vehicles might benefit from dedicated lanes or dedicated corridors, we have been monitoring developments in that regard as well and looking at potential corridor opportunities in the Austin area.
Ultimately, we believe these new technologies will lead to safer roads with more informed drivers who face fewer disruptions to traffic flow. It is also our belief that these technologies will lead to cost savings as things like variable message boards and roadside signs can be replaced by in-vehicle displays and automated driving systems. And, most important, as our customer research has shown, customers are anxious to take advantage of these new technologies.