Toll Insight spoke with PJ Wilkins, Executive Director at the E-ZPass Group & IAG Service Corporation.
1. Please tell us about the E-ZPass Group and all that you have experienced in 2020.
Last year was undoubtedly a challenging one for the tolling industry. Toll agencies across the country, including the E-ZPass Interagency Group (IAG) member agencies, were impacted by the pandemic, which reduced traffic at their toll facilities and resulted in a significant revenue loss. That, in turn, necessitated tough decisions regarding which projects should proceed and which needed to be delayed due to the limited available resources. Our industry learned a lot about managing through the crisis. In the end, I think history will show that the agencies not only survived but became more resilient and efficient in their operations.
Despite the pandemic, 2020 was a big year for the E-ZPass Group. We implemented and executed several significant initiatives that were a long time in the planning. For example, we released a Request for Proposal (RFP) for an IAG Reciprocity Hub and started working on another procurement for what we call Next Generation Technology. We also approved a significant upgrade to our file specification which allows for more efficient operations and opens the door to more cost-friendly technologies. In September, we kicked off an Industry Days event focused on third-party participation in the IAG.
Perhaps the biggest news coming from the IAG in 2020 was the expansion of our membership and growth of our interoperable system, as five additional toll agencies joined our network. Our customers have long desired to have interoperability between the E-ZPass system and Florida's SunPass system. While we already had interoperability with the Central Florida Expressway Authority in Orlando, the remaining Florida toll facilities remained outside our network. In April of 2020, Florida's Department of Transportation joined as an E-ZPass member. They are currently working hard to become interoperable with E-ZPass; the completion of that process is expected early this year. Also joining in 2020 were Georgia’s State Road and Tollway Authority , Minnesota's Department of Transportation, the Kane County Division of Transportation in Illinois, and the Cape May County Bridge Commission in New Jersey. Once those agencies complete their interoperability projects later this year, the E-ZPass network will grow to 19 states.
2. Further to expansion and interoperability, what is the status of connecting the E-ZPass network to other regions via the planned hub-based approach?
National Interoperability has proven to be a tough challenge. When previous efforts culminated without achieving overall interoperability, the toll agencies started communicating directly, region to region. However, on-going challenges relate to understanding each region's business needs and the use of different tolling protocols that make interoperability difficult and potentially expensive. A fair and equitable approach to the process was needed to result in a consensus, such as to utilize the three major protocols to process transactions. One approach determined to be feasible was for toll agencies in each of the regions to implement multi-protocol readers, so that no agency would need to switch out its installed base of transponders until it was feasible to do so. Another approach was to have each agency decide for itself which protocols would be read by their readers. Some agencies can only read two protocols but would likely be able to process the third protocol transactions by capturing an image of the vehicles' license plates and charging the appropriate toll to the customer account. I believe this is the direction the industry has settled on.
The IAG members have committed to installing multi-protocol readers as soon as reasonably possible. Many of our members are already underway with that effort.
The IAG Reciprocity Hub procurement is now well underway, having received several qualified proposals in response to our RFP. We are currently in the evaluation phase and expect to decide later this year. One of the Hub's capabilities will be to connect with the other regional hubs; however, that is not the only function. It lends itself to several other efficiencies to improve our operations in the future. As you may expect, the Hub project is a huge undertaking and will likely come at a considerable cost. We will need to make sure we get this right, so we are putting a lot of time and effort into ensuring we use our limited resources appropriately.
3. What new technology is being tested, evaluated, and implemented within the E-ZPass Group to modernize tolling practices?
Our member agencies have been at the forefront of technology advances throughout their history, and we continue to explore new technologies and processes as we evolve. The IAG is a complex environment, consisting of just about any tolling application imaginable, from traditional gated lanes, to dedicated Electronic Toll Collection lanes, Open Road Tolling lanes, All Electronic Tolling lanes, High Occupancy Toll lanes, and managed lanes. Some members are studying cordon / business district tolling applications. The IAG's various committees are continually looking at new equipment and applications that will further the agencies' objectives and that of the E-ZPass Group as a whole. In any given year, we develop test plans, conduct testing, and certify new devices, transponders, readers, and so on. We have worked with several outside entities to certify an Integrated Toll Module installed in certain Audi vehicles to work as a toll transponder. Our members are also taking a close look at various third-party tolling applications that provide another method of paying the toll for customers that do not have an E-ZPass account.
4. You are also exploring non-tolling applications. Please tell us about that.
The IAG has long had an interest in exploring other complementary uses of the E-ZPass tolling system. Our first real foray into that environment was twenty years ago, in 2001 – a one-year pilot program in New York with McDonalds restaurants. Several Wendy's restaurants in Staten Island also utilized the E-ZPass technology for several years.
To date, our most successful application of the technology in a non-tolling environment is for parking spaces, with several facilities operating with the E-ZPass Plus system at airport and other parking facilities in New York and New Jersey.
Our newest pilot is the installation of Verdeva's PaybyCar program at four convenience stores in Massachusetts and three (soon to be five) locations in North Carolina. Customers can enroll and use their E-ZPass transponder linked to a credit card and purchase gas in a touchless operation. As you might imagine, contractless payments have received a great deal of interest during the pandemic, and we expect the number of locations utilizing this technology to grow rapidly.
5. In general, what is your view on the state of the tolling industry – "blind spots", opportunities and where we need to focus in the next 3-5 years
Now is an exciting time to be in our industry, as numerous initiatives are underway that will fundamentally change the way we do business. First, I see us making great strides in expanding interoperability between tolling agencies and/or regions in the near term. That is good news for our customers and good news for our agencies that can then process those transactions electronically. When will we achieve true "national" interoperability? Only time will tell, but each step closer to that goal is another step in the right direction. The E-ZPass system is now 19 member states and growing. As we continue to expand our membership and continue to work with other regions on interoperability efforts, more and more of our customers' traveling needs are met.
It is also essential that we devote some time and energy to the Connected Vehicle (CV) space. The promise of CVs that communicate not only between themselves but also with roadside infrastructure is upon us. Great strides have been made in various safety applications that will help drive down the rate of accidents on our roads. Focus is expanding to other, second-tier applications such as mobile payment applications. Our industry is currently working within several standards-setting groups to define how those transactions will flow, and ultimately, how the toll agencies would get the money for that transaction. This process opens a host of issues that we never had to deal with before. Who "owns" the customer? Is it still the toll agency? I don’t think so. Is it the automaker, a credit card company, someone else? How are discount plans administered? These and a host of others are interesting questions that are worthy of serious discussion. Having the radio equipment embedded in the vehicle, and therefore the toll agency not having to supply those traditional transponders may result in cost savings to the agencies. Will there be other costs associated with those types of transactions? Toll agencies need to be at the table now, as these systems and standards are being set, ensuring our fundamental needs are addressed in a seamless fashion moving into the future. In the immortal words of Bob Dylan, The Times, They Are a-Changin'. We need to be actively involved to understand what may impact our business model and how, in order to achieve the high standard of accuracy and customer service that we, and our customers, have come to expect.