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Congestion Pricing 101

You may have read about congestion pricing in the newspaper or heard the phrase at a meeting and wondered what it means. There are actually many different types of congestion pricing. But the basic concept is to add significantly improved transit and other travel options and then implement a fee to drivers to use an area of the street or highway system, while driving or while parked, in order to induce enough of them to choose other ways or times of traveling so that everyone can access their destinations more easily.

The Chicago region has typically sought to build our way out of traffic jams and crowded streets. The state continues to build new roads and expand existing streets and highways, while the region tries to compensate by adding more transit service. It seems like we’re always behind, struggling to catch up with even more demand for moving people further and further out in the region. There’s never enough money to keep up with the demand, and sprawl continues apace. The explanation for this frustrating vicious circle is explained in a paper by Robert Johnson, who is a professor in the Department of Environmental Science and Policy at the University of California, Davis:

“The most-effective policy sets combine land use policies, such as compact growth, with strong transit provision and not expanding highway capacity. The addition of auto pricing policies, such as fuel taxes, work trip parking charges, or all-day tolls increases the effectiveness of the land use and transit policies. Peak-period tolls, by themselves, increase travel. Expanding road capacity, along with transit capacity, but without changing market incentives to encourage more efficient use of existing roads and parking, results in expensive transit systems with low ridership.” – “Review of U.S. and European Regional Modeling Studies of Policies Intended to Reduce Motorized Travel, Fuel Use, and Emissions” Robert A. Johnston, August 2006

Prof. Johnson’s reference to “market incentives to encourage more and efficient use of existing roads and parking” is commonly known as congestion pricing. The concept has been around for many years but has become especially popular as of late as major cities like London and Stockholm have implemented a form of the tool, and New York City and other U.S. cities and regions pursue plans to implement various types of congestion pricing. If you are new to the concept and are interested in quickly acquainting yourself with the basics, including case studies of on-the-ground uses of the tool, click through the suggested reading list below.

Suggested Reading

“Road Pricing” Victoria Transport Policy Institute

World Review of Road Pricing

Federal Highway Administration’s Urban Partnership Agreement program

IMPACTS conference on transportation

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