FUNDING: Reason Fdn. calls for value-added tolling

The Reason Foundation has released a new policy brief, “Value-Added Tolling: A Better Deal for America’s Highway Users,” that outlines principles for crafting a set of safeguards that would make “next-generation tolling a true (and pure) highway user fee, not a cash-cow to solve a state’s overall transportation needs,” according to Robert Poole, director of transportation policy for the Reason Foundation, who authored the study.

Poole cites four legitimate concerns of highway users:

• No value added, with tolling simply becoming an additional cost of a highway. That was evident in a number of previous state proposals to toll interstates;
• Diverting revenues to other uses. A number of high-profile toll agencies (mostly in the Northeast) fund other highways, mass transit, canals, public buildings and economic development out of toll revenues;
• Double taxation. On all current toll roads, users continue to pay existing fuel taxes in addition to the tolls; and
• Diverting traffic to parallel routes. This is always true to some extent, but is much worse when toll rates are high in order to pay for more things than the toll road.

The value-added tolling concept explored in the Reason Foundation study calls for a new model that would apply to newly tolled highways, such as rebuilt interstates. Its aim is to make such tolling a true highway user fee—not a hybrid of toll and tax—and to respond positively to long-standing concerns of highway user groups. The five policies are as follows:

• Limit the use of toll revenues to the tolled facilities;
• Charge only enough to cover the capital and operating costs of the tolled facilities;
• Begin tolling only when construction or reconstruction is finished;
• Use tolls to replace—not supplement—existing fuel taxes; and
• Provide a higher level of service for tolled interstates.

The full study is available at http://reason.org/news/show/value-added-tolling.