Rep. Glenn Thompson, R-Pa., sent us the following response:

I agree with Transportation Secretary Ray LaHood that tolling of federal interstates should not be permitted on existing facilities. Moreover, I believe it has been best stated by House Transportation and Infrastructure Chairman James Oberstar, when during a 2007 visit to Pennsylvania he said, “They’re taking existing capacity, built with federal highway trust funds, and charging you twice for it by putting a toll on it.”

The Interstate Highway System was created to enhance the flow of goods and services throughout the country and has improved our economy and the lives of our citizens, while allowing America to remain competitive in a global market. Tolling existing capacity will do nothing more than cripple an already ailing economy.

However, the public-public partnership between the Pennsylvania Turnpike Commission (PTC) and the Pennsylvania Department of Transportation (PennDOT), created by Pennsylvania Act 44, has very little to do with innovation or creating a sustainable transportation funding model, but more to do with the continuation of antiquated and patronage laden government, where the taxpayer ultimately loses.

Pennsylvania Act 44 created a financial model permitting the Turnpike to issue bonds in anticipation of receiving funds from future I-80 toll revenue. Despite two unsuccessful attempts at federal authority to toll Interstate 80 under the Interstate Rehabilitation and Reconstruction Pilot Program (ISRRPP), Pennsylvania continues to borrow against future I-80 toll revenue. This is hardly a sustainable future.

The ISRRPP was created in 1998, yet, to date, no state has brought it to fruition. Section 1216(b) of TEA-21 provides for limitations on toll revenues received from operation of the toll facility to be intended for the maintenance and reconstruction of the interstate. The program stipulates that a candidate facility have no other means of sustaining current maintenance levels in order to toll. The FHWA has denied Pennsylvania’s application for tolling authority due to a laundry list of discrepancies, but primarily because the Commonwealth arbitrarily determined a value for the facility based on a dollar amount that would create a backchannel mechanism for funding projects off the I-80 corridor and paying for $412 million in federal highway funding the Governor diverted to mass transit between 2004 and 2007, which otherwise would have been used for roads and bridges.

A 2005 Pennsylvania Department of Transportation (PennDOT) study, “with assistance from the Pennsylvania Turnpike Commission”, concluded “converting I-80 to a toll road not be pursued at this time. The initial impetus for converting I-80 to a toll road no longer exists. The once deteriorating condition of I-80 has been corrected by PennDOT and the annual cost of maintaining I-80 is no longer an abnormal drain on PennDOT’s budget.”

Despite PennDOT’s recommendations, in less than 18 months tolling I-80 became a “need” as the PTC was under increased threat of being leased as part of a proposed public-private partnership, in which a private company would assume management duties of the Pennsylvania Turnpike in exchange for a one-time upfront payment. At the same time, personnel at the Turnpike were the focus of investigations in which federal indictments were handed down. One of the figures who played a key role in developing Act 44, has since been convicted and sentenced to prison. Additionally, the no work for taxpayer funds scandal has also forced the removal of the Chair of the Pennsylvania Turnpike Commission.

As Mr. DJ Gribbin, former DOT General Counsel, rightfully suggested in his post; “In fact the public-public transaction appears to be structured primarily as a way to transfer tolls from the Interstates to use for other purposes, with no real additional efficiency, innovation, or cost savings.” In Pennsylvania’s case, the proposal was a means of preventing accountability and review that potential private investment in the Pennsylvania Turnpike would have required.

The intent of Congress was to insure that if such dramatic policy shifts as tolling existing federal interstates were permitted, goals such as reducing congestion, environmental benefits, and improving road maintenance were achieved. The purpose of the ISRRPP is not to enable officials to create questionable financing schemes under dubious conditions, which would ultimately result in increased debt and higher costs for the residents of the Pennsylvania and those traveling within the Commonwealth.

The ISRRPP should serve as a means of emergency sustenance, not survival. Given that the program has not been successful, I have authored legislation, H.R. 1071 – the Keeping America’s Freeways Free Act. The intent of my bill is to not only prevent the tolling of Interstate 80 in Pennsylvania, but to also raise this issue at a national level. This debate is certainly welcomed and long-overdue. I applaud the House Transportation and Infrastructure Committee for their blueprint for surface transportation reauthorization, which proposes to terminate the ISRRPP and I look forward to working with the committee to make it a reality.

As for Pennsylvania, the Commonwealth’s legislature would best serve the public good by halting the borrowing that is occurring and return to the drawing board. Only then, will the Commonwealth be able to take a good look at our transportation needs and address the serious transportation funding problems facing it.

The benefits and drawbacks of tolling in general are well set out in numerous responses. However, one aspect that often gets overlooked, and can affect one’s view of the merits of tolling, is that cash tolls—with “tollbooths”—create significant problems apart from the revenue involved. As anyone who has ever sat through the long traffic backups approaching Delaware’s I-95 tollbooths on holidays and some weekends can attest, that kind of tolling itself causes major traffic delays. Also, vehicle accidents can generate safety hazards for the toll collectors. Hence, even apart from the payment itself, cash tolling of this type understandably generates some negative public reactions.

Current law as set forth in 23 USC 301 generally provides that, subject to a few exceptions, federal highways “shall be free from tolls of all kinds”. SAFETEA-LU, P.L.109-59 (2005), which presaged the need for additional revenues while maintaining the “user pays” principle, created addition exceptions for certain pilot projects that were authorized in section 1604.

One of those authorized pilot projects was for an “express lanes demonstration program”. And one of the keys to enabling that tolling provision was section 1604(b)(5), which says that “[f]ees collected from motorists using an express lane shall be collected only through the use of noncash electronic technology that optimizes the free flow of traffic on the tolled facility.”

That requirement for exclusively electronic tolls was not extended to all tolling facilities, but it should be. Otherwise, tolling often will fail to provide the market-based benefits of a price mechanism, and instead will be a form of government-created congestion and delay. Two weeks ago, DOT Secretary Lahood wrote on his blog about North Carolina's Triangle Expressway, to focus on its all-electronic toll collection system. See http://fastlane.dot.gov/2009/08/highway-administrator-mendez-attends-triex-event.html#more. Last year DOT Secretary Peters called for an end to cash tollbooths by the end of the next highway reauthorization bill in 2014, and that remains a worthwhile objective. See http://www.dot.gov/affairs/peters120808.htm

IPat Jones has asked me to clarify the last point in my previous post:

My point is that there is a kind of mythology surrounding the creation of our interstate system that is quite useful. The public was supportive of the infrastructure investment in a way that they rarely have been. If we treat the interstate as just another asset, we de-mythologize it. In my view we do so at our peril.

As I noted in my first post, I support tolling in exceptional circumstances (such as congestion) if authorities pledge to reinvest all proceeds in improving service and/or increasing capacity. Communicating to the public why we are doing it and under what conditions is likely to maximize the chances of receiving support.

Many of the bloggers have noted that they support tolling but only in ways that protect the public interest. I would be interested to know what proponents identify as the public interest, how they would protect it, and under what conditions states and localities should be permitted to toll (or should this be an unlimited authority?).

Simply saying that states and localities need the money and they should be allowed to get on with it ignores the fact that the vast majority of the public and many members of Congress, whose support we need to transform transportation and meet our infrastructure needs, would oppose such a far-reaching delegation of authority. For most of the public the interstates are not just another asset. I would argue that perspective has served us well and is something to build on and not ignore.

Like a majority of my fellow bloggers I think that the current federal prohibitions on tolling of the interstates should be abolished and decisions to toll should be left to the individual states and metropolitan areas.

However, I do not see any ground swell of support for tolling at the state and local level either. On the contrary, evidence from Pennsylvania, Texas and, most recently, northern Virginia points to deep seated and widespread opposition to tolling at the grassroots level. Those of us who hope that giving the states greater leeway to toll will open the floodgates to tolling of existing federal-aid highways may end up disappointed.

Normally I would have responded to this question about tolling the Interstates much earlier in the week. I’m glad I waited so I could read so many other excellent responses.

The vast majority of respondents agree that we should never take any funding or financing option off the table, especially because our country is in a deep recession and we have failed to adequately invest in transportation for decades.

I fully agree with what the vast middle ground of experts said in response to this question:

• “The archaic restrictions on tolling the interstates should be removed.” (Robert Puentes)
• “The federal government should be permissive in allowing states and metropolitan regions to use these techniques to manage their transportation systems.” (Emil Frankel)
• “It’s time for the federal government to give much more flexibility to state and local governments to innovate in how they finance and solve transportation problems.” (Michael Replogle)
• We “have to start getting more bang for our buck by building better infrastructure.” (Patrick Natale)
• “The current system [of funding highways] is untenable and unsustainable.” (Rep. Earl Blumenauer)
• We should permit “the tolling of federal highways as one more possible option for solving our infrastructure financing crisis.” (Robin Chase)
• “It’s time to get over the repetitious, unproductive conversations underway and realize we aren’t going to find a free fix.” (Paul Yarossi)
• “The federal government should… [allow] the states the freedom they need to develop creative and workable solutions to their budget and infrastructure needs.” (Geoffrey Yarema)

No one will be surprised that, like nearly everyone else who responded to this blog question (11 of the 14 respondents so far), I support the notion of allowing tolling of Interstate highways. And I agree that it should be done in ways that appropriately protect the public interest. What is perhaps surprising to some is how big and broad is the consensus in favor of allowing tolling of existing Interstate highways in some form. This is a mainstream view embraced by smart people on all points of the political spectrum. Bill Graves and Greg Cohen are outliers in this debate.

I think it’s interesting that both Graves and Cohen cite the case of the proposed lease of I-80 in Pennsylvania as the scary extreme. But guess what? It didn’t happen! Most experts agree that the time of big up-front payments for toll road lease/concessions has passed. If anything, the Pennsylvania example demonstrates that even a very strong and adept governor couldn’t win the argument for this particular effort. There is a much longer history of more modest and focused tolling projects. Given the serious collapse of highway funding we’ve seen in recent decades, the new funds resulting from the conversion of an Interstate highway segment to a tolled facility are more likely to be spent on that particular highway segment than anywhere else.

-- Pat Jones www.ibtta.org

While it won’t be the ‘silver bullet’, we absolutely should consider tolling, even on existing interstate highways, as one of the tools in the solutions toolbox. Over the next five years, funding needs will outpace spending on roads and bridges by nearly $550 billion. With a problem of that magnitude, we can’t afford to take any revenue options off the table when we talk about solutions. And, if we are to have any long-term success, users are going to have to learn to associate an appropriate cost with the benefits they reap.

What we need is a bundle of options targeted at specific goals, such as system preservation, congestion relief and environmental quality. Included in that bundle will have to be things like increasing the use of PPPs, raising the federal gas tax and utilizing infrastructure banks.

It’s not all about “more money” though, we also have to start getting more bang for our buck by building better infrastructure. This means considering life cycle costs in the design and planning stages, creating regional infrastructure plans, and promoting sustainability and resilience (all included in the Five Key Solutions from our last Report Card). Just meeting the needs we have today won’t really solve the problem. We have to imagine how future generations will use, maintain and modify our infrastructure systems, and then be creative in how we plan, design, build and maintain them today.

Ultimately, can tolling interstates help state DOTs make up some current budget deficits and keep ongoing maintenance on track? If the funds collected are reinvested solely in improving infrastructure conditions, then the answer is, “Of course.” But we cannot be lulled into thinking that one-step, one-time fixes will really solve the problem. If we’re serious about improving the nation’s surface transportation system, it will take multifaceted solutions and massive investments funded through a variety of sources.

It’s time for the federal government to give much more flexibility to state and local governments to innovate in how they finance and solve transportation problems, tying future federal transportation funding increasingly to demonstrated performance in meeting national goals for transportation. Those goals need to encompass support for improved mobility and economic development as well as minimizing adverse health, community, and environmental impacts, including greenhouse gas emissions.

Tolling legislation should be designed to protect and enhance the ability of local and state transportation and resource officials to protect public safety and health. Towards that end, the following principles should be part of the next transportation bill:

- The federal transportation bill should authorize continued and expanded dedicated funding for innovation, development, and evaluation of both toll and non-toll market incentives and road user charging designed to enhance overall transportation system and environmental performance, expand transportation choices, manage transportation system demand, and provide new revenues to complement other core sources of transportation funding. The long-standing Congestion Pricing Pilot Program might be integrated into a new multi-modal performance-focused, competitive Metropolitan Mobility Program or retained as a stand-alone program, but should not lose its identity as a source of dedicated funding that advances critical institutional capacity development, innovation, evaluation, and promotion of related global best practices. This is needed to help advance such strategies as VMT and emission-based road user charges, pay-as-you-drive car insurance, and the suite of other mobility services that should become available as part of an open-system road user charging and management platform.

- States should have broad flexibility to use value pricing and tolling as a supplemental funding source for transportation investments and to manage transportation demand while ensuring public involvement and oversight in establishing project goals and in performance monitoring and reporting regarding equity, the environment, transit services, and system performance.

- Within this framework, states should be given discretion to toll existing non-tolled lanes and newly constructed lanes, regardless of whether new corridor capacity is added. Current restrictions on tolling Interstate highways should be eliminated and the specific decision to use or not use tolls on existing or new facilities should not require federal approval. States should be allowed to convert high-occupancy vehicle lanes to high-occupancy toll lanes, provided that such conversion does not degrade the traffic performance of the HOV facility, and to allow qualified low-pollution, high-efficiency vehicles in HOV/HOT lanes only if such vehicles pay a fee, which may be discounted.

- States should give priority in the use of toll revenues to retiring initial project debt, ensuring a reasonable return on investment, and funding activities that help meet project performance goals, including transit services that ensure more equitable access to jobs and opportunities. Federal legislation should authorize a Metropolitan Equity Pool that provides user-side subsidies for low income travelers who lack good travel choices who might otherwise priced out of mobility, as advocated by the Brookings Institution.

The United States is currently in the midst of a severe infrastructure funding crisis. The highway trust fund – between modest vehicle fuel efficiency and inflation – has lost about 33 percent of its funding capacity since the gas tax was last increased in 1993.

At current funding levels, we are about $90 billion short of maintaining our existing program, let alone doingwhat most experts feel is necessary in the future. It is important that we not rule out funding options, including tolls, until we have a strategy in place and start replenishing the trust fund. This is especially acute since the inadequate fund is about to get a lot more inadequate with the introduction of more fuel efficient vehicles.

While these vehicles will help reduce oil dependence and global warming pollution, consuming less gas means less money going into the trust fund. Even if there were adjustments to the motor vehicle fuel taxes, we are still locked into a downward spiral as more efficient vehicles are introduced, including the prospect of electric vehicles that do not use gas or diesel at all.

In short, the current system is untenable and unsustainable.

Funding for the long-term must include a mechanism to correlate road use with vehicle charges. I have introduced legislation to explore a vehicle miles traveled fee, which had a successful pilot program in Oregon in recent years. Until we have the long-term funding mechanism in place that is technically efficient, accepted by the public, and generates revenue at the necessary levels, it is premature to rule out any revenue source. We need to be looking at the big picture to ensure that policy makers have options to prevent the system – and our roads and bridges – from literally falling apart.

So many people have weighed in. I agree with those advocating for permitting the tolling of federal highways as one more possible option for solving our infrastructure financing crisis.

A few new points:

· Existing fuel taxes do not cover on-going maintenance of this now built roads. We know this because the gas tax hasn’t been raised for 18 years and their has been significant inflation. And we also know this because there is an enormous backlog on all types of roads required to bring them up to a state of good repair. Bill Graves: Has the trucking industry evaluated what the cost of poorly maintained roads and closed bridges actually costs the industry? I had an interesting conversation a few years back with the head of government relations for UPS. He said that they had been strongly opposed to congestion charging (in London). But that once it got underway, they realized that it saved them enormous amounts of time and money because of the less congestion streets, and were now strong supporters. I could imagine the same for the trucking industry.

· The administrative costs of open-road toll collection may indeed be high, but it need not be. The cell phone industry has been able to measure roaming minutes (which are very similar to roaming miles) at very low cost, and Zipcar has tracked mileage (and applied charges on that basis) since its inception at very low cost. I believe the high administrative costs we experience in open-road tolling today is due entirely to the fact that this service is provided using closed proprietary devices with long-term contracts let to companies who are given monopoly control of payment. If we opened up the devices and enabled a wide range of electronic payment systems, these collection costs would be as insignificant as the fuel tax collection costs.

Tolling of existing Interstate highways is simply wrong. Turning highways into cash cows for individual states is unfair to the highway users who have paid for the construction and maintenance of these roads through the payment of fuel taxes. Federal fuel taxes have been the preferred funding method of the Interstate Highway System since its establishment in 1956. Subjecting users to additional tolls represents double taxation. Tolling on existing highways is nothing more than an ill-conceived quick fix for transportation funding shortfalls. Often toll revenue doesn’t even end up funding highway projects. In Pennsylvania a portion of proposed toll revenues were going to the Philadelphia transit system.

Imposing tolls on existing lanes of the Interstate System would have a devastating effect on the trucking industry, which delivers almost 70 percent of our nation’s freight tonnage and virtually all consumer goods. The trucking industry is highly competitive and tolls costs are extremely difficult to pass along to shippers. A shipper in California doesn’t understand why they’re being charged for a toll in Pennsylvania. Motor carriers currently pay a federal diesel fuel tax of 24.4 cents per gallon, a 12 percent excise tax on new tractors and trailers, an annual vehicle use tax of up to $550, and a tax on tires. In 2006 commercial vehicles paid a total of $17.8 billion in federal highway user taxes, or approximately 45 percent of all federal highway user fees. In addition, trucks paid $19.6 billion in state user fees. Imposing an even greater tax burden through tolls would be both unfair and inequitable.

In addition, toll collection requires a large and extremely expensive bureaucracy. On major toll roads, toll collection costs are as high as one-quarter to one-third of revenue versus and are essentially nothing but an inequitable and inefficient tax. In contrast, administrative costs represent only 1 percent to 2 percent of revenue generated from a fuel tax. Fuel taxes are the least expensive, most efficient source of highway funding available today. Other systems such as tolling cannot come close to offering taxpayers that efficiency. That’s why the trucking industry is willing to pay more in fuel taxes, as long as the added revenue is dedicated to highway infrastructure.

Mandatory tolls also create two classes of drivers, those who can afford to pay a toll and those who cannot. And they cause diversion of traffic to other, often less safe roads. In Ohio tolls were raised on the Turnpike, then significantly reduced upon finding that large numbers of trucks were using parallel non-tolled routes that were less safe than the Turnpike.

In May, Senator Kay Bailey Hutchison introduced legislation (S.1115) that would prohibit states, private entities and private-public partnerships from adding tolls on existing federal highways, bridges or tunnels built with federal funding. We support Sen. Hutchison’s efforts to eliminate double taxation on our Interstate system.

While tolling is an effective way to fund new routes that add additional capacity and travel options, it does not provide a long-term solution for funding our existing highway infrastructure. The simple answer for increasing trust fund revenue is to increase the federal fuel tax.

We’ve reached a total impasse to address our country’s infrastructure problems. It’s time to get over the repetitious, unproductive conversations underway and realize we aren’t going to find a free fix. The delays only increase costs, continue the deterioration of the transportation system, delay improvements that will make travel safer, and decrease employment in the construction industry.

It’s time to address the problem.

It’s easy to be against any funding option—increasing the gas tax, tolling, a vehicle miles tax, concessions and other viable ways to fund infrastructure maintenance and improvement. We have to ask if it’s important to have an efficient transportation system for the greater good. We know the right way to pay for it is through user fees—all options—gas tax, tolls, VMT, others. Find the right way, and let’s get going. If the right solution generates jobs and helps improve stability for our economy, we need to consider it.

Until we can make a decision and understand nothing is for free, we’ll remain in a stalemate and continue to worsen our infrastructure woes. Let’s stop talking—and start looking at all the options to find the right combination for a solution.

As state transportation budgets are increasingly pinched, and unless and until Congress steps up to the reality of creating new federal resources, state and local governments have no choice but to find alternative methods to pay for critical infrastructure. Tolling the interstate is an option that some states are considering. While distasteful to many, and politically difficult to be sure, the question is the extent to which Congress will limit the options the states will have available.

D.J. Gribbin is correct that there are no current examples of successful tolling on pre-existing interstate capacity. But past is not necessarily prologue. The world is changing: travelers on congested urban interstates are demanding better mobility at the same time that many cities and states are working to reduce traffic related greenhouse gas emissions. Tolling has the potential to address both issues. As a result economists and environmental stakeholders have urged the option be kept on the table, although not without recognition that the tools be applied carefully.

The National Surface Transportation Infrastructure Financing Commission analyzed these issues carefully and specifically recommended that federal policy allow tolling on the interstate in the following situations:

• New interstate capacity, in metro areas with populations greater than 1 million
• New interstate capacity, outside metro areas with populations greater than 1 million
• Existing interstate capacity in metro areas with populations greater than 1 million
• Existing interstate capacity, outside metro areas with populations greater than 1 million should be limited to an expanded Interstate System Reconstruction and Rehabilitation Pilot Program

As safeguards to protect the public interest, the Commission recommended:

• States should be required to use any toll revenues above and beyond operations, maintenance, and debt servicing for qualified projects within the state or other relevant jurisdiction
• Toll operators must publish price data in interoperable formats
• USDOT should complete tolling standardization rulemaking

The federal government should limit its role to protecting the free flow of interstate commerce, while allowing the states the freedom they need to develop creative and workable solutions to their budget and infrastructure needs.

Having once been summoned to the White House press briefing room to defend the concept when we included it in the Clinton Administration's NEXTEA bill, I'd be reluctant to say "never." But like Steve Van Beek, I think it is more likely to be the exception than the rule, and that's why DOT's approval opportunities have been limited within the Congressionally approved programs.

In particular, I think the case needs to be made very clearly that needs in the particular corridor are the driving force for tolling, whether for capacity expansion, system preservation or operational efficiency. No ways of paying for our transportation needs seem to be popular these days, but this one can create its own opposition. VMT fees and other forms of road pricing are something we need to work towards, but in a way that the benefits are just as apparent as the costs.

Tolling existing interstates should only be done in exceptional circumstances and any and all proceeds should be reinvested in the corridor to improve service. One example would be to reduce unacceptable levels of congestion and provide a better level of service to users (and if possible to add capacity). Under these restrictive conditions, I think you would maximize the chances of getting support.

This is as much a political argument as an economic one. The idea is unpopular and as an industry we are much better off keeping our powder dry for the tough decisions such as raising the fuels tax and/or shifting to a VMT-based fee.

No, existing Interstate highway lanes built with taxes should not be tolled, monetized, and reverse-mortgaged.

The Pennsylvania example shows clearly why such a plan is not in the public interest. Here is a case where the road users face a new and exorbitant tax and the State promises absolutely no benefits in return to the tolled users... i.e. no new lanes, no new bridges, nothing except growing tolls! Anyone who lives along this road, runs a roadside business, or has an established logistics system that relies on this road would be held hostage to automatically increasing tolls.

As DJ Gribbon points out in his post:

"The lease agreement ... represents little other than a government to government transfer of fees collected from the traveling public, converting the user fees paid by drivers of I-80 into taxes used to finance expenses not related to the use of I-80. In fact the public-public transaction appears to be structured primarily as a way to transfer tolls from the Interstates to use for other purposes, with no real additional efficiency, innovation, or cost savings."

I agree with DJ and add that this entire arrangement (I-80 tolling) was sold to the legislature on the theory that out-of-state traffic would largely pay for Pennsylvania's internal transportation investments and save politicians from having to vote for a traditional highway user fee increase. If Pennsylvania is successful, there is no doubt that other states will also want to look to non-residents to pay for their needs. Over time, these hostile tolling strategies will pit states against each other with road users and road side businesses taking the brunt of the pain. This is an outcome that is totally antithetical to the concept of a nationwide interstate system efficiently serving long-distance travelers and commerce. For this reason alone, DOT should not approve the I-80 plan.

Under traditional plan to construct toll roads, the users are only expected to pay off the costs of construction bonds, maintenance, and improvements on the toll road. The I-80 plan turns this customer/toll authority relationship on its head, with toll road users serving as a cash cow for expenses completely unrelated to their use of I-80 -- in many cases, we are talking about expenses that are hundreds of miles from the toll road itself.

A much better model is the state gas tax (or a VMT fee for all users), which is protected in Pennsylania as a true diversion-free highway user fee. All highway users pay statewide and the revenue is used solely for highway investments. It is a much fairer system because everyone pays and everyone benefits. Other state expenditures, including non-highway investments are funded by other taxes.

Pennsylvania's lawmakers and Governor need to bite the bullet, and add additional highway user fee revenue to support Pennsylvania's highway system in an honest, fair way. Tolling I-80 doesn't meet that test.

When the Bush Administration introduced the bill that became SAFETEA-LU, it contained a provision to remove the existing prohibition on tolling the Intersate Highway System. The legislation that was eventually enacted in 2005 contained, instead, an expansion of the various tolling and congestion pricing pilot programs.

What seemed appropriate in 2003 seems equally so today, that is, allowing the introduction of tolling and congestion pricing on the Interstate System to be "mainstreamed," rather than the subject of continuing pilot programs.

It should be emphasized that this is not a call for the federal government to prescribe the use of road pricing, as a means to raise investment capital for the transportation system and/or to influence demand for key -- and frequently congested -- highway facilities. However, the federal government should be permissive, in allowing states and metropolitan regions to use these techniques to manage their transportation systems. The important thing is a set of federal policies that allow and promote innovation and competition at the state and local levels. Removing the existing prohibition on tolling the Interstate System is an important element, in allowing such innovation.

Some have expressed the view that state and local officials will abuse this permissiveness, in a manner inconsistent with the public interest. As Gov. Rendell of Pennsylvania and others have noted in testimony before the House Transportation and Infrastructure Committee, there is no reason to believe that elected officials at the state and local levels will be any less sensitive to the public interest than Members of Congress.

To be sure, some basic protections should be maintained, if tolling of the Interstate System is to be allowed. As always, the Consitutional protections against undue burdens on interstate commerce would apply, and the funds raised from the imposition of these tolls should be re-invested in the surface transportation system, perhaps in the same corridors or regions in which the tolls might be imposed. However, the limitations and constraints on tolling, recommended in STAA, appear to run the risk of regulatory overreach and to create a "chilling effect" on state and local innovation.

An important element of reforming national transportation policy will be to allow and promote state and local competition and innovation, in meeting transportation challenges, consistent with clearly articulated national goals. While accountability should be a critical element of such a reforned programmatic framework, that accountability should be matched with an atmosphere that allows and promotes creativity and experimentation. Allowing the tolling of the Interstate Highway System can be an important element of such a policy and programmatic structure.

Whether a specific stretch of interstate should be tolled is tough to answer. The interstates serve a range of functions so whether or not tolling is the right approach kinda depends.

Another question would be whether the federal government should expand its experiments and pilot programs to provide more options for interstate tolling.

Yes it should—but as part of an overall national policy for road pricing that includes a range of flexible strategies: standard tolling on the interstates and otherwise, variable pricing, HOT lanes, cordon and area wide schemes. The goal would be to permit states and metropolitan areas to deploy the best mix of strategies for their particular area. It would do several things:

First the archaic restrictions on tolling the interstates should be removed. Metropolitan and local leaders—in conjunction with the states—are in the best position to determine which interstate roadway segments are the strongest candidates for pricing strategies. Such portions would include those where a range of travel options exist or are planned, and where the most intense peak-hour congestion on expressways is present.

While we often equate the interstates to long stretches of rural roads, more than half our interstate system mileage is in 'urban' areas. For that reason, a broad range of tolling strategies should be considered–not solely for revenue generation but for congestion and demand management strategies such as on beltways, downtown spurs and within mega regions.

Next, the federal government should follow the advice of the NSTPRSC and promote a national standard for electronic toll collection so toll payments do not become a burden in interstate commerce. It would also allow the migration to variable pricing and could move us to Bob Poole's worthy goal of eliminating all toll booths in the U.S. by 2015.

Third the federal government should help metropolitan areas address what my colleague Anthony Downs refers to as the "economically discriminating" nature of road pricing.

There are several ways to do this. One would be to require that at least a portion of the revenues generated from the tolls on the federal interstate go into a Metropolitan Equity Pool to fund programs that ease the burden on low income families such as paratransit type-services or through "toll credits" that low income households would receive to occasionally drive on priced lanes.

So all this is a heavy lift, no doubt. For one, although twice as many interstate miles are in urban areas, combination trucks log more vehicle miles on rural interstates than urban ones and that industry will remain strongly opposed. But the first step is for the federal government to show leadership in establishing an overall policy and then empowering states and metropolitan areas to make their own decisions in order to maximize our scarce transportation resources.

I am not sure that an aviation executive qualifies as an expert on tolling Interstates, but as a concerned citizen, I am very much opposed to any such transaction unless the agreement contemplates clearly stated economic or operating advantages that cannot be achieved in any other way.

Agreements proposed to date contemplate nothing but converting anticipated future net cash flows into a lump sum which will be applied to other uses. As such, they are a dishonest tax, marketed as improving efficiency and encouraging "private sector" initiatives but in reality doing nothing but converting the future value of taxes already paid into a lump sum which will be used to pay for unwise, inappropriate or unfunded expendititures for which the governmental unit in question is unwilling to tax its citizens.

In July of 2007, the Pennsylvania legislature passed Act 44, which allowed for the tolling of I-80 and the lease of the Interstate to the Pennsylvania Turnpike. This launched an 18-month discussion with FHWA on the merits of tolling I-80 under the Interstate Reconstruction and Rehabilitation Pilot Program (IRRPP), a program allowing an exception to the general prohibition on tolling Interstates. The effort to toll I-80 was ended when FHWA determined that Pennsylvania's toll application did not meet the requirements of federal law. Now Pennsylvania is considering making another run at getting federal approval.

The future of I-80 raises a fascinating mix of transportation policy issues.

• Tolling of the Interstate and then transferring it to the Pennsylvania Turnpike in exchange for lease payments would represent the first major public-public partnership of a toll road.

• While tolling is an efficient means of paying for transportation infrastructure, no existing Interstate has been successfully tolled.

• And finally, there is the question of how the proceeds from the lease will be spent.

The shortcomings of the initial application to toll I-80 under the IRRPP are clearly surmountable. The primary failing of the application was its failure to adequately describe how the leasehold was valued.

Federal law requires a state to charge at least fair market value for the lease of property obtained with federal funding. Yet, the lease value for I-80 was set by statute based on a funding gap and political compromises. The good news for PA is that this problem can be remedied by appraising the property or by having some competition for the lease that would determine its market value.

Assuming Pennsylvania is able to obtain federal permission to toll I-80, there is still the question of whether such a toll under the structure of a public-public partnership is in the public interest.

Public-private partnerships generate value a number of ways, including through efficiencies in operations and finance. That value can then be accelerated and monetized into a concession payment or a series of lease payments. Public-public partnerships, by contrast, just capture the benefit of increased tolls. (I reach this conclusion by assuming the Pennsylvania Department of Transportation (PennDOT) is just as capable of efficiently managing I-80 as the PA Turnpike will be.) Thus the series of lease payments envisioned under Act 44 and the lease agreement between PennDOT and the PA Turnpike represent little other than a government to government transfer of fees collected from the traveling public, converting the user fees paid by drivers of I-80 into taxes used to finance expenses not related to the use of I-80. In fact the public-public transaction appears to be structured primarily as a way to transfer tolls from the Interstates to use for other purposes, with no real additional efficiency, innovation, or cost savings.

Putting aside the challenges of a public-public partnership, attempts to toll existing Interstates have been universally unsuccessful. The public is reticent to pay for something that has been provided for "free." And a number of Members of the Pennsylvania Congressional delegation have already expressed fierce opposition to the tolling of I-80.

For those interested in tolling and concerned about the expenditure of transportation funds, the I-80 transaction will be one to watch.