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Conference panel explores adding value to toll roads

At a summit hosted this week by the International Bridge, Tunnel and Turnpike Association, toll operators from around the country explained how they're aiming to add value to the use of their toll roads.

The operators expressed a common goal of getting as many users as possible by breaking barriers to perceived value -- a goal the San Diego Association of Governments separately said is not forgotten by SANDAG, which since 2011 has operated the South Bay Expressway toll road.

"When we talked about the toll reduction, it was much more than the reduction of the trip cost that folks pay," said SANDAG Director of Operations Samuel Johnson, speaking about the association’s efforts to reverse the past low usage of the South Bay Expressway.

The previous owner of the Expressway, which is a portion of state Route 125 that runs through Chula Vista, had set its minimum monthly toll charge per account at $7.50. Upon taking ownership of operations, SANDAG slashed that charge to $4.50.

SANDAG believes that decision played into its success in expanding the road's use.

In July 2013, SANDAG announced that it had met its usage goals, including an increase in local trips within Chula Vista and a 22 percent increase in overall usage of the road over what had been forecast had tolls not been reduced.

SANDAG also reported increasing FasTrak electronic toll accounts by 16 percent -- the goal was 10 percent -- and increasing FasTrak transponders in circulation by 20 percent on the road, when the goal was 15 percent.

A few toll operators in town for the summit, held July 20 to 22 at the Hilton San Diego Bayfront, provided during a panel discussion a number of value-adding ideas that Johnson said SANDAG has considered.

They also presented challenges faced, and pointed to communication with customers as the only way to find solutions.

Nic Barr, the vice president of operations for Transurban — which with the Virginia Department of Transportation operates the high-occupancy toll 495 Express Lanes in Virginia — said for instance that the opening of its managed lanes about 18 months ago helped Transurban understand its customers in surprising ways.

The rate of vehicle accidents and confusion for motorists approaching the new managed lanes increased to levels higher than acceptable. It wasn't long before Transurban realized it had to respond to make a safe environment for its customers, Barr said.

The partnership of Transurban and the Virginia Department of Transportation went on to boost its communications efforts through surveys.

The responses suggested to Transurban that its previous concept of time being the most valued aspect of the toll road was narrow-minded; aspects of safety proved popular in feedback, Barr said, leading to a large media campaign and wider use of road signage and markings.

A dramatic reduction in incidents followed, Barr said, adding that the changes and responsiveness created value for the customer.

In Texas, another kind of barrier is being dealt with by implementing a compromise on the cost for its TollTag transponders.

Gerry Carrigan, CEO and executive director for North Texas Tollway Authority, said the benefits of transponder customers being able to also use them for parking and pass-through at Dallas/Fort Worth International Airport and parking at Dallas Love Field Airport were believed to be valuable enough to customers to increase TollTag penetration.

But despite those benefits, NTTA has been unable to break 80 percent penetration. The most-cited reason in surveys was infrequent use, Carrigan said.

The second-most popular answer was that customers were concerned about a $40 prepaid balance on a credit card, with another automatic $40 withdrawal when a balance reaches a certain level.

Identifying that barrier led to NTTA's new $20 "starter" tag, which will automatically adjust up to the higher cost if a customer's use escalates up to the $40 level in three months. It has yet to be gauged for its effectiveness in expanding TollTag sign-ups.

"It's the same product as our toll tag but has a $20 entry fee," Carrigan said. And it's variable, he added, so it provides convenience without the fear of chargers exceeding what the customer finds valuable.

SANDAG's FasTrak transponders generally cost a user a prepaid amount of $40. The penetration rate for their use on the South Bay Expressway is now about 72 or 73 percent, Johnson said.

Reaching that level was achieved in part by continual customer outreach, Johnson added, which led to some changes early in SANDAG's operation of the toll road and is inspiring other considerations.

"There are a lot of families who had an account, but they only had one transponder," Johnson said. "They weren't using the road as much as they could, and that's because to get that second transponder, that prepaid amount was going to go from $40 to $80."

SANDAG decided to make the per-transponder cost $20 for accountholders requesting more than one, while leaving the cost at $40 for single-transponder accounts.

Johnson said it was the smart way to look at it.

"Most families are going to want at least two transponders," he said, so a family wanting two could use road more efficiently and get both transponders without incurring additional cost.

"Huge growth" in transponder use followed, Johnson said.

Despite that push, Johnson said, growth is strongest in the credit card pay-as-you-go market. That leaves SANDAG considering another approach for meeting customers where they're comfortable: a mobile strategy.

Integrating mobile devices for account access and funding is on the wish list, but so is integrating the toll road experience with nonaccount holders.

"For those users who are truly only going to make the seldom trip, (they) might not have their credit card with them at the time, but don't want to get a violation," Johnson said.

So what's envisioned is a way to help customers pay with their cell phones.

"Right now we're trying to make sure we can operate what we have as efficiently as possible, but we are definitely looking at mobile strategies," he said.

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Gary Gallegos

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Tom Brown

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