Capturing the True Cost of Driving

Road pricing places the true costs of driving — congestion, road maintenance, environmental damage, collisions — on people who drive.

Equitable road pricing

Equitable road pricing can be a powerful tool to simultaneously reduce driving, improve air quality and reduce emissions, make more efficient use of infrastructure, and create a new source of funding for more equitable transportation solutions.

To tackle growing traffic congestion, inadequate funding for transportation and the climate crisis, California’s cities and regions are looking to start or expand road pricing programs. These can include tolls, express lanes, downtown pricing programs and potentially a statewide per-mile road charge to replace the gas tax.

Transform is deeply engaged in ensuring community voices and values are at the heart of any new pricing programs.

Transform is leading a statewide coalition to ensure any future statewide Road Charge includes low-income discounts, incentivizes cleaner vehicles, and provides funding for both road maintenance and alternatives to driving (see PPT).

Transform is also deeply engaged in regional pricing and express lane implementation. The primary goals are to avoid expanding highways and instead convert existing lanes to priced lanes that include equity programs. For example, Transform led the successful advocacy for San Mateo County’s Community Transportation Benefits Program, which uses express lane funding to provide low-income residents with either $200 in public transit benefits or $200 on their Fastrak that can be used in the express lanes.

California’s past transportation decisions have made inequality worse.

In California, policy choices and investments in our transportation system have created and reinforced a fundamentally inequitable transportation system that is the state’s largest — and growing — contributor to greenhouse gas emissions. Since the 1950s, California’s emphasis on moving cars quickly, combined with sprawling land use patterns, has imposed steep costs on vulnerable communities. As a result, lower-income and BIPOC communities now spend a much higher percentage of their income on transportation and are disproportionately exposed to transportation-related pollution than the average Californian. 

Along with cleaner vehicles and low-carbon fuels, the path to carbon neutrality depends on reducing per capita VMT and developing new transportation funding mechanisms that don’t rely on declining gas tax revenues.

How does road pricing work?

Charge the True Cost for Driving

Road pricing is based on the economic principle that, when people have to pay the true cost for something, they use it more efficiently. The true costs of driving are not just reflected in construction and maintenance expenses or what people pay in gas taxes; they also include the external costs of congestion, pollution, property destruction, and injuries caused by collisions, to name just a few.

Incentivize Other Modes and Reduce Congestion

When road pricing reflects some or all of these costs, people may move some of their trips to off-peak times, choose different destinations, switch modes, or consolidate their trips, reducing the pressure on roadways. Those who pay for access enjoy a faster, more reliable trip. Even a relatively small reduction in the number of vehicles on a congested road can improve a road’s throughput, significantly reducing delays for everyone.

Fund a Better Transportation System

Pricing also generates revenue, which can be used to maintain existing roads, fund public transit or active transportation, or something else entirely, like affordable housing close to transit. How that revenue gets spent is very important: if implemented without a clear focus on social and racial equity, it can deepen existing inequities in our transportation system and exacerbate the climate crisis.

Types of Pricing

Toll and Express Lanes

By putting a price on individual lanes or specific highways, these projects charge all vehicles for passage. Express lanes use dynamic pricing to more effectively manage congestion. Some toll lanes offer free passage for high-occupancy vehicles and discounts for lower-income drivers.

Road Charge

A road charge, also known as a vehicle miles traveled fee, is a “user pays” system where all drivers pay based on how much they drive. California is currently piloting a statewide road charge to replace the gas tax.

Congestion Pricing

Congestion pricing, also known as cordon or area pricing, charges drivers a fee to enter or circulate within a defined zone. Congestion pricing was recently implemented in New York City, while London, Stockholm, and Singapore have used this kind of road pricing for years to achieve positive transportation, public health, and equity outcomes.

Advancing equity and climate through road pricing

Free roads, with congestion and pollution that disproportionately harm vulnerable communities, are cornerstones of a system that fuels the climate crisis. As outlined in Transform’s Pricing Roads/Advancing Equity, there needs to be a dual focus to ensure social equity is part of every road pricing program.

Lift up community voices

Equity needs to be at the heart of the process as well as program design and expenditures. From conception to implementation, marginalized groups must be centered in the decision-making process. If we listen to community voices, engage community expertise, and work collaboratively to develop more affordable, accessible, and healthy transportation options, road pricing can be a critical element of a more just, sustainable transportation system where everyone has the opportunity to thrive.

Equitable implementation

Equitable, effective road pricing strategies can redress the structural inequity in our transportation system and fund the sustainable transportation alternatives we need. With targeted discounts, credits, and cap programs for low-income drivers, and investments in alternatives to driving rather than expanding highways, road pricing can deliver a wider range of mobility options that are fast, frequent, and affordable, improving Californians’ access to economic, recreational, social, and other opportunities.

More About Road Pricing

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