HOT Lanes Yes, Cordon Charges No

Denver converted some high-occupancy vehicle lanes to high-occupancy toll (HOT) lanes in 2006. A new review from the Institute of Transportation Engineers finds that they have been highly successful.

On the other hand, the congestion charge being used in London isn’t doing much to relieve congestion. In fact, according to one report, congestion “is spiraling out of control.”

On the Denver HOT lanes, tolls vary by the time of day, ranging from 50 cents to $3.25. But the FTA, which provided part of the funding to start the program, requires that buses using the lanes never face congestion, so the tolls will increase if traffic grows.

After a year, the lanes attracted more than 80,000 tollpayers a month on top of the 200,000 or so high-occupancy vehicles that use the lanes for free. Revenues greatly exceed the original forecasts, and the lanes are better utilized, thus taking pressure off of adjacent free lanes.

Meanwhile, the London program is a “cordon charge,” a fee people have to pay for crossing a line into inner London. The fee does not vary by time of day, so it is not a true congestion charge.

A new paper from London conservatives says that London congestion is getting far worse in spite of the congestion charge. The paper is interpreting the “spin” from report from the city of London.

The city report, notes the conservatives, claims that the congestion charge has reduced the number of cars entering the pay zone by 30 percent. But this is an exaggeration because it ignores the 16 percent increase in vehicles exempt from paying the charge, “so the true reduction is only 14 percent.”

Moreover, page 270 of the city report notes that traffic congestion grew by 15 percent between 2005 and 2006 alone. How can that be if cars are reduced by 14 percent?

The answer can be found on page 22 of the city report:

The graph shows that nearly all of the reduction in traffic has taken place during the off periods. Peak-period traffic is hardly depressed at all.

This is actually not surprising. Economic theory would say that the demand for travel at rush hour is more inelastic (i.e., less susceptible to fees) than travel at other times of the day. (If it were not inelastic, people would be willing to drive in such congestion.) If fees don’t change during the course of the day, they will have the greatest effect during the hours that are more elastic. A properly designed fee should temper peak-period demand; a fixed fee instead tempers off-peak demand.

New York’s Mayor Bloomberg has proposed to apply a London-like congestion charge to cars entering Manhattan. He may actually think this is an economically intelligent thing to do. It is not. Only fees that vary by time of day, or better yet by the amount of congestion, will really solve the congestion problem.


16 thoughts on “HOT Lanes Yes, Cordon Charges No

  1. davek

    On behalf of the pro-planners,let me be the first to say that I have previously dismissed your claims, and I require you to provide even more and better evidence that will also be unacceptable because you are a poopy-head and you wear a funny tie.

  2. theplanner

    congestion charging is something that most planners and economists can agree on, although the arguments of course arise when expensive rail is proposed instead of highway expansion. unless one belives that demand and supply price elasticities dont exist, otherwise congestion charging is one of the best mechanisms to control peak highway demand, while also making substantial revenues, which probably should go into highway improvements.

    as to davek’s comment, well i think we should probably screen children from making comments on this page.

  3. Francis King


    there is a major problem in your analysis. You have taken no account of the political leanings of the people involved.

    Ken Livingstone, the very controversial mayor of London, was in the Labour Party, and when he contested the post of mayor he was expelled. The public were advised, by Tony Blair no less, not to vote for him, because he would be a disaster for the city. When he made a good job of it, they changed their mind and he is back being a member of the Labour Party.

    The paper was by London Conservatives (not conservatives). They are also a political party, and want to expel Ken Livingstone, and replace him with their own candidate. So, funnily enough, they think that the congestion charge is a big mistake – it is easily the project with which Ken Livingstone is closely associated.

    You are right that a more varied charge would be better, say £15 ($30) in peak periods, and a lower charge, say £5 ($10) at other times. However, I get the increasing feeling that Mr. Livingstone is working very carefully at what he thinks he can get away with. The latest idea is to increase the charge to £25 ($50) for cars with the highest fuel consumption – what would be called an SUV in your country. It is very popular. Why? Because it will raise lots of money, and only a few people will be affected (SUV ownership is a minority interest in the UK). But, if he increased the charge in peak periods, this might well be unpopular, as it would affect too many people.

    In any event, there are better ways of reducing congestion. Removing from the road the 1.5 million illegal cars in the UK would be a good place to start. Making public transport fun is another good thing – unlike buses, airplanes in the UK are very popular, and they’re public transport too. Flexi-time and work-from-home are possible. And many people would do themselves a favour by ditching a car – the average car in the UK costs £5500 ($11,000) a year to run. I wonder how many families can’t afford nice holidays, paying off their credit cards, or a better neighbourhood, but they have two or three cars. All that together, and a few other important things, could achieve an equivalent reduction in congestion.

    PS: Toll motorways/freeways look like a really nice way of getting something (a road) for nothing (no charge to the taxpayer), particularly when it parallels an existing road, giving the motorist a real choice.

    Francis King
    Transport Planner, UK

  4. Veddie Edder

    There is a particular angle to Manhattan’s congestion problem (and this plan relates only to Manhattan) that is lost in a lot of the press, and is likely inapplicable to London’ experience. Manhattan sits at the center of a metro area. A great deal of commerce in the NYC area is suburb to suburb. I understand that at any given tiem 25% of the traffic on Manhattan’s streets is traffic that is neither originating in nor bound for Manhattan. For example, if I’m travelling from Queens to Newark, the shortest trip by far is via Manhattan. These are trips that are very difficult to place into mass transit because the system is simply not designed to connect suburb to suburb, and in any event a mass transit trip across the various lines indirectly connecting, sya, Queens and Newark, would still require the rider to travel to and transfer in Manhattan. Bottom line: NYC can vacuum up about 25% of the traffic from its streets, build connectivity and limit pollution and aggravation by simply building crosstown routes that run on underground or elevated roads. Note that congestion pricing – by the very terms of the plan – only seeks, if everything goes its way to reduce congestion by 6%. You can get four times the traffic benefit, add commerec and evactuation routes in the bargain by building adequate infrastructure, without an intrusive tax and related surveillance apparatus. What NYC needs is updated 21st century infrastructure, what this plan promises is ever-increasing congestion with a new tax backed by myriad surveillance cameras.

  5. Dan

    The idea is to reduce discretionary trips during peaks to reduce congestion.

    Whether the New York Mayor’s idea is bad or not cannot be addressed by showing London’s trip counts.

    Unless, that is, you can prove London’s traffic is largely similar to New York’s.

    If you cannot do that, your premise is false and the argument is weak at best. I do not see evidence in this post that London’s traffic is similar to New York’s.

    In fact, I see exactly zero NY traffic data in this post, which strikes me as odd – it is similar to talking about the Blazers’ offensive woes by showing the Sonics’ statistics.

    That said, I am generally for variable congestion tolling, with higher charges during peaks to reduce discretionary trips. But not knowing how many discretionary trips into Manhattan there are (I suspect there are some but not many), I can’t speak to the issue as to whether Bloomberg’s idea is a good one or not. And neither should you, Randal.


  6. Lorianne

    I have a good friend who lives just outside of London. She would like to take the Tube into work but at the hour she would have to board it’s still dark much of the year. There is a big problem with YOBs robbing and harrassing people, especially women, and especially at night pre-dawn hours. So it becomes a security issue for her. My friend sees the congestion fee as a tax on working women.

    Her solution: If they would put more police (and ARMED police) on the trains it might actually make a bigger impact reducing congestion than charging a congestion tax.

  7. Unowho

    “And many people would do themselves a favour by ditching a car…”

    And if the silly buggers don’t know that they would be doing themselves a favour, we’ll decide for them! Right?

    As for the two plans, Livingstone stated in a Guardian interview that NYC’s congestion pricing plan was modelled on London’s. Bloomberg said the same thing in a joint press conference.

    To the extent that there is any data regarding the NYC plan, it can be found in the State Senate report issued last summer (available online) that recommended against adoption. However, a deal was struck and NYC will now get some form of congestion pricing in 2008. One good thing: future modifications to the plan will be the result of vote-buying and horse-trading, at least a far more honest process than what has gone before.

  8. davek

    …as to davek’s comment, well i think we should probably screen children from making comments on this page.

    This is much funnier than what I wrote. The Antiplanner provides a comments section on his blog, and a participating planner decides that he (the planner) is part of some “we” that can dictate who can post. Silly planners… there’s no we here. You’re wise not to screen, Randal. Your opponents do a great deal of your work for you.

  9. theplanner

    well you are a smart one arent you davek, im not actually a planner. you assumed i was because i used the name the planner. the name was just an amusing choice. i’ve taken several planning courses, but i’ve taken even more economics courses. and my comment was mostly sarcastic. maybe a smily face would have gotten that across, but the point was your comment was childesh.

    the “we” was a typo, and whether your sarcasm was meant to insult planners or not, it came off as child like and simple minded. i agree dont screen randal. unfortunately some of your supporters (davek) pretend to be a planner and write stupid comments, but we can let that be a cost of the free market. one of the benefits is that ive learnt not to post stuff that goes too far off topic (after this post) because some people like to go into endless off topic debates about esoteric, winy, or jargon crap competitions.

  10. davek

    All right, all right… don’t blow things out of proportion. My attempt at satirizing pro-planners missed the mark. I made a lame joke, and I hope you don’t take the view that anyone who does that is childish and simple minded. You may even have done the same thing once or twice yourself. Read any of my previous posts, and you will see that we are on the same side, so let’s not let a misunderstanding spiral out of control.

    My apologies to all for this debacle. I’m sure the pro-planners have enjoyed it to no end.


  11. Dan

    As for the two plans, Livingstone stated in a Guardian interview that NYC’s congestion pricing plan was modelled on London’s. Bloomberg said the same thing in a joint press conference.

    I fail to see how this shows London’s traffic is similar.

    To the extent that there is any data regarding the NYC plan, it can be found in the State Senate report issued last summer (available online) that recommended against adoption.

    Report not on the Senate website or on The Internets that I can see (surely you have a link). The press coverage indicated economic justice as the reason Senate said no, which may be an incorrect assumption.

    So we still have Randal’s argument as fallacious due to a false analogy. Until, that is, Randal coughs up the evidence he used to make the equivalence.


  12. aynrandgirl

    The addition of congestion pricing is exactly why NYC won’t create crosstown routes. As long as it can raise huge amounts of toll revenue, very little of which (mark my words) will be used to expand the road system, Manhattan won’t dare allow any road routes that bypass it no matter how sensible that might be in terms of actual congestion relief. That’s the problem with the large central cities these days. In order to mandate relevance for themselves, they want everything to flow through them despite the obvious fact that moving everything through one central hub maximizes congestion.

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