Friday, June 29, 2012

Orange County Toll Roads Cuts Jobs and Costs Because "Ridership" is Below Expectations

The LA Times reports on the Orange County toll road's budget problems. From the story:

Operators of Orange County’s toll-road network are planning to eliminate cash payments and toll-booth jobs as they try to squeeze more out of their financially strapped pay-to-drive highways.
Drivers who use the route 73, 261, 241 and 133 toll roads will need to have payment accounts linked to their transponders or their license plates in order to use the corridors. Cash payments will be phased out over the next 16 months.
The FasTrak transponders or the license-plate accounts electronically deduct money from a driver’s credit line.
In addition, a rate hike takes effect Sunday. Cash tolls will increase between 25 and 50 cents at most toll plazas and  FasTrak tolls will increase between 5% and 10%. Rates vary, depending on the time of day.
The changes, which will eliminate about 100 toll booth jobs, come about a year after the 73 toll-road project restructured its roughly $2.1 billion in debt. An agreement with bondholders requires the agency to hike tolls whenever feasible.
As ridership continues to fall below projections, leaders are looking for long-term, money-saving measures.
It isn't only transit that overestimates ridership! (Though roads tend to underestimate.)

I understand that toll roads are not doing that well as a private enterprise model in many areas. It isn't clear that this road isn't profitable, though. It is just below projections. The Toll Roads (the operators, you can like them on Facebook) regularly offer deals, giveaways and coupons to businesses as incentives to use their road. It is a bit of an odd model in that I am not used to getting a chance to win dinner simply by driving (and paying for) a particular route. I'm not sure if their marketing is successful, but perhaps there are some lessons about how transport can improve usage and service.
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