by Martin DiCaro
Nearly five months after opening, the operators of the 495 Express Lanes are struggling to attract motorists to their congestion-free toll road in a region mired in some of the worst traffic congestion in the country.
Transurban, the construction conglomerate that put up $1.5 billion to build the 14-mile, EZ Pass-only corridor on the Beltway between the I-95 interchange and Dulles Toll Road, will let motorists use the highway free this weekend in a bid to win more converts.
“It takes a lot of time for drivers in the area to adapt to new driving behaviors. A lot of us are kind of stuck on autopilot on our commutes. That trend might continue for a while, too,” said Transurban spokesman Michael McGurk.
Light use of HOT lanes raises questions
McGurk says some drivers are confused about the new highway’s many entry and exit points. Opening the Express Lanes for free rides this weekend will let motorists familiarize themselves with the road, he said.
After opening in mid-November, the 495 Express Lanes lost money during its first six weeks in business. Operating costs exceeded toll revenues, but Transurban was not expecting to turn an immediate profit. In the long term, however, company officials have conceded they are not guaranteed to make money on their investment. Transurban’s next quarterly report is due at the end of April.
To opponents of the project, five months of relatively light traffic on Virginia’s new $2 billion road is enough to draw judgments. Vehicle miles traveled (VMT) has not recovered since the recession knocked millions out of work and more commuters are seeking alternatives to the automobile, according to Stewart Schwartz, the executive director of the Coalition for Smarter Growth.
“They miscalculated peoples’ time value of money. They overestimated the potential demand for this road,” said Schwartz, who said the light use of the 495 Express Lanes should serve as a warning. . . .Click here to read the rest of this excellent article.
While the new 495 express lanes are still in a 1-2 year ramp-up period (as the article suggests), the point made by Stewart Schwartz that the traffic and revenue forecasters may have mis-calculated the "time value of money" (TVM) for drivers is salient.
The same issue applies to the Dulles Toll Road as tolls escalate in the years ahead. In this case, the quarter-century record of the DTR facilities a better understanding of the TVM so the downward deviation from expected revenues will take awhile to reveal itself. Moreover, since the TVM assumptions in the DTR forecast were based in large part on experience of major regional growth over the last two-plus decades, the assumption could become less accurate in an era of federal budget austerity. Along with improvements in public transit (such as the Silver Line), fewer federal employees who are being paid less, fewer federal contracts to the area's usual corporate suspects, and state and local governments also stagnating or contracting their spending will all likely mean that more drivers will divert from the DTR to local roads. And that will mean more local congestion along the Dulles Corridor despite slower growth.