Corporate welfare and the Beltway HOT lanes, part 2: You better not carpool (too much)

Most press coverage of the Beltway HOT lanes has either touted the lanes or noted the high planned toll rates, up to $1 per mile. Project proponents counter the toll outrage by pointing out that commuters can carpool on the lanes for “free.” The correct term, however, should be taxpayer subsidized. The state have to pay Fluor-Transurban for each carpooling vehicle if HOV use exceeds 24% of total vehicles.

From the agreement:

(b) The Department agrees to pay the Concessionaire, subject to Section 20.18, amounts equal to 70% of the Average Toll applicable to vehicles paying tolls for the number of High Occupancy Vehicles exceeding a threshold of 24% of the total flow of all Permitted Vehicles that are then using such Toll Section going in the same direction for the first 30 consecutive minutes during any day, and any additional 15 consecutive minute periods in such day, during which average traffic for a Toll Section going in the same direction exceeds a rate of 3,200 vehicles per hour based on two lanes.

Based on the contract, state taxpayers suffer if our effort to rideshare is too successful. But just how much will we need to share in order to be punished? To use the existing I-395 HOV3 as a gauge, VDOT counted 30,000 cars per day in each direction. Assuming that on an average day most of those carpools drive within a 6 hour window, 395 would have 5,000 HOV3 vehicles per hour.

If we estimate that Tysons HOV3 use will be half as successful as I-395 is now, we could conservatively assume 2,500 HOV3 cars per hour in each direction. During peak times, this could well encompass more than 50% of the cars in the lanes. Fluor could charge taxpayers for half the carpool vehicles at the going rate, adding up to tens of millions of dollars per year.

This penalty doesn’t apply if Fluor-Transurban makes a 12.98% profit, but the more drivers carpool, the less likely it is they will make that profit.

As for buses, it remains unclear from the agreement whether or not they will cost the same as a car, or more. In Section 4.04:

(iv) The toll rates shall be the same for persons using the HOT Lanes under like conditions, and for this purpose “like conditions” may take into consideration type, weight and occupancy of the vehicle, number of axles, time-of-day and/or day-of-week travel, time and location of entry to the HOT Lanes, traffic congestion and other traffic conditions (provided, that the Concessionaire may adopt and implement discount programs for different classes or groups of persons using the HOT Lanes under like conditions, subject to the provisions of Section 11.01; and, provided further, that it is understood that, with dynamic tolling vehicles traveling on the same Toll Section of the HOT Lanes at the same time may be subject to different toll rates);

Buses weigh more and have more axles. If this provision allows for buses to be charged at higher rates, then bus trips could cost even more.

Ultimately, under this contract, if Virginia is too successful in reducing carbon footprint and traffic, or invests enough in express bus service, its taxpayers will instead be punished.