Commercially managed road funds: managing roads like a business,not like a bureaucracy

Nearly all countries are seriously short of revenues for investment and maintenance of roads. Improving utilization of the existing road budget has helped to narrow, but not eliminate, this financing gap. Requests for additional resources from the government's budget have fallen on deaf ears, because the road sector has grown too large to be fully-financed through general tax revenues. Government tax systems were not designed to finance major economic sectors like roads. Faced with an acute shortage of funds, many road agencies have introduced tolls on high-volume roads and have invited the private sector to build and operate such roads under concession agreements. Although this has narrowed the financing gap, tolling is only economic on a small part of the road network. Tolls have thus had a relatively small impact on the financing gap. Against this background, and mindful of the fact that roads are now 'big business' on the scale of the Fortune Global 500, a growing number of countries have started to 'bring roads into the market place, put them on a fee-for-service basis and manage them like a business.' The fee-for-service concept, though superficially like the user-pay principle and the associated road funds which became popular during the 1950s, differs from user-pay in a number of important respects. The key differences are that: (i) only road user charges go into the road fund (i.e., there are no earmarked taxes); (ii) the fund is managed by a representative board with half or more members representing road users and the business community; (iii) members are nominated by the constituencies they represent and there is an independent chairperson; (iv) financing arrangements are designed to ensure that money is not diverted from other sectors; (v) funds are managed pro-actively by a small secretariat; (vi) there are published financial regulations governing the way funds are managed; (vii) charges are adjusted regularly to meet agreed expenditure targets; and (viii) there are regular technical and financial audits. Other important characteristics are that most commercially managed road funds are managed through a separate road fund administration, funds are channeled to all roads (sometimes even to unclassified roads) and they are introduced as part of a wider agenda to commercialize road management. Some of these road funds have been set up as road public utilities under a board with powers to set their own tariffs.     

Road Safety Trends at National Level in Europe: A Review of Time-series Analysis Performed during the Period 2000–12

Abstract

This paper presents a review of time-series analysis of road safety trends, aggregated at a national level, which has been performed in the period 2000–12 and applied to European national data sets covering long time periods. It provides a guideline and set of best practices in the area of time-series modelling and identifies the latest methods and applications of national road safety trend analysis in Europe. The paper begins with the methodological framework adopted for aggregate time-series modelling that will be considered, and then discusses a number of relevant applications to long-period data aggregated at the national level, whether for countries alone, or for groups of countries. Some analyses, which were performed at the disaggregated level, are also provided, as they are being used more and more. Finally, the paper summarizes and discusses the significant changes in aggregate road safety trend analysis which occurred during the period and provides recommendations for continuing these research efforts.     

Highway pricing and capacity choice in a road network under a build–operate–transfer scheme

It is often argued lately that the private sector should be allowed to build and operate roads in a transportation network at its own expense, in return it should receive the revenue from road toll charge within some years, and then these roads will be transferred to the government. This type of build–operate–transfer (B–O–T) projects is currently fashionable worldwide, especially for developing countries short of funds for road construction. One of the important issues concerning a highway B–O–T project is the selection of the capacity and toll charge of the new road and the evaluation of the relevant benefits to the private investor, the road users and the whole society under various market conditions. This paper deals with the selection and evaluation of a highway project under such a B–O–T scheme. For a given road network with elastic demand, mathematical models are proposed to investigate the feasibility of a candidate project and ascertain the optimal capacity and level of toll charge of the new highway. The response of road users to the new B–O–T project is explicitly considered. The characteristic of the problem is illustrated graphically with a numerical example.     

Tolls,Terms and Public Interest in Road Concessions Privatization: A Comparative Analysis of Recent Transactions in the USA and France

Abstract

Recent concessions in France and in the USA have resulted in a dramatic difference in the valuation placed on the toll roads; the price paid by the investors in France was 12 times current cash flow whereas investors paid 60 times current cash flow for US toll roads. In this paper, we explore two questions: what accounts for the difference in these multiples? and what are the implications with respect to the public interest? Our analysis illustrates how structural and procedural decisions made by the public owner affect the concession price. Further, the terms of the concession have direct consequences that are enjoyed or borne by the various stakeholders of the toll road.     

Preventing death and injury on the world's roads

The problem of deaths and injury as a result of road crashes is now acknowledged to be a global phenomenon with authorities in virtually all countries concerned about the growth in the number of people killed and seriously injured on their roads. The World Health Organization has declared that its annual World Health Day in 2004 will have the theme 'Safe Roads', and several organizations, including the World Bank and the Global Road Safety Partnership, are supporting this initiative to raise the profile of road safety in the public and political minds.     

Sharing costs in Swedish road ownership associations

Usually transport systems, and roads in particular, are viewed as public goods. However, this is not always the case. In Sweden a large part of the road system is privately owned. Most of these privately owned roads are rural roads used by farmers and summer cottage owners, or used for forest transport. These roads are mainly provided by ownership associations.An important difference between public roads and these privately owned roads is that all investments- and maintenance decisions are made by the users themselves, who also have to pay the costs, whereas the usual case is that the owners/providers of a road-system are different agents than the users. Here the question is not how to charge the roads but how to split the costs of the roads among the users in an efficient and “fair” way.The motivation of this paper is the practical problem of how such an ownership association can divide the costs for the road network among the members in an efficient and “fair” way. The problem is treated from a game theoretical point of view, making use of the Shapley value. This means that the problem is associated with a game - a mathematical representation of the conflict situation. The Shapley value is a very important solution concept for cooperative games, like the game in this case. For games corresponding to this specific type of problems, it is shown that the Shapley value has excellent properties, such as beeing an element of the core, and beeing very easy to compute.     

Hierarchical network-based equilibrium model and algorithm for a mixed-traffic urban transport system

Abstract

Many equilibrium models and algorithms based on homogeneous motorized traffic have been devised to model urban transport systems in developed countries, but they are inadequate when it comes to represent mixed-traffic urban transport systems, including automobiles, transit, bicycles, and pedestrians, in developing countries such as China or India. In these cases, traffic flow on a road segment is an aggregated result of travellers' combined mode/route choices and corresponding interactions. Therefore, a special assignment model and algorithm are needed for modeling these distinct behaviors. In this article, the structure of a mixed-traffic urban transport system is analyzed and then expanded and represented using a hierarchical network model based on graph theory. Based on the analysis of travelers' combined mode/route choices, generalized travel cost functions and link impedance functions for different modes are formulated, where the interferences between different modes on the same road segments are taken into account. Due to the ‘asymmetric’ nature of these functions, a variational inequality model is proposed to represent the equilibrium assignment problem in a mixed-traffic urban transport system. The corresponding solution algorithm is also presented. Finally, a numerical example is provided to illustrate the practicality of the proposed model and algorithm.     

Modelling greenhouse gas emissions from cars in Great Britain

This paper outlines the issues involved in the problem of global warming. The road transport sector's contributions to this problem are then detailed and various policy options to reduce greenhouse gas emissions from private cars are discussed. The paper then describes a model which forecasts greenhouse gas emissions from cars. The effects of various policy options are then modelled and the results compared. Policies considered include: raising fuel prices in terms of the UK government's commitment to increase road fuel duties; subsidising public transport in terms of reduced public transport fares; and a tax differentiated by engine size.     

Measuring Success of PPP Transport Projects: A Cross-Case Analysis of Toll Roads

Abstract

The aim of this paper is to measure ‘overall’ success of a public private partnership (PPP) transport projects using four case studies. All four case studies are PPP toll roads from four different EU countries (UK, Spain, Portugal and Greece). The case studies have been analysed using a manual Qualitative Comparative Analysis approach. According to the paper, three different perspectives have been used to measure the success of a project, that is, project management perspective, stakeholder perspective and contract management perspective. The ‘overall’ success has then been deduced by bringing these three perspectives together as a holistic approach. The findings are presented in the form of a matrix and the final outcome of the paper shows a simple methodological approach that can be used to measure success of a PPP transport project. Since the study takes more of a qualitative approach, researcher bias and perceptions have a major role to play in the final outcome. However, to reduce ‘biasness’, quantitative measures have also been used to quantify the Key Performance Indicators and performance measures in the case studies. It is hoped that the study makes a valid contribution to the areas of transport PPPs and performance measurement.     

The trade‐off between efficiency,effectiveness, and social feasibility of regulating road transport externalities

This paper discusses the tension between the theory and practice of the regulation of road transport externalities from the viewpoint of the trade‐off between efficiency, effectiveness and the social feasibility of regulation. Various possible types of regulatory instruments, subdivided into ‘direct’ demand management, ‘indirect’ demand management and ‘supply side’ oriented policies, are evaluated qualitatively according to these criteria. Attention is then directed towards the trade‐off between efficiency, effectiveness and feasibility within the field of ‘direct’ demand regulation of road transport.     

Impacts,management and functional planning criterion of forest road network system in Turkey

In this study are proposed impacts, management and functional planning criterion of forest road network system in rural and urban landscapes of Turkey. Road spacing and road density have been inspected concerning forest roads in production, reforestation, national parks and protection forests of rural and urban landscapes of Turkey. The forest road network was the most expensive human activity in the forests both in terms of economics and environmental effects. Public opinion about the environment has increased in recent years. Sustainable land use planning creates a great challenge for rural and urban road network planning. Further improvements of the network are necessary, to provide for people’s needs in the near future. Harmful effects of road network conflict with the principles of sustainability. When making use of the forest ecosystem for various purposes, care must be taken not to spoil the forest structure. To achieve this, forests must be used according to forestry techniques. So, there is a need for a new planning approach, serving the interests of both accessibility and sustainable environment. In rural landscapes, forest road planning standards (slope, width, pavement, drainage etc.) are different in production, forestation, national parks and protection forests. The need for total forest roads in Turkey was 201,810 km, and that 133,693 km portion of which, corresponding to 66.25%, was constructed by the end of 2005. With a view to be capable of conducting modern forestry activities, our country’s forests should be provided with a systematic road network by completing as soon as possible the construction of the remaining portion of such roads.     

Special issue on intelligent transportation systems,big data and intelligent technology

ABSTRACT

Based on the increasing demands of transportation development, the concept of an Intelligent Transportation System (ITS) has received increasing attention in both academic and industry arenas. It integrates information, communications, computers and other technologies, and applies them in the field of transportation to build an integrated system of people, roads and vehicles by utilizing advanced data communication technologies. It can establish a large, fully functioning, real-time, accurate and efficient transportation management system. Intelligent transportation systems shift the focus from road managers to road users. In order to achieve this purpose, intelligent transportation systems use advanced technology to provide drivers with convenient information to help reduce traffic congestion and to increase available road capacity. This special issue is dedicated to exploring the most recent advances in intelligent transportation systems and big data based on intelligent technology.     

Agricultural vehicles and sustainable safe road traffic: solving conflicts on arterial highways

Addressing the issues of traffic safety in rural areas presents a constant challenge. The mix of light and heavy vehicles and the considerable differences in speed among these traffic participants result in high risks and delays for the faster vehicles. Agricultural vehicles (AVs) in particular have such an impact on traffic, especially when using arterial highways. This paper reviews the problems of safety and delays that AVs cause on arterial highways, and the appropriate mitigation. The concept of 'sustainable safety' in The Netherlands focuses on these problems, because of the proposed construction of parallel roads alongside all arterial highways. However, Dutch accident statistics cannot justify the high costs for the construction of parallel roads alongside 7000 km of arterial highways. Delays experienced by fast traffic are another reason for separating AVs from other road users with parallel roads. Alternative measures alongside the arterial highway, such as passing bays, restricting AVs to travelling at off-peak only and improving the conspicuity of the AVs, may be more cost-effective ways of reducing delays and/or improving traffic safety on arterial highways. Another solution may be to eliminate the need for AVs to use the arterial highway by altering their routes. For this purpose, land reallocation projects (as practised in Holland) can provide a useful tool.     

New models for financing and managing highways: asset-based road corporations in China

The China International Engineering Consulting Corporation undertook, in 1997, the study of Viability of Asset Based Road Corporations in China as part of the World Bank's transport sector program review. The purpose was to investigate, in a case study format, road administration in China with two specific objectives: to compare (toll) road management in different provinces and to investigate the financial viability of China's toll roads.This paper shows that the three case projects studied, each having different management structures, are all financially viable given the present financing arrangements. However, should the projects be immediately subject to market interest rates and loan maturities prevailing in China today, their financial viability would be uncertain.In a broader context, the World Bank's lending program has enabled China to experiment with different kinds of toll road management structures. These models have both advantages and disadvantages and seem to fit that province's political economic environment in which they are employed. The toll roads and, especially, the impacts of the toll road management and financing arrangements on road administration present challenges to road administration rarely faced even in the developed countries. The challenges involve questions of the congruence of public good and private interest, as well as the role of planning and public accountability – all serious questions as China moves forward in development. These questions are raised in the context of the case studies.     

Spatial differentiation,transport demands and transport model design in Kuwait

Foreign consultants still provide much of the analytical expertise for transport planning studies conducted in the Gulf States and other rapidly developing countries. Most of the systems analysis techniques used are adaptations of those developed for western urban areas. The populations of the Gulf States are unique in that they contain very large populations of foreign workers who have very different social and economic characteristics from the national populations. This paper describes these differences and shows how they have influenced the spatial evolution of the Kuwait metropolitan area and the associated transport demands. The paper also describes the analytical tools that are most appropriate for capturing the transport behaviour of residents of the Kuwait metropolitan area.     

The New Zealand experience in restructuring road administration New Zealand road reform

Reform in the public sector in New Zealand saw the abolition of the Ministry of Works and Development in 1988, with the commercial activities being transferred into a Government owned company. Further reform saw the client function of roads transferred initially into the Ministry of Transport and then into an independent Crown agency known as Transit New Zealand. Transit New Zealand is led by an Authority of six members, appointed by the Government, and it administers the strategic (national) road network (10,500 kilometres).In 1996 a separate funding body, Transfund New Zealand, was established to distribute funds to Transit New Zealand and local authorities. Transfund New Zealand is funded through a share of the petrol excise, all vehicle registration and licensing fees and all road user charges (an axle-weight/distance charge levied on diesel vehicles, especially trucks). These revenues are paid into a dedicated National Roads Fund, which allows a measure of transparency in funding the road system. The reforms in New Zealand have resulted in large efficiency gains, with no measurable lowering in level of service.The road agency of the future is discussed, along with possible changes in road management.     

Modeling Capacity Reliability of Minor Roads at At-Grade Un-Signalized Intersections for Potential Performance Evaluation

Abstract

Given stochastic features of the demands on both the major road and the minor road at an at-grade un-signalized intersection, the capacity of the minor road is viewed as the vulnerable and critical part impacting on the overall capacity of the intersection. To facilitate the analysis of intersection performance reliability, the capacity reliability of the minor road is defined as the probability that the capacity of the minor road can accommodate a certain traffic demand at a certain degree of saturation. The headway distribution of traffic stream on major road is reflected by three types of distributions, namely, exponential distribution, shifted exponential distribution, and Cowan's M3 distribution. Based on field observations, the volumes on both major roads and minor roads are treated as correlated normal random variables. This paper presents the methods for modeling capacity reliability of the minor road at an at-grade un-signalized priority intersection. A method based on first-order reliability method is used to model the capacity reliability index. As important associated factors of capacity reliability analysis, the methods for modeling and analyzing capacity sensitivity of the minor road and reserve capacity of the priority intersection are also presented. A procedure for evaluating the intersection potential performance using capacity reliability, sensitivity and reserve capacity is developed and demonstrated with a numerical example. Finally, some new findings from the case studies are summarized.     

A Review of the Evolution of Shared (Street) Space Concepts in Urban Environments

Abstract

This paper aims to clearly establish the origin and evolution of the shared space concept from a New Zealand perspective by reviewing the literature in the disciplines of both urban design and transportation engineering. The review process involves investigating the use and function of a public road space in the context of the changing of public expectations and how this can relate to a number of interconnected street design approaches (e.g. traffic calming and self-explaining roads (SERs)). These approaches have been used to minimise the influence of motor vehicles since the beginning of the automobile era. The shared space concept, when applied in public road environments in activity centres, has increasingly been embraced by urban planners, transportation engineers and regulatory agencies. A shared space diverges from a conventional road where all road users are encouraged to legitimately occupy the same road space with little physical separation. To achieve this in a safe and efficient manner, the design aims to reduce the dominance of the motor vehicle by promoting pedestrian and cycling activity and utilising the road space as a ‘place’ in addition to its ‘transport’ mobility and access purposes. Given the fundamental conceptual differentiation between a traffic-calmed street and a shared space, the paper argues that there are certain design elements, constituting a shared space, and without them, it would be difficult for a public street to function as a genuine shared space for all road users.     

Experience in judging controversial road projects

Abstract

Road construction of all kinds, especially of urban motorways, has in recent years acquired a very bad reputation in industrialized countries. Traffic engineers are, because of their attitude, not entirely without blame for this development. With their attention glued nearly hypnotically to dimensions and technical design, considerations about the meaning and function of the construction are very often neglected, all the more since the engineers might otherwise risk their own jobs. It is, however, becoming increasingly clear that the cause of the scepticism and uneasiness prevailing in the public is the lack of a comprehensive judgement. Using a concrete example, this paper describes how decision‐making can degenerate when such judgement is omitted. Using a second example, it is then demonstrated how such a comprehensive judgement can be integrated in decision‐making from the very beginning. Such an integration sets very high methodological and procedural standards and constructive aids are offered for this purpose. It is shown that, while the substantial findings of a comprehensive judgement should be logically consistent, plausible and up to the latest standard of knowledge, the nature and intelligibility of the presentation and the preparedness for a publicly presented explanation in the form of ‘after‐care’ are of much greater importance for decision‐making in the political sphere. This ‘after‐care’ should accordingly become an indispensable component of the decision‐making process.

All those involved should become aware of the fact that a ‘positive’ result of decision‐making in the field of road construction is not a priori defined as the construction of road and a ‘negative’ one as its prevention. The actual positive result is rather the creation of a consciousness of the problem on hand, which can serve as a basis on which a decision is taken in full realization of all its consequences.