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‘Lexus lanes’ and the price of saving time

Kenny Malone Mar 4, 2014

‘Lexus lanes’ and the price of saving time

Kenny Malone Mar 4, 2014

Here’s how dynamic tolling, the so-called ‘Lexus lane,’ is supposed to work: You raise the price of admission during peak periods, and fewer drivers will ride in that lane.

“That day you paid $7, we’re trying to get you not to go there,” says traffic engineer Rory Santana, who’s been running the I-95 express lanes in Miami since they opened five years ago.

But some unforeseen driver behavior has slightly complicated that model. Over the last several months, record numbers of drivers have been willing to shell out the maximum toll of seven bucks. And that’s been a problem for Santana.

“If it’s $7 and everybody piles in,” he says, “we lost our opportunity to try and keep the speed up and keep the flow going.”

The relationship between prices and congestion on Miami’s I-95.

Part of the problem appears to be a phenomenon documented on Minnesota’s MnPASS system, after which Florida’s I-95 Express plan is modeled. Engineers found that, up to a point, drivers are actually drawn to higher tolls.

“And that’s surprising,” said David Levinson a professor of civil engineering at University of Minnesota and a study author. “Our expectation was that when we raised the price, that fewer people would consume the good … which is what you typically find.”

He says you don’t normally think about driving on high-occupancy toll lanes as a prestige good, where people perceive more value as the price goes up.

On the other hand, Levinson says, maybe there is a real value. “So if you’re a ‘type-A’ person you might get some sort of psychological benefit from passing 20 other cars on your way to work. Even if by passing 20 cars you’ve only saved yourself a minute or two, you’re ahead in the race, so as a positional good you think it’s better.”

And for the record, express lanes may or may not be “better” as the price goes up. Dynamic tolling changes to ensure free-flowing traffic in the express lanes — it has nothing to do with what’s going on in the not-so-express lanes. 

Economist Tony Villamil with the Washington Economics Group says there’s now a willingness to pay, he says, is a refusal to wait. “Maybe 20 years ago people would say ‘Why not take the more congested route?’ Time was not of essence like it is today in the business world.”

Villamil says it’s further evidence that the value of a second is higher than ever.

Take Kevin Cerino, whose daily mission is to get home as quickly as possible. Cerino. At 4 PM on the nose, Cerino leaves his job at the University of Miami medical school to start the journey home to see his wife, 3-month old son, and 18-month old daughter.

Every minute Cerino wastes in traffic cuts into that precious family time. But when he reaches the I-95 onramp today, an electronic sign tells Cerino his fate.

“It looks like the toll is $7, so I’m not taking the express lanes today.”

Instead, it takes him an extra 30 minutes to get home. And the thing is, it wasn’t the money that scared him off from the express lanes. Cerino learned that when the 95 Express lanes were at their $7.00 max, authorities had clearly lost control of congestion.

“The one thing I wish I had more of was time,” he says. “It’s not money, it’s not a better job or a better car. It’s just I wish I had more time.”

It’s something Cerino hopes will improve once the top rate goes to $10.50.

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