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Guardrails on Priced Lanes: Protecting Equity While Promoting Efficiency

Abstract

Can congestion pricing be implemented in a way that protects vulnerable residents of California? This report examines that question from two perspectives. First, we empirically estimate the size of the vulnerable population likely to be impacted if congestion pricing were introduced on California’s urban freeways. Our estimates suggest that 13% of households, as a result of their low incomes and current travel habits, might be unduly burdened by a freeway tolling program in California. Second, we consider ways to mitigate these burdens. In particular, we compare freeway use to use of other metered network infrastructure, like electricity grids or water systems. We suggest that assistance programs from these utilities provide a useful model for protecting low-income drivers from road prices, and further note that policymakers would be less constrained in progressively redistributing congestion toll revenue than they would be in redistributing utility revenue.

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