Is congestion pricing equitable? Data suggests “yes” in the Portland metro region

By Rayla Bellis

Critics of congestion pricing sometimes raise equity as a concern. They question whether charging a higher fee during congested times of day places a disproportionate burden on lower-income individuals who may have no choice but to travel during those times.

Economist Joe Cortright recently tested this claim using data from the Portland metropolitan region and found the opposite: according to Cortright, the data suggests that peak hour road pricing would primarily impact individuals with the highest incomes.

Cortright conducted his evaluation in response to recent state legislation giving the Oregon Department of Transportation authority to develop a value-pricing system for interstates in the Portland metropolitan area. This will mean charging drivers who use the freeways a higher toll during peak hours, providing an incentive for travelers to shift trips to other times of day.

Cortright and his team used data from the American Community Survey to assess commuting choices and family income for the Portland metropolitan area, drawing from the five-year 2011-15 sample, which includes all adults (aged 18 and older). They compared family incomes of those who travel to work by car with incomes of adults who are either not working or travel to work by other modes. They also looked at the income of those who travel to work by car during peak travel hours versus those who travel to work by car during non-peak hours, treating people who regularly leave for work between 7:02 AM and 8:02 AM as “peak” travelers and everyone else as “non-peak.”

The results indicate that the median family income of individuals who travel to work by car ($73,600) is considerably higher than the median household income for those who take transit (just under $45,000), those who walk or bike to work (just over $42,000), and individuals who aren’t working (just under $40,000). Meanwhile, the median household income of individuals who commute by car during the peak hour is nearly $83,000, roughly 20 percent higher than the median household income of those who drive to work during non-peak hours.

As Cortright notes, “these data suggest that peak hour road pricing predominantly affects those with the highest incomes. Those who don’t work, who travel to work by walking, cycling or transit, and those who commute to work in off-peak hours have incomes that are significantly lower than peak hour road users.”

Cortright further argues that shifting costs to peak hour users is fairer and more progressive than today’s road financing system because it places a larger share of the cost on the travelers who tax the road network most heavily. He notes, “accommodating peak hour drivers is the most expensive component of the transportation system: One of the most unfair aspects of our current system of paying for roads is that it charges everyone the same amount, regardless of whether they use the road when it is congested or whether they use it when few people are on the road.”

Rayla Bellis is a Program Manager at SSTI.