Search results for: “road pricing”

• Toronto’s bike lane pendulum

  This week, the Province of Ontario started work on its plan to remove about 19 kilometres of bike lanes in Toronto on major streets such as Bloor Street, Yonge Street, and others. The plan is to restore motor vehicle lanes, push bike lanes to secondary streets, and “keep drivers moving.” However, work did not start without protest. Hundreds of cyclists have been protesting this week, and a handful of arrests have been made.

  The thing about bike lanes in Toronto, and other places, is that they tend to follow a political pendulum. We have a history of building bike lanes, and then paying lots of money to rip them out. It’s of course wasteful, but bike lanes are divisive and they can make for good politics. Recent polls suggest that the majority of Torontonians support removing them on major streets. And I can understand why. We’re all frustrated with traffic congestion!

  But here’s what I would say in response to what’s happening this week:

  • The city should be making the decision, not the province.
  • A street like Bloor serves as an important east-west artery in our cycling network. Toronto’s grid does not have a secondary street equivalent.
  • Toronto needs more major streets like Bloor. It needs a bold 21st-century masterplan.
  • It is true that some sections, such as in Etobicoke, do have lower cycling ridership, but every lane needs to be evaluated in terms of the broader network.
  • Built form dictates behaviour.
  • Successful cities must be multi-modal.

  Traffic congestion is no doubt a major problem in Toronto, but we’re nipping around the edges and unwilling to make big, bold changes. The keys to solving traffic congestion are appropriate land-use policies, road pricing, and investment in non-car forms of urban mobility. Pretending otherwise is just fooling ourselves. To solve congestion, Toronto needs to reduce automobile dependency.

  2026.10.15

• Why uploading Toronto’s highways to the province won’t fix traffic congestion

  In 2023, the City of Toronto announced a deal that would “upload” the Gardiner Expressway and Don Valley Parkway from the city to the province. This was a big deal because these highways were previously the city’s largest state-of-good-repair liabilities, and so, before this deal, the city was, you know, trying to figure out how to pay for them.

  One option was road pricing (or expressway tolls). And in 2016, this became a real possibility with City Council overwhelmingly endorsing the plan, before it got rejected by the province. It will come as no surprise to regular readers that I was in support of it and writing about it at the time.

  

  In 2016, Toronto estimated that 40% of all trips on these two expressways were by non-residents, and yet they were being funded by Toronto taxpayers. When I said this on Twitter, many of you got upset and argued that people coming in from the suburbs are a boon for the city. No doubt. But the reality is that this was an inequitable funding structure.

  Let’s look at the 2022 Transportation Tomorrow Survey results, which I wrote about here.

  The mode share for all trips to downtown Toronto (from within the city) was 75% non-car, with transit making up the largest share at 40.4%. And the mode share for home-based work trips to downtown Toronto (people who leave home in Toronto to go to work downtown and then come home) was about 80% non-car! In this case, transit made up nearly 50% of the trips.

  The effective result is that the people who tended to drive the least to work were paying for the highways with their tax dollars, and the people driving into downtown were not. This is in no way intended to be an attack on the latter camp. The simple reality is that driving into downtown and buying a chicken souvlaki pita from Jimmy the Greek at lunch isn’t enough to offset the road usage costs.

  The uploading of the highways to the province (which is still advancing but has already relieved Toronto of its financial obligations) is a more equitable solution. It shifts the cost burden to Ontario taxpayers, reflecting that people from all over the region use these highways and that Toronto is part of a broader economic agglomeration.

  But this only solved the jurisdictional problem. We still have worsening congestion and an inefficient funding model. The problem with using broad-based taxation to obfuscate infrastructure costs is that direct usage then goes unpriced, and that leads to what is known as a “tragedy of the commons.”

  We all tend to act in our own short-term self-interest, and the result is that road demand constantly outstrips the available supply. There’s zero marginal cost to actual usage, whether you drive 100 kilometres each day or bike to work. The most effective way to manage traffic congestion is to remove the hidden subsidy for driving and price the costs and negative externalities.

  2026.08.21

• Finally, New York City gets its congestion relief zone

  January 6, 2025 · View original

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  Good morning. Well, it finally happened.

  After decades of delay and negotiations, New York City finally implemented congestion pricing for the area of Manhattan south of 60th Street. This is a first for the United States, and so it’s a big deal not just for the city, but for this part of the world. It went into effect yesterday, on Sunday at midnight, so that the MTA could work out any kinks before this morning’s rush hour. And apparently everything went smoothly. Drivers are now required to pay $9 to enter the zone during peak hours (5am to 9pm during weekdays). The charge is also expected to rise to $15 by 2031. Of course, this is a highly contested initiative. Trump is still vowing to kill the program as one of his first acts in office and, as soon as the pricing came into effect, suburban drivers started protesting it in Manhattan. I thought Jarrett Walker had a clever response to this:

  > Tweet: Tip: An effective protest is one that doesn’t prove the other side’s point.

  One of the common rebuttals when it comes to things like road and congestion pricing is this one: “yeah, this might work in cities like London which have great transit systems, but it doesn’t work in our city because we don’t have that and it will unfairly disadvantage those who have no other alternative but to drive.” In fact, this exact excuse was recently raised by local politicians here in Toronto. But this is New York fucking City. It has the highest annual transit ridership in North America (beating out Mexico City by nearly 2x) and it has the largest system by total length. According to the 2012-2016 American Community Survey, 85% of people traveling to Manhattan’s CBD (I’m assuming lower Manhattan here) also take transit. And only 11% drive a car. So what exactly is the problem here?

  This objection also ignores the fact that, generally speaking, congestion pricing has two main goals: (1) to, of course, reduce traffic congestion and (2) to generate money for more efficient modes of transport. In this case, the MTA is hoping this new congestion relief zone will generate up to $15 billion that can then be reinvested in transit and other infrastructure. Demand for roads can also be relatively inelastic in the short term, meaning demand doesn’t change all that much as the price moves up and down. This makes it a good place to find money for public infrastructure, but it might mean that $9 is too low to have a dramatic impact on traffic congestion. We will see; I’m sure we’ll get some data soon enough.

  My prediction is that this will ultimately have an impact on congestion and that people in New York will get over the $9 charge. They’ll also come to appreciate the reduced traffic congestion within the zone. So I think this road pricing will stick, and my hope is that it will become an example for other cities in the US and across North America. Congratulations on finally getting this over the line, NYC. It was certainly a hard-fought battle.

  Cover photo by Veronika Galkina on Unsplash

  2025.01.06

• Why do we choose traffic?

  Scott Stinson gets a lot right in this recent Toronto Star article about road pricing:

  There is a simple tool to combat traffic congestion that has been proven to be effective. There are real-world examples of where it has been deployed to great and long-lasting success. It’s called road pricing. And we seem to be deathly afraid of it.

  This is even if the benefits are real and measurable:

  Jonas Eliasson, director of travel accessibility at the Swedish Transport Administration, has first-hand experience with the effects of the congestion charge implemented in Stockholm in 2006. Public polling showed two-thirds of voters were against the road-pricing plan before it was introduced in a pilot program. A local politician called it the “most expensive way ever devised to commit political suicide.” But after it began, Stockholm traffic levels dropped by 25 per cent, more than double initial estimates. In a subsequent referendum, Stockholm residents voted to adopt the congestion charge permanently.

  There are lots of reasons why road pricing is commonly opposed, but at the end of the day, it works, and we know all too well — especially here in Toronto — that the status quo sucks:

  “Over the years, transportation economists and planners have pointed out that there really is no other solution to traffic congestion than more efficient pricing,” he said in an interview. “So every time somebody said ‘No, I don’t want road pricing or congestion pricing,’ they’re actually saying, ‘I want traffic congestion.’”

  I’ve been writing about this topic for almost as long as I’ve been writing this blog. So at this point, I think we just need to run a pilot. No more studies and reports. No more protracted debates.

  Let’s try it out and see how many people prefer (1) less traffic congestion and (2) more money for alternative modes of transport.

  2024.08.06

• NYC’s congestion relief zone is now on indefinite pause

  Boy, congestion charges are a pain to implement. Back in 2018, I wrote that New York City was considering a congestion charge for drivers entering Manhattan below 60th Street. Then in 2019, about a year later, I followed up with this post saying that the plan could be adopted as early as April of that year!

  That didn’t exactly happen. But I followed up again with a post in 2022 saying that New York City was still considering a congestion charge. And ultimately, it did finally get approved, even if it did take much longer than expected. It was rebranded a congestion relief zone (“relief” sounds a lot less offensive than “pricing”), and it was set to come into effect on June 30, 2024.

  This remained the situation until the first week of this month, which is when NY Governor Kathy Hochul held a surprise press conference and announced that the congestion relief zone would be placed on “indefinite pause.” I think that means cancelled. And it happened less than a month before the state was finally set to start collecting money.

  There is a legal question around whether she actually had the authority to intervene in this way, but let’s put that aside for now. Irrespective of that, this is a disappointing outcome precisely because we know that road pricing works. If you have a traffic congestion problem, price it, and then you will have less of it.

  What’s even more disappointing about this particular instance, though, is that many of us were looking to New York City to show us the way. We were looking for the most walkable and transit-rich city in the US to show people that, hey, road pricing works, and it won’t decimate your CBD.

  It is shocking to me that traffic congestion is allowed persist in the way that it does in our cities, and that there remains zero political will to actually address it. Instead of action, we like to preoccupy ourselves with red herrings. If only we didn’t have streetcars, Ubers, and so many bike lanes, then there wouldn’t be congestion.

  So what hope do we have now that even New York won’t do what is bold and right? Lots, as always. Cities, now is your chance to do what New York was too scared to do. Who will lead?

  2024.06.19

• The price of car ownership certificates in Singapore just hit a record high

  If you were a city-state only slightly larger in area than the City of Toronto, you would think about space very differently. There would be no option to just sprawl further out. And that is the case for Singapore, which is approximately 734 km2 compared to Toronto’s 630 km2.

  So it’s no wonder that Singapore carefully manages how people use and own cars. Not only were they the first country in the world to implement a congestion charge (road pricing), but they also force people to buy 10-year “Certificates of Entitlement” in order to own one.

  These are auctioned off every 2 weeks and the overall supply of them is controlled by the government.

  Currently, the starting price for a COE is S$104,000 (roughly the same in Canadian dollars). This is a record high and up nearly 3x compared to 2020 when fewer people wanted to own a car. However, if you’d like a COE that works on all sizes of cars, that is right now S$152,000.

  It’s hard to imagine a system like this ever flying in a large country like Canada. But if Canada were the size of just Toronto, you can be sure that we would likely have no other choice. That said, this is more or less how we treat new housing: we’ve made it difficult and expensive for new entrants.

  2023.10.09

• Don’t screw it up, New York

  New York City is set to become the first in the US to implement a congestion charge (a form of road pricing). I first wrote about this back in 2018, and then again in 2019, but now it is looking more and more like it may actually happen sometime next year.

  I think all urbanists agree that this is an important step in the right direction. But some are now worried that New York isn’t going about it in the right way. Here is an excerpt from a recent Vice article by Aaron Gordon:

  With all these plans, you could be excused for thinking New York is doing congestion pricing—a potentially transformative policy that would be a first in the nation—right by not only charging drivers to access some of the densest, most valuable land in the world, but also giving them alternatives. Unfortunately, New York isn’t doing that, and in fact looks set to completely screw up congestion pricing so badly it may discredit the policy in a way that makes it harder for other cities to adopt it. Rather than approaching it as a lynchpin to a wide-ranging effort to reshape Manhattan’s relationship to the private car, congestion pricing has become solely about money—specifically, paying off enough of the credit-card bill New York has run up with a variety of ill-conceived and poorly-executed projects that it can get more credit cards.

  You can rightly say that this is decades in the making. Mayor Bloomberg first proposed the idea back in 2007, and I’m sure there were others before him with a similar idea.

  So Gordon raises a valid point: It’s important that NYC gets this right. Otherwise, it’s going to be that much more difficult for other North American cities to even think about implementing road pricing.

  For the full Vice article, click here.

  2023.09.19

• Venice announces new “entrance fee”

  

  Over the weekend, we spoke about using road pricing as a way to correct supply and demand imbalances on city roads and highways. Because it turns out that when roads, or anything else for that matter, are free, people tend to use them a lot more. It’s why when you suddenly submeter utilities in an apartment building, consumption tends to drop off significantly. Now it’s no longer “free”.

  It’s for this exact reason that Venice — a city that has been complaining about too many tourists for many years — has decided to implement a new entrance fee. Starting spring 2024, day trippers will have to pay €5 to enter the “old city” of Venice.

  If you own a home there, you’re exempt because presumably you’re already paying property taxes. And if you’re staying overnight, you’re also exempt, because presumably you’re going to be paying whatever hotel taxes the city levies. But if you’re just coming in for the day, you’re going to need to pay.

  Now, I don’t know if €5, structured in this way, is going to fully address the city’s overtourism concerns. Maybe it needs to be a lot more. But it is a step in the right direction. If you have too much demand for a certain amount of supply, you can generally lower demand by increasing the price. Perhaps the only exception is a Birkin bag. Apparently you can charge any price for these.

  Photo by Martin Katler on Unsplash

  2023.09.13

• Toronto needs money

  For next year’s budget (2024), the City of Toronto is projecting a $1.5 – $1.7 billion budget shortfall. And over the next 10 years, this shortfall is expected to grow to nearly $47 billion if changes aren’t made. This is according to a recent report prepared by Ernst & Young and Strategy Corp. So right now, all of this is being looked at and debated by Council.

  Where are we going to get this money?

  One persistent debate is whether the city actually has a revenue problem, or whether it’s simply an expense/spending problem. I can’t say that I’ve scrutinized the city’s expenses at any length, so I’m not going to get into that level of detail today. For this post, I’d like to focus on two specific things. The first is property taxes.

  Here is a figure, from the report, showing residential property tax rates across southern Ontario:

  

  What you will see is that Toronto has the lowest rate of the 35 municipalities that they looked at. Now obviously there are some nuances to consider. The average home price in Toronto is higher than it is in, say, Sault St. Marie. Toronto also has a large commercial property tax base. But even still, historically speaking, Toronto has tended to increase its residential property taxes at or below the rate of inflation.

  This is a problem. And it is the exact same problem that we have talked about on this blog in regards to residential rent controls. If you own an apartment building where the rents are capped and your expenses are, therefore, growing faster than your revenue, you are (1) highly incentivized not to invest in the apartment (you can’t afford to) and (2) eventually going to hit a financial wall.

  Sound familiar? As far as I can tell, that is, at least partially, what is happening here.

  Secondly, one of the first things that I did when I opened the report was run a search for “road tolls” and “congestion charges”. Regular readers of this blog will know that this is something I feel strongly about. Here’s what I found:

  In 2017, when the City considered implementation of tolls for the Gardiner and the DVP, staff estimated that a $2-per-trip toll would generate $5.6 billion in 10 years. The province has refused several requests to consider these options, with the Minister of Transportation rejecting any discussion of uploading or tolling as recently as December 2022.

  This is also a problem. One of the general rules with taxes is that you should ideally tax the things you want less of. Hmm. So why not tax traffic congestion? There is no question that it works. There’s lots of evidence from all around the world. We just lack the political will to actually do it. Instead, we pay lip service with solutions that don’t work.

  At the same time, if we were to actually implement road pricing, I don’t believe that a flat toll is the way to go. $2 also seems low. The best practice is dynamic road pricing that fluctuates based on actual congestion levels. Meaning, if you’re driving at 5am, expect a low rate. And if you’re driving at 5pm, expect a high rate.

  Virtually overnight, we know this would do at least three things: (1) it would reduce/eliminate traffic congestion (congestion levels would become a function of pricing); (2) it would reduce overall carbon emissions in the city; and (3) it would take a meaningful chunk out of this $47 billion budget shortfall.

  2023.09.10

• Manhattan is still looking at a congestion charge for south of 60th Street

  We talk a lot about congestion charges and road pricing on this blog. Here’s a list of some of those posts. I found 46 that were tagged with “road pricing.”

  I continue to believe that it’s the only way that big cities can effectively solve the problem of traffic congestion. It’s not being caused by the bicycle lanes that were just added to your street. It’s not the new COVID street patios. And it’s not the new apartment that was just built with too many parking spots.

  The problem is mispricing.

  If you want free roads, then you don’t get free-flowing traffic. That’s how this equation works, which is why I have always thought it a good idea to dynamically price roads based on demand, and then to direct those funds toward more efficient forms of mobility — such as transit.

  Despite all this, it’s not a very popular approach in this part of the world. Toronto looked at road pricing back in 2016, but we got nervous and backed away from it. New York City has also been looking at a congestion charge for Manhattan south of 60th Street for at least 4-5 years. But this one appears to still be on the table.

  According to this recent CityLab article, New York’s congestion prices could look something like this (note that this chart includes other pre-existing tolls):

  

  But with some exceptions (I think this is an interesting approach):

  Primary residents of the Manhattan central business district, which is south of 60th Street, and New York State residents with adjusted gross income of less than $60,000 would be eligible for a state tax credit equal to the amount of the new tolls, paid during the taxable year.

  In total, this current pricing scheme is expected to generate an additional $1 billion in annual revenue for the city’s transportation authority. The MTA also plans to bond against this revenue and raise an additional $15 billion for new transit projects.

  This sounds like a reasonable approach to me.

  2022.08.11