Supplemental Brief — McKeown v. Delaware Bridge Authority

; Supreme Court, U.S.

£ FILED

MAY 14 #002

No. 01-1421

“CPMCE OFTHE CLARK

In The

Supreme Court of the United States

KEVIN MCKEOWN

Petitioner,

THE DELAWARE BRIDGE AUTHORITY, et al.,

Respondents.

On Petition for a Writ of Certiorari to the United States

Court of Appeals for the Second Circuit

SUPPLEMENTAL BRIEF

Kevin McKeown

1200 Pennsylvania Ave., N.W.

P.O. Box 7228

Washington, D.C. 20044-7228

(202) 223-8030

Pro Se Petitioner

TABLE OF CITED AUTHORITIES

Cases:

Whitman, EPA, et al. v. American Trucking

Association, 531 U.S. 457, 121 S. Ct. 903

(decided February 27, 2001)

Acts of Congress:

Clean Air Act (“CAA”)

TABLE OF APPENDICES

APPENDIX A:

STUDY: A MODEL OF THE TOTAL COST OF

HIGHWAY TOLL COLLECTION BY PROFESSORS

PETERS AND KRAMER

1

SUPPLEMENTAL BRIEF FOR PETITIONER

The petition demonstrates that lower court findings in

this case create a conflict with Whitman, EPA, et al. v.

American Trucking Association, 531 U.S. 457, 121 S. Ct.

903 (decided February 27, 2001) and with provisions of the

Clean Air Act. Since the filing of this petition, petitioner has

been made aware of an important study (Appendix “A”) by

Professors from The City University of New York and

Kutztown University of Pennsylvania which indicates that

toll booths create significant amounts of pollutants in

violation of The Clean Air Act.

1. Respondents do not dispute their violations of

The Clean Air Act, that a conflict exists that requires this

Court’s full consideration or that this matter greatly affects

the health and welfare of vast amounts of U.S. citizens.

Further, respondents consented to Professors’ Peters and

Kramer request to present this study to this Honorable Court.

In short, the importance of the question presented iS

essentially unchallenged.

2. As this Court observed in Whitman, EPA, et

al. v. American Trucking Association, Congress intended to

protect the public without cost concerns and expressly

provided that the best technology available be utilized.

3. Toll booths violate The Clean Air Act when

they slow and otherwise impede the movement of toxic

substance emitting vehicles and unnecessarily add to

environmental pollutants. As in Whitman, EPA, et_al

which affirmed a Court of Appeals finding that §109(b) of

the Clean Air Act unambiguously bars cost considerations,

the current operation of toll booths must stopped.

4. This case presents important questions which

impact the health, welfare and civil rights of every citizen of

the United States, and is not limited to the states in which toll

booths operate.

CONCLUSION

Accordingly, Petitioner respectfully prays that this

Honorable Court grant the petition for Writ of Certiorari.

Respectfully submitted,

Kevin McKeown -

1200 Pennsylvania Ave., NW

Box 7228

Washington, D.C. 20044-7228

202-223-8030

Pro Se Petitioner

A Model of the Total Cost of Highway Toll

Collection

- by:

Jonathan Peters

Assistant Professor of Finance

The City University of New York

7 The College of Staten Island

3N207

2800 Victory Boulevard

Staten Island, NY 10314

(718) 982 — 2958 (718) 982 - 2965 FAX

jpeters@postbox.csi.cuny.edu

Jonathan K. Kramer

Professor of Finance

Kutztown University of Pennsylvania

125 deFrancesco Building

Kutztown, PA 19530

(610) 683-4704 (610) 683-1514 FAX

jkramer@kutztown.edu

Presented at

Eastern Economics Association Annual Meetings

February 2001

New York, New York

Appendix A-1

Forthcoming in the Proceedings of the 24" Annual

Conference of the Association of Pennsylvania

University Business and Economic Faculties

October 2002.

A Model of the Total Cost of Highway Toll

Collection

Introduction

Air quality and greenhouse gas emissions are

important issues around the world. Most solutions to air

quality issues have some type of negative economic

impact such as monitoring costs and/or constraints on

economic growth. One potential means of emission

control that does not have a negative impact on

economic growth is improved toll collection on toll

bridges and roads. The traditional manual collection

method causes motorists to decelerate from, and

reaccelerate to, highway speeds. This, combined with

the affects of queuing at toll plazas during peak travel

periods, results in significant environmental costs.

However, current models of the cost of toll collection do

not account for these costs and therefore significantly

underestimate the benefits to society of improved toll

collection. We propose extending current models to

account for these environmental costs.

Appendix A-2

Literature Review

Prior research on toll collection has focused on the

compliance and administrative costs of the collection

process. Vickrey (1963) is the first to outline a theory

of the optimal pricing of road networks. Arnott, de

Palma and Lindsey (1997) extend the Vickrey model by

creating a structural model of road congestion that

considers congestion technology and_ behavioral

decisions of drivers in determining optimal toll pricing.

Sheila and Wilson (1991) consider the idea of optimal

tolls and the deadweight loss to society created by

traffic delays resulting from the toll collection process.

Friedman and Waldfogel (1995) and Burris and

Hildebrand (1996) document some of the major issues

related to the administrative and compliance costs of

toll collection. In addition, Friedman and Waldfogel

(1995) measure these costs using a case study of a

Massachusetts Turnpike toll plaza and data from the

New Jersey Turnpike Authority. While all of these

studies address the cost issues that are important to

administrators, they ignore the environmental costs.

In this study, we extend the Friedman and Waldfogel

(1995) model by adding variables that measure the

environmental impact of toll collection. We then use

this model to calculate the total societal cost (TSC) of

Appendix A-3

toll collection on the Garden State Parkway (GSP) in

New Jersey using Sisson’s (1995) estimates for

automobile emissions, and the New Jersey Highway

Authority's traffic volume estimates. Our results clearly

indicate that the environmental cost of toll collection is

significant and should be included in any measure of

total collection cost.

Methodology

The total cost of toll collection is equal to the sum of the

administrative, compliance, and environmental costs.

The Friedman and Waldfogel (1995) model measures

the administrative and compliance costs. According

to their model, administrative costs (AC) incurred

during time t are equal to:

AC; = wrlt + urK (1)

Where wr equais the cost of operating a tollbooth per

time period, L; is the number of tollbooths staffed and

operational during time period t, u; includes the user

cost of toll collection capital (including both borrowing

and depreciation) per time period, and K equals the

value of toll collection capital. Therefore, over any

Appendix A-4

extended period of time (for example, a year)

administrative costs equal:

AC =w,5'T, +KYu, (2)

‘=0 1=0

Compliance costs (CC) are measured as wQ, where w

is the value of the road user's time and Q is the total

amount of time the driver (assuming no passengers) is

delayed in compliance:

Q= (24 + ag (3)

where fd equals the fixed delay, q: equals the number

of vehicles in the queue at time t, L, equals the number

of lanes staffed at time t, a equals the number of

vehicles that can be processed per lane per time

period, or the throughput rate, and a; is the number of

vehicles arriving per time period. Therefore, according

to this model, total collection costs (TC) equal:

TC =AC+CC (4)

However, as Sisson (1995) points out, the process of

toll collection creates a significant amount of additional

pollution as compared to transit at highway speeds.

This is not accounted for in equation 4. To calculate

Appendix A-5

the pollution cost per pollutant x (PC,), we use the

following equation:

PC, = (fp + (vp rx) Px (5)

where fp equals the fixed acceleration pollution of

pollutant x per toll collection, vp equals the queuing

pollution of pollutant x, 1 is the average rate of

production of pollutant x per time period, and p, is the

cost of pollutant x to society on a per unit basis. Total

pollution cost (PC) is equal to:

rt = YPC, (6)

xz]

where m is the total number of pollutants being

measured. We add this variable to the right-hand side

of equation 4, that we call the total societal cost of toll

collection (TSC):

TSC = AC +CC+PC (7)

Case Study: The Garden State Parkway

New Jersey’s Garden State Parkway (GSP) is 173

miles long and has eleven major toll barriers and

twenty ramp toll plazas. Based on data collected from

the New Jersey Highway Authority we calculate the

Appendix A-6

a

total societal cost of toll collection on the GSP for the

year 2000 using the model outlined above. Our goal is

to demonstrate that when pollution costs are ignored,

the total cost of toll collection is _ significantly

understated.

Administrative Costs (AC)

The New Jersey Highway Authority estimates that

administrative costs on the GSP (including the cost of

capital and the labor costs of toll collectors and

administrators) were $0.07 per toll collection in the year

2000. They also report 436,161,722 toll collections at

the major toll barriers for the same year. Therefore, we

estimate administrative costs to be $30,531,321 for the

year 2000.

Compliance Costs (CC)

The Friedman and Waldfoge! (1996) model was

designed for use on a two stop toll road where the

driver stops once to pick up ticket and then again to

pay the toll. While this is consistent with many toll

collection systems such as the NJ Turnpike and the

Massachusetts Turnpike, on the Garden State

Parkway, drivers stop repeatedly for the duration of the

trip with a maximum distance of 24.76 miles and a

minimum of 5.79 miles between major toll barriers. A

driver following the whole route of the GSP would stop

Appendix A-7

at 11 barriers along the route. Therefore, we need to

modify Friedman and Waldfogel’s (1995) compliance

cost function so that it calculates costs on a per stop

basis: CC; = (fd+vd))w (8)

where CC; equals the compliance cost at time t (per

stop), fd equals the fixed delay, vd; is the variable delay

at time period t, and w equals the value of the road

user's time. The Triborough Bridge and Tunnel

Authority estimates that the theoretical maximum for

the number of vehicles a tollbooth can process is 250

per hour. Based on this, we calculate the fixed delay

as 7.2 seconds per car. With 436,161,722 toll stops

occurring in the year 2000, at a delay of 7.2 seconds

per stop, this totals 872,323 hours spent paying tolls.

At an average wage rate of $20 per hour’, this

represents a total compliance cost (CC) of $17,446,469

for the year 2000.

Pollution Costs (PC)

We estimate the pollution costs related to toll collection on the GSP

using Sisson’s (1995) estimates of pollution production from decelerating

an automobile to zero miles per hour and then reaccelerating to the same

speed. Sisson (1995) examined three vehicle classes (pre-1979, 1980-

1988, and 1989-1994) in his study and their corresponding production of —

Nitrous

Appendix A-8

Oxide, Hydrocarbons, and Carbon Monoxide. While

' The estimated wage rate is from the Bureau of Labor Statistic’s 1998

estimate of the average income of New Jersey residents ($39,516).

Dividing this number by a two thousand hour work year results in an

average hourly wage of $19.75.

this was representative of the automobile population in

1995, our estimates of pollution production in 2000 are

taken from the most recent period.” The fleet average

output of pollutants for this cohort, per acceleration, net

of what would be created by a quarter mile transit at 65

m.p.h., are given in row two of Table 1. Based on

these estimates, the cost per kg of pollutant, and the

total number of toll collections on the GSP during the

year 2000, we estimate the total cost of pollution from

toll collection at $12,702,011. With toll collection

revenue on the GSP reported to be $152,656,602 for

the year 2000, pollution costs represent 8.32% of

revenue collected’. ,

Appendix A-9

2 Emission standards for Hydrocarbons, Carbon Monoxide, and Nitrous

Oxide have remained constant for automobiles and light trucks since

1994. The Sisson (1995) data is attached as Appendix 1.

3 Details of our pollution calculations are included in Appendix 2.

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-Appendix A-10-

This estimate is on the conservative side because we

did not estimate the queuing costs for the GSP. Given

that the commuter on the GSP currently has three

payment choices — manual, exact change and low-

speed EZ-Pass, and that traffic volumes vary greatly

over the course of the day, estimating the costs related

to queuing are very complex and beyond the scope of

this study. Nevertheless, including queuing would only

increase pollution costs aS a percent of revenue

collected, further bolstering our argument in favor of

including pollution costs in the total cost equation.

Total Societal Cost (TSC)

From equation 5, total societal cost represents the sum

of administrative, compliance and pollution costs. In

the case of the GSP in the year 2000, we estimate total

societal cost of toll collection to be $54,566,340 or

39.75% of revenue collected (see Table 2), and

pollution costs represent 20.93% of TSC, only slightly

less than compliance costs.

Appendix A-11

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Conclusion

Economists should not ignore pollution costs when

estimating the total cost of toll collection. By examining

the pollution costs on the Garden State Parkway we

have shown that, even without measuring the

environmental impact. of queuing, pollution costs

constitute 20.93% of the total societal cost of toll

‘ collection, or 8.32% of revenue collected.

The model we develop in this paper will assist public

policy makers in making optimal decisions regarding

toll collection procedures. For example, the cost

estimates in this Paper are based on a one hundred

percent manual toll collection process.‘ If high speed,

automated toll collection procedures were

implemented, or if tolls were Partially or completely

eliminated, we would expect pollution costs to decline

Significantly. These types of policy issues can only be

properly analyzed if- all costs/benefits are accounted

for, including those regarding the environment.

Appendix A-13

* The GSP is currently only using a low speed collection method, which

our research indicates results in almost the Same amount of pollution as

manual toll collection. See our kinetic energy calculations attached as

Appendix 3 for further details on the loss of energy caused by the

slowing of vehicles in toll plaza.

Bibliography

Arnott, Richard, Andre de Palma and Robin

Lindsey. “A Structural Model of Peak-Period

Congestion: A Traffic Bottleneck with Elastic Demand.”

American Economic Review 83 No. 1 (March 1993): ©

161-79.

Burris, Mark W. and Hilderbrand, Eric D. "Using

Microsimulation to Quantify the Impact of Electronic

Toll Collection” /TE Journal Vol. 66 (July 1996): 21-24.

Friedman, David and Waldfogel, Joel. “The

Administrative and Compliance Cost of Manual

Highway Toll Collection: Evidence from Massachusetts

and New Jersey.” National Tax Journal Volume 48,

Number 2 (June 1995): 217-228.

New Jersey Highway Authority. "Traffic Counts and

Revenue Collection by Toll Plaza - 2000".

Woodbridge, New Jersey, 2001

Seila, Andrew F. and Paul W. Wilson. “Deadweight

Loss in Highway Toll Collection.” Transportation

Research-B Vol. 25B No. 2/3 (1991): 127-141.

Appendix A-14

Sisson, Mark. “Air Quality benefits of electronic toll

collection.” Transportation Quarterly Volume 49 (Fall

1995): 93-101.

Vickrey, William S. “Pricing in Urban and Suburban

Transport.” American Economic Review Volume 53

No. 2 (May 1963): 452-465.

Appendix A-15

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