‘North America’s Biggest P3’ Tackles Congestion in Maryland

Just days before President Donald Trump signalled he might rely more heavily on state and local governments to deliver on his $1-trillion infrastructure plan, Maryland Governor Larry Hogan was out with an ambitious, $9-billion Traffic Relief Plan that relies on tolls to expand the state’s three busiest highways.

When he made the announcement, Hogan called the plan “the largest proposed P3 highway project in North America.”

The initiative will involve widening Highways I-270, I-495, and MD-295, CityLab reported, with two new express lanes in each direction on all three roads. “Private companies would build and maintain the new toll lanes, sending a portion of their revenue to the state every year.”

With a mind-boggling 620,00 drivers using the three roads on the average week days, “these three massive, unprecedented projects…will be absolutely transformative, and they will help Maryland citizens go about their daily lives in a more efficient and safer manner,” Hogan said at the official unveiling for the project.

“Not only do P3s dramatically decrease the cost to taxpayers, they also have the potential to generate billions of dollars in much-needed revenue for the state,” he added. “It won’t cost us tax dollars.”

Making Best Use of a Road

The CityLab story pointed to both the opportunity and the tension baked into the project.

“On paper, this looks like a textbook example of the sort of voter-friendly infrastructure project that the Trump Administration has been promoting: privately funded and auto-centric,” noted Washington, DC-based freelance writer Andrew Zaleski. “But in a state once considered a leader on sprawl-containing ‘Smart Growth’ policies, this is also a kind of pave-a-thon from another era.”

But Loyola University Maryland economics professor Stephen Walters pointed to the ability of managed lanes to strike the balance between highway widening and a concern about induced demand.

“If new lanes are ‘free’, everyone crowds in, so you pay for using the road in time and gas wasted rather than money,” he told Zaleski. “But there’s lots of evidence that the price system—tolls—works very well to reallocate demand over time, coaxing those who value the road least at peak times not to use it then, while making high-valuing users pay for the privilege.”

A Vote of Confidence for State Leadership

The Maryland announcement earned a qualified but important vote of confidence for the kind of infrastructure leadership the country will need if the federal government relies more heavily on state and local governments to deliver on its broader infrastructure plan.

With the Capitol Region on track to grow from 5.4 to 6.9 million people over the next 25 years, “public officials don’t have the luxury to engage in theological debate about the comparative benefits of transit vs. roads vs. new technology,” opined the Washington Post Editorial Board. “If the region is to remain liveable, prosperous, and mobile, it will need more of all of the above.”

The Post editorial covered many of the familiar objections to managed lanes, even referring to them by their long-discredited nickname as “Lexus Lanes”. But the paper still gave the Maryland governor credit for making congestion and infrastructure a priority.

“Without being shoved to the top of the regional agenda—which Mr. Hogan has achieved by sheer audacity—the region’s transportation system will remain stuck in its current state of alarming inadequacy,” the editors stated. “The name of the game is capacity, and without much more of it, including road capacity, Maryland will be a worse place to live, and its ability to compete economically will be diminished.”