There are two primary funding sources for highway transportation: taxes and tolls. As a growing and more mobile population increases its demand for surface transportation, fuel tax rates have not been indexed for inflation and funds for tax-backed roadway facilities are being diverted to non-roadway use. According to the final report of the National Surface Transportation Infrastructure Financing Commission: “Because it is not adjusted for inflation, the federal gas tax has experienced a cumulative loss in purchasing power of 33 percent since 1993—the last time the federal gas tax was increased.” Furthermore, as the national focus on reducing energy use and oil dependence intensifies, gas tax collections are being reduced by fuel efficient vehicles.

As the availability of tax revenues to fund new transportation capacity has diminished, many state and regional governments have begun to pursue tolling as an alternative funding source for new roadways. Bonds backed by the anticipated revenue of a new toll facility have been used to fund the construction of hundreds of miles of new capacity in the last decade. This paper summarizes the current state of transportation funding in the US and the experience and lessons learned by various tolling authorities around the country in the pursuit and construction of new toll projects.

National and regional perspectives on tolling options, currently implemented facilities, differences pertaining to levels of studies, and the level of detail required for decision making will be explored. Processes necessary to undertake general toll feasibility including a description of traffic and revenue, project cost evaluation, general financial analysis, and tolling technology, will be highlighted. With the advent of modern technology and new pricing strategies, there are many options available when considering the application of tolls on a new facility. Using a sophisticated pricing structure can improve mobility and thus air quality, safety, etc. in an area by combining travel demand strategies with variable pricing strategies. Pros and cons of alternatives implemented nationwide and their levels of success will be identified. An overview of best practices and legal structures in place across the US will be presented.