AET Feasibility Analysis and Comparative Assessment of ORT Follow-up Analysis at the Dover & Rochester Toll Plazas Comparing the Financial Feasibility of Open Road Tolling vs. All Electronic Tolling Presented to Bureau of Turnpikes Prepared by 28 July 2017 Table of Contents Executive Summary ........................................................................................................................................................... 5 Section 1.0 Introduction............................................................................................................................................. 9 1.1 Background ....................................................................................................................................................... 9 1.2 Purpose .............................................................................................................................................................. 9 1.3 Overview of Report......................................................................................................................................10 Section 2.0 Overview of Existing AET Facilities .................................................................................................11 2.1 Locations .........................................................................................................................................................11 2.2 Fare Structures...............................................................................................................................................12 2.3 Impact of AET on Transponder Market Share .......................................................................................14 Section 3.0 Existing Conditions Overview...........................................................................................................17 3.1 Traffic Trends .................................................................................................................................................17 3.2 Toll Rate Structure .......................................................................................................................................18 3.3 Revenue Summary .........................................................................................................................................19 3.4 Transaction Flowchart & Violations Recovery .......................................................................................20 3.5 E-ZPass Market Share Growth ..................................................................................................................23 3.6 Fare Collection Costs...................................................................................................................................24 Section 4.0 Key Assumptions and Analytical Framework ................................................................................27 4.1 ORT Assumptions .........................................................................................................................................27 4.1.1 Traffic Composition .................................................................................................................................27 4.1.2 ORT Capital Costs ...................................................................................................................................28 4.1.3 Fare Collection Costs ..............................................................................................................................29 4.2 AET Assumptions ..........................................................................................................................................30 4.2.1 Traffic Composition and Revenue Leakage ........................................................................................31 4.2.2 Fare Collection Costs ..............................................................................................................................33 4.2.3 Fare Structure............................................................................................................................................33 4.2.4 AET Capital Costs ....................................................................................................................................34 4.3 Evaluation Framework..................................................................................................................................35 4.4 Scenarios for Evaluation...............................................................................................................................36 4.5 Comparison of Scenarios 1 (Existing Processes) with Scenarios 2 through 4 (Revised Pricing Framework) ..................................................................................................................................................................38 4.6 AET Conditions of Analysis ........................................................................................................................39 2 | Page July 28, 2017 4.7 Simulation of Results.....................................................................................................................................40 4.8 Analysis Approach Summary ......................................................................................................................42 Section 5.0 Analysis Results.....................................................................................................................................43 5.1 Scenario 1 – Existing Business Rules.........................................................................................................43 5.2 Scenario 2 – Base Case ................................................................................................................................44 5.3 Scenario 3 – Cover Cost of Account Handling......................................................................................45 5.4 Scenario 4 – Add Surcharge........................................................................................................................46 5.5 Net Revenue Analysis for Scenarios 1 thru 4.........................................................................................47 Section 6.0 Findings and Recommendations........................................................................................................50 6.1 Findings.............................................................................................................................................................50 6.2 Conclusions and Recommendations .........................................................................................................53 Section 7.0 Pilot Program ........................................................................................................................................57 Appendix A Hooksett Ramp Analysis ....................................................................................................................59 A.1 Existing Conditions Review.........................................................................................................................59 A.2 AET Assumptions ..........................................................................................................................................62 A.3 AET Net Revenue Analysis .........................................................................................................................63 A.4 Conclusions.....................................................................................................................................................65 Appendix B Corridor-wide vs. Systemwide Deployment .................................................................................66 List of Figures Figure ES-1 – Forecasted Transaction Leakage, ORT vs. AET ............................................................................... 5 Figure ES-2 – Projected Cost per Non-ETC Transaction at Dover & Rochester, 2020.................................. 6 Figure 2-1 – AET Location Overview .........................................................................................................................12 Figure 2-2 – ETC Market Share on E-470, 2009 thru 2016...................................................................................15 Figure 2-3 – Transponder Market Share for Various NTTA Facilities, 2009 thru 2016 ................................16 Figure 3-1 – FY16 Traffic Volumes at each New Hampshire Toll Plaza.............................................................17 Figure 3-2 – Total Transactions at Dover & Rochester (rolling 12-month basis, June 2011 thru February 2017) ...................................................................................................................................................................................18 Figure 3-3 – Gross Revenue Breakout from Dover & Rochester (in thousands of dollars) .........................20 Figure 3-4 – New Hampshire Turnpike System Transaction Flowchart – 2016 ..............................................21 Figure 3-5 – E-ZPass Market Share Growth at Dover & Rochester, June 2011 through February 2017 ..23 Figure 3-6 – Annual Cash Transactions at Dover & Rochester, June 2011 thru February 2017 .................24 Figure 3-7 – Fare Collection Cost Summary at Dover & Rochester (in thousands of dollars)....................25 Figure 3-8 – Unit Costs for Fare Collection in