KOTI - Korea Transport institute

As the Korea Government has established the national political agenda ‘the enhancement of publicness of national highway network, the much expensive tolls in private highway, which is a toll road managed by private sectors, is identified as one of the main flaws in publicness. The average toll of major 7 private highways is 1.60 times higher than those of national roads in 2018. It is clear that the roadmap for toll management is needed to achieve real progress. Thus, this report was initiated to establish national strategies in order to enhance the publicness of a private highway by reducing tolls.

While many experts have emphasized the publicness of roads, the researches on specific factors of road publicness have not been carried out. This report defined the definition and specific requisite of publicness of private roads. Then national policies and strategies were reviewed based on the definition of publicness of private roads. Throughout this process, the paper reveals the linkage between publicness of roads and tolls. Even the publicness should be considered in various ways, higher tolls are the main obstacle of enhancing road publicness especially in Korea road networks because there is no significant improvement in service quality in private roads. In order to fair services in both private and national roads, the policymakers should manage the level of tolls on private roads base on the service quality of roads.

The main issue in management policies for private highways is the private roads on the operation. Dislike to national highways, the private highways have a variety of aspects such as tolls, traffic, and operating expenses. This attributes to each characteristic of the private companies that run those roads. The guarantee of enforcement agreement including the dividend rate sometimes overrides the publicness of roads. Eventually, the specific strategies considering details of each private road section must be lunched to manage tolls in private roads in order to enhance the publicness of private highways.

This report developed specific strategies for reducing and controlling tolls in each private road sector. Strategies are developed based on the case study. The report classified toll-cut methods based on the case studies and identifies the necessary conditions and requirements for applying the methods. New toll-cut methods also were developed by expert advice. As a result, the reports suggested 6 types of methods for lowering tolls.

Specific strategies for the road section were deduced by financial analysis based on cash flow following 5 steps. First, the report prioritized the private road sectors based on the level of tolls. In the second step, multiple possible methods were adopted before the financial feasibility. Each private road section has multiple alternatives in this step. In the third step, financial feasibility decides the realistic possibility of alternatives. An alternative that shows the highest feasibility was adopted for roadmap as ideal strategies. Then, a specific process was arranged to push forward a plan.

As a result, the roadmap includes not only strategies but also time tables to implement strategies. The time table suggested a sequential process. This is because resources, such as manpower and budget, were limited. The roadmap shows that the road section has high toll rates should be pushed ahead with priority. In addition, this report also suggests the policies for complementing roadmap such as the utilization of specialized Institutions or amendment to related legislation. The government is able to establish a comprehensive toll management system in Korea by referring to the various alternatives and strategies.