A new report from the Vancouver Mayors’ Council on Regional Transportation says pricing is the best way to tackle congestion.

Transportation mega-projects – ranging from expansive highways to new transit lines – won’t be enough to ease congestion in crowded cities. Instead, policymakers and elected officials will need to resort to the only proven method of solving congestion: pricing.

That’s the message from a new report by the Vancouver Mayors’ Council on Regional Transportation. Inside, the mayors lay out their vision for what types of transportation investment is needed over the next ten years in order to keep pace with population and employment growth in the Vancouver region.

The mayors warn that proposed investments – which will total $7.5 billion over the next decade – will fail to fully clear up the region’s crowded roads and highways without tolls and other congestion charges that send a vital pricing signal to drivers.

“The Mayors…recognize that we cannot solve congestion by investment alone: we need new tools to manage the system more effectively,” the report says. “To tackle congestion and to make sure that the significant new road capacity we have added in this region doesn’t soon get swallowed up in traffic jams, there is only one tool that has a proven track record. It’s the tool that we use to allocate scarce resources everywhere else in the economy: pricing.”

The mayors’ report calls the dynamic pricing of roads and transit – where the price of driving or using a bus or subway changes with demand – the best way to increase the efficiency and “fairness” of transit.

“By pricing roads and transit so that users pay less to travel on less busy routes and during less busy times of day, drivers and transit riders who have more flexibility can change when or where they decide to travel and free up valuable space for those who have no option but to travel at that time or on that route,” the report says.

Part of the plan would also ensure that road tolls and congestion charges would allow policymakers to eliminate or reduce the current (and regressive) fuel sales tax by $0.06 per litre. Revenue from the tolls and other congestion charges would be reinvested back into the transit system, the report adds.

The most important takeaway from the report is that we can’t build our way out of congestion. Creating more roads will simply encourage people to drive more, while overbuilding the transit system in an attempt to entice drivers out of their cars has been shown – repeatedly in cities across North America – to come up short.

The use of pricing to reign in congestion, on the other hand, improves the efficiency of current infrastructure and encourages the economic expansion of the transit system.

Brady Yauch is an economist and Executive Director of the Consumer Policy Institute (CPI). You can reach Brady by email at: bradyyauch (at) consumerpolicyinstitute.org