U.S. Northeast Site Selector

Big Apple looks at off-peak deliveries to ease urban gridlock. Plus, a look at the most logistics-friendly cities in the Northeast

Ask a motor carrier that delivers to New York City what a one-mile-perhour increase in average vehicle speed could mean and you're likely to induce a low level of euphoria. That will be followed by depression as the realization dawns that this may be only a dream.

Carriers fight the battle for productivity on two fronts in major metropolitan areas. One is getting into and out of the central business district; the other is operating efficiently once they are in the zone.

If you're a shipper trying to get your product into or out of a major metropolitan area or a receiver depending on timely deliveries, you are a stakeholder in one of the biggest battles in transportation — the battle of urban gridlock.

While commuters stuck in traffic jams will point to trucks and blame them for the slowdown, the vast majority of vehicles moving to and from central business districts during peak morning commute times are passenger vehicles. Only 7% of the 200,000 vehicles entering the Manhattan central business district during peak morning hours are trucks, according to the Regional Plan Association (RPA). The RPA studied traffic patterns in New York City with a specific goal of examining the merits of congestion pricing (also known as "value pricing" or " variable tolling").

Congestion pricing gets mixed reviews. "The primary purpose of congestion pricing is to relieve congestion, not raise revenue," according to a recent RPA report. However, the report acknowledges significant investment requirements to implement any of the four scenarios it studied. Admittedly, much of the funding for those front-end investments would have to come from or be repaid by the tolls collected, so one urging of the report is that toll revenues should be reserved exclusively for those purposes.

A second approach to reducing congestion and improving logistics productivity is off-peak deliveries. Rensselaer Polytechnic Institute looked at some of the benefits and difficulties implementing an approach where consignees take deliveries outside the normal business day, defined as 6 a.m. to 7 p.m.

The Rensselaer study summarizes the challenge: The New York metropolitan region is home to close to 20 million residents, more than 600,000 businesses, over 1.3 million registered trucks, and more than 8.8 million employees. The area includes 11,000 miles of highways, three airports and dozens of container terminals and intermodal yards. All of this is in an area that boasts 10% of all national vehicle miles traveled on expressways.

Focus groups consulted in the Rensselaer study claim that in addition to all of the problems of urban deliveries — theft and vandalism, physical constraints, inequitable law enforcement on parking/ standing, and high facility costs — shipments to New York City can be subject to a $150 surcharge on average. Citing figures from 1998, the study notes FedEx's costs were 30% higher to deliver in New York than in other comparable locations.

One way to avoid or reduce some of these problems and costs is for businesses in the area to take deliveries in off-peak hours, says Josè Holguin-Veras, a professor with Rensselaer's Department of Civil and Environmental Engineering. Veras set out to discover what were some of the real and perceived impediments to accomplishing this. He quickly learned that shippers tend to be neutral on the subject.

"They're usually not affected by offpeak deliveries one way or the other," says Holguin-Veras, so it is difficult to get buy in from shippers. Carriers and third-party logistics providers (3PLs) are enthusiastic about productivity gains, but point out that they need critical mass for the concept to succeed. That means consignees need to be onboard — and not just a few of them.

"It's clear that doing off-peak deliveries-will necessitate changes in the logistics chains," Holguin-Veras continues. There can be added costs and risks for consignees, so Holguin-Veras and his team concluded that there must be incentives for this critical group in order to get things rolling.

The concept of off-peak deliveries isn't new, dating back at least to the days of Julius Caesar, Holguin-Veras notes, when horse carts and handcarts were only allowed to operate during evening hours. Then as now, that edict generated community complaints, mostly about noise. Any modern-day effort to shift delivery times will require an accompanying benefit analysis and education effort for the political entities and the community.

Carriers and 3PLs need economies of scale — commitments from a sufficient number of consignees and shippers — to make off-peak deliveries work. Their increased productivity will be reflected in reduced times between deliveries and, therefore, lower costs and reduced emissions.

But one area where carriers suffer is the lack of parking spaces. Deliveries aren't exempt from parking laws, and violations can add as much as $2,000 per truck per month, says Holguin-Veras.

Parking fines are violations of the law and are not deductible business expenses. They also represent a substantial revenue source for a city, so eliminating a substantial portion of the violations has a benefit and a cost. Holguin-Veras suggests an off-peak delivery permit that would allow a truck driver to doublepark during a delivery as long as the truck does not fully block the street. Even at the same rate as the parking violations — $24,000 per truck per year — the carrier is ahead because the permit is a legitimate business expense.

Not all of the costs are on the side of the carrier, but the perception might be that the benefits tilt that way.

"The majority of the problems with off-peak deliveries impact receivers [consignees]," says the Rensselaer study. They require additional staff or alteration of current employee work hours — extension of shifts — to handle off-peak deliveries. This can present problems with labor, especially in a unionized environment, and can require additional supervisory personnel. Other factors include operational costs to keep a facility open longer (heating, lighting, etc.).

Also, security and insurance costs can be higher for the off-hour operation. Alternatives such as drop boxes or unattended-delivery can require modification of the facility and additional security.

The study also identifies warehouses as important stakeholders. Nearly 50% of the daily truck trips in the metropolitan region are warehouse trips, according to the researchers.

Focus groups for the off-peak delivery study also addressed the other alternative for reducing congestion — variable tolls. "Participants expressed skepticism about the likelihood of success of policies aimed at moving traffic to the off-peak periods by toll differentials or other policies," the study observes.

The groups believe that truckers drive during the peak hours because that's when they have to drive to meet consignees' delivery requirements. They think consignees would only change their delivery practices if major incentives are provided.

While further studies grapple with the issues and recommendations to enable increased off-peak deliveries, proponents of congestion pricing are working to prove the benefits of charging more for access to the central business district during peak hours.

Congestion pricing may not have the history of off-peak deliveries, but in the 1970s Singapore introduced tolls on all entries to the core area and saw traffic volumes drop by 40% and delays by 70%. Much of this was commuter traffic that shifted to mass transit, but reduced delays would improve the lot of commercial vehicles entering the central business district to make deliveries and pick-ups.

More recently, in the U.K., the city of London introduced a congestion charge. Early reports indicate traffic volumes dropped by 16% and that vehicles driving to and from the zone are saving an average of 10 minutes per trip.

The London pricing scheme operates on weekdays from 7 a.m. to 6:30 p.m. and charges roughly $8 for entry during that period. Vehicles are photographed at all 174 entry points using 688 cameras with automatic license plate recognition technology. The plate number is matched to pre-paid fees. (The U.K has a single national license plate, unlike the U.S. with 51 state and district plates.)

One of the lessons of the London experience is the need to set policies and establish pricing (as well as make mass transit improvements) before introducing the charge. Certain vehicles which enter and leave the congestion zone frequently during the day are charged only once per day under the London scheme.

Meanwhile, back in New York, the Regional Plan Association studied four scenarios for congestion pricing.

  1. Adding a toll to the East River bridges, which see 4,830 inbound trucks during the morning peak, would not reduce the number of inbound trucks, according to the RPA study.
  2. Introducing variable, time-of-day pricing on the East River bridges and at tolled tunnels managed by the Metropolitan Transportation Authority would reduce the inbound peak truck traffic by 466 vehicles, or 3%, the study estimates.
  3. A pricing scheme like that in London that charges a congestion fee during the 13 daytime hours on weekdays would cut peak truck traffic in the morning by 7%, or 1,023 trucks.
  4. Full variable pricing on all entries set by time of day would also reduce truck traffic by 7%, or an estimated 1,052 trucks.

When looking at total inbound traffic of all types, the first scenario would reduce total daily volume by 5% and also reduce the morning peak by 5%. Variable pricing would reduce overall volume by 5%, but the morning peak would lose 8% of its volume. A London-style toll would cut 9% from total daily volume and 13% during the morning peak. The greatest impact comes from full variable pricing, which eliminates 13% of total volume, or 17% during the morning peak.

Given the kinds of numbers the study projects — up to 105,341 vehicles removed from inbound volumes during the day — the benefit to shippers and consignees will be more efficient transportation. Traffic engineers use a rule of thumb that delays drop by double the percentage that traffic volume drops. If a tolling scheme could reduce peak hour volumes by 17%, as estimated in the RPA study, this could equate to a 35% improvement in transit times.

Congestion pricing appears to be a partial answer for shippers, consignees, motor carriers and 3PLs. Even the London model encourages off-peak deliveries by setting the congestion charge to the peak business hours.

Congestion pricing and off-peak deliveries are politically and emotionally charged issues. Municipal planners in New York and other major metropolitan areas will have to mount significant education efforts to bring the community and the logistics stakeholders together on a solution. That solution may be congestion pricing or off-peak deliveries or, if the planners can get their arms around both solutions, a combination of the two. Either solution can show results much faster than building new infrastructure.

London saw its 16% drop in traffic volume in just a few months. Some industry sources point out that building a bridge can take 10 years.

Reducing peak truck traffic in NYC using congestion pricing
Toll on East River bridges and MTA tunnels
Variable pricing on East River bridges and MTA tunnels
Congestion zone pricing
Full variable pricing
Total daily inbound trucks
61,117
61,117
61,117
61,117
Change in trucks during A.M. peak
0
-466
-1,023
-1,052
% reduction in trucks during A.M. peak
0%
3%
7%
7%
Source: An Exploration of Motor Vehicle Congestion Pricing in New York, Regional Plan Association

How to use the U.S. Northeast Site Selector

The Site Selector offers an objective ranking of 331 U.S. cities based on criteria important to logistics professionals.

This customized listing looks at the top 50 cites and metropolitan areas located in the U.S. Northeast, which includes Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Washington, D.C. and West Virginia. The Site Selector is based on material developed by Expansion Management and Logistics Today.

The Site Selector matrix provides an overall ranking of each city within the Northeast region, as well as an indication of the city's national ranking. Other ranking categories include:

Transportation and distribution (T&D) industry is based on businesses and employment base providing transportation, distribution, warehousing and related services.

Work force/labor is geared to existing and available logistics-related workers in the area.

Road infrastructure measures factors like available lane miles per capita, interstate highway access, miles of paved roads, etc.

Road density, congestion and safety ranks the city on traffic volumes and delays as well as accident statistics and other factors affecting the smooth flow of traffic.

Road condition draws on state performance and includes condition of highways and bridges, among other measures.

Interstate highway includes access to interstate highways, spending on highway construction and maintenance, etc.

Taxes and fees provides a measure of logistics-related costs, including highway and fuel taxes, inventory taxes (where present), etc.

Railroad offers a state-based rank of access to Class 1 and other rail services, miles of track, etc.

Waterborne commerce includes ocean port capacity as well as inland waterways.

Air cargo ranks the city on its access to cargo services, including widebody passenger service by combination carriers, international and expedited services.

2004 Regional Rank 2004 National Rank Metropolitan Area T&D Industry Rank Work Force/Labor Rank Road Infrastructure Rank Road Density, Congestion and Safety Rank Road Condition Rank Interstate Highway Rank Taxes & Fees Rank Railroad Rank Waterborne Commerce Rank Air Cargo Rank 2003 National Rank

2002 National Rank

2001 National Rank
1
8

Baltimore, MD

14
59
136
147
207
3
98
96
19
22
55
29
32
2
10
New York, NY
11
197
9
177
225
1
271
53
3
1
28
39
8
3
11
Pittsburgh, PA
28
117
76
76
310
18
297
28
12
10
26
22
41
4
13
Philadelphia, PA
9
145
27
259
303
16
188
38
6
12
20
45
50
5
18
Newark, NJ
10
136
1
177
286
18
19
66
165
19
33
49
22
6
30
Albany-Schenectady-Troy, NY
91
89
9
91
225
18
271
102
45
69
53
63
162
7
41
Buffalo-Niagara Falls, NY
62
174
9
125
225
54
271
73
68
58
75
88
186
8
46
Bergen-Passaic, NJ
48
142
1
177
286
54
19
66
165
89
118
112
110
9
47
Middlesex-Somerset-Hunterdon, NJ
30
112
1
177
286
100
19
66
165
82
152
137
135
10
49
Nassau-Suffolk, NY
26
97
9
177
225
161
271
53
59
71
182
242
242
11
52

Rochester, NY

87
73
9
114
225
32
271
74
165
65
101
159
233
12
57
Jersey City, NJ
33
79
1
166
286
100
19
66
165
144
113
113
113
13
58
Boston, MA
28
276
55
244
325
32
231
120
34
7
66
91
60
14
61
Washington, DC
29
254
148
277
174
4
103
111
165
4
90
111
91
15
63
Syracuse, NY
68
14
9
37
225
32
271
185
165
67
98
82
158
16
65
Wilmington-Newark, DE
103
158
149
281
134
54
91
62
37
144
203
263
248
17
67

Scranton-Wilkes-Barre-Hazleton, PA

63
31
76
20
310
54
297
36
165
127
80
80
126
18
76
Hartford, CT
84
119
89
118
297
32
205
212
165
46
136
164
171
19
82
Harrisburg-Lebanon-Carlisle, PA
70
185
76
81
310
32
297
49
165
85
62
84
144
20
86
New Haven-Meriden, CT
115
301
89
87
297
54
205
110
41
96
139
161
201
21
94
Portsmouth-Rochester, NH
198
11
173
68
250
161
110
127
51
100
145
146
147
22
105
Monmouth-Ocean, NJ
98
74
1
177
286
273
19
66
165
114
234
215
196
23
106
Providence-Warwick, RI-Fall River, MA
60
4
140
110
324
54
284
252
39
161
102
133
94
24
109
Huntington-Ashland, WV
153
42
239
24
187
161
160
169
7
195
196
187
93
25
117
Trenton, NJ
223
221
1
146
286
54
19
234
76
123
141
142
90
26
119

Charleston, WV

148
152
227
111
214
54
271
82
165
121
264
264
284
27
123
Worcester, MA
121
19
54
70
323
32
239
164
165
237
183
228
187
28
124
Portland, ME
167
252
278
121
257
54
286
168
26
64
130
208
220
29
125

Allentown-Bethlehem-Easton, PA

112
257
76
98
310
161
297
31
165
94
154
165
217
30
131
Springfield, MA
123
172
21
140
326
32
242
92
165
237
175
211
179
31
138

Newburgh, NY

152
215
28
96
260
100
286
124
165
137
172
218
262
32
159
Binghamton, NY
231
131
9
35
225
100
271
185
165
188
162
250
290
33
165
York, PA
135
222
76
147
310
161
297
87
165
144
163
220
251
34
170
Burlington, VT
226
193
257
109
294
100
193
128
165
88
201
235
198
35
177
Erie, PA
186
214
76
278
310
100
297
49
71
260
157
255
274
36
190
Hagerstown, MD
225
294
136
58
207
100
98
137
165
270
229
266
259
37
192

Vineland-Millville-Bridgeton, NJ

174
63
1
16
286
273
19
193
165
299
221
157
159
38
210
Johnstown, PA
168
147
76
51
310
273
297
87
165
201
282
253
289
39
210

Manchester, NH

258
186
138
73
248
100
84
295
165
152
137
185
163
40
212
Lowell, MA
181
150
96
251
295
161
157
121
165
237
285
307
301
41
218
Bridgeport, CT
188
190
89
160
297
161
205
242
49
237
267
248
285
42
219
Lancaster, PA
117
200
76
195
310
273
297
49
165
205
228
303
298
43
225
Stamford-Norwalk, CT
192
282
89
160
297
161
205
242
75
177
296
281
312
44
228
Brockton, MA
149
18
21
244
326
273
242
116
165
237
309
317
302
45
233
Utica-Rome, NY
248
269
9
30
225
100
271
228
165
237
278
265
299
46
237
New Bedford, MA
296
113
21
65
326
161
242
240
77
228
305
312
278
47
241
Lawrence, MA
235
195
96
326
295
100
157
121
165
237
245
276
264
48
247
Bangor, ME
200
319
278
62
257
100
286
250
74
183
246
283
261
49
250
Atlantic City-Cape May, NJ
238
290
1
152
286
273
19
234
165
129
210
262
210
50
257
Reading, PA
145
187
76
164
310
161
297
182
165
269
254
294
308
Source: Based on material developed by Expansion Management and Logistics Today

resources

Metropolitan Transportation Authority www.mta.nyc.ny.us

Regional Plan Association
www.rpa.org

Rensselaer Polytechnic Institute
www.rpi.edu

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