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Welcome to Fairfax Underground, a project site designed to improve communication among residents of Fairfax County, VA. Feel free to post anything Northern Virginia residents would find interesting.
Welcome to Fairfax Underground, a project site designed to improve communication among residents of Fairfax County, VA. Feel free to post anything Northern Virginia residents would find interesting.
Editorial: How About A Greenway Sale?
Posted by:
Letter to the Editor
()
Date: May 08, 2013 03:10PM
Editorial: How About A Greenway Sale?
http://m.leesburgtoday.com/mobile/opinion/editorials/editorial-how-about-a-greenway-sale/article_11b76782-a910-11e2-aaed-001a4bcf887a.html
It is too soon to tell if the new round of State Corporation Commission hearings will amount to a hill of beans when it comes time for state leaders in Richmond to consider yet another rate hike for the Dulles Greenway, but a number of interesting ideas are percolating.
Among those is the theory espoused by Del. Randy Minchew that the Greenway owners have reached elasticity demand optimization. This Economics 101 principle identifies the point at which the increasing price of a market good can result in declining revenues.
In simple terms, Del. Minchew questions whether the Greenway has reached the point where increasing tolls hamper the company’s efforts to grow its revenue. He also points to the Greenway owner’s own published data—showing declining use of the toll road and increasing use of more congested alternative routes—to assert the toll rates demonstrably discourage use of the highway, contrary to state law.
The first is a bad business model and the second jeopardizes the Greenway’s authority to operate in the commonwealth.
There is a relatively simple way to test the validity of Del. Minchew’s conclusions, one that most businesses would employ when faced by the same threat of declining revenues: have a sale.
What if the Greenway offered a significant discount on its rates for a month. Would traffic pick up during the promotion? Would the higher traffic counts offset the losses; would they result in increased revenue? It may be difficult to predict the results without trying, but the only thing on which the owners, residents and state leaders agree is that the current structure is not working.
If that type of sale fails to make the case for a better business model, then the sale of the entire operation to the state probably ranks as the top remaining option.
http://m.leesburgtoday.com/mobile/opinion/editorials/editorial-how-about-a-greenway-sale/article_11b76782-a910-11e2-aaed-001a4bcf887a.html
It is too soon to tell if the new round of State Corporation Commission hearings will amount to a hill of beans when it comes time for state leaders in Richmond to consider yet another rate hike for the Dulles Greenway, but a number of interesting ideas are percolating.
Among those is the theory espoused by Del. Randy Minchew that the Greenway owners have reached elasticity demand optimization. This Economics 101 principle identifies the point at which the increasing price of a market good can result in declining revenues.
In simple terms, Del. Minchew questions whether the Greenway has reached the point where increasing tolls hamper the company’s efforts to grow its revenue. He also points to the Greenway owner’s own published data—showing declining use of the toll road and increasing use of more congested alternative routes—to assert the toll rates demonstrably discourage use of the highway, contrary to state law.
The first is a bad business model and the second jeopardizes the Greenway’s authority to operate in the commonwealth.
There is a relatively simple way to test the validity of Del. Minchew’s conclusions, one that most businesses would employ when faced by the same threat of declining revenues: have a sale.
What if the Greenway offered a significant discount on its rates for a month. Would traffic pick up during the promotion? Would the higher traffic counts offset the losses; would they result in increased revenue? It may be difficult to predict the results without trying, but the only thing on which the owners, residents and state leaders agree is that the current structure is not working.
If that type of sale fails to make the case for a better business model, then the sale of the entire operation to the state probably ranks as the top remaining option.
Re: Editorial: How About A Greenway Sale?
Posted by:
boo
()
Date: May 08, 2013 07:08PM
The good conservatives out in Loudoun would be horrified if the Greenway were sold to the State. The State is the "government" and they believe that government can't do ANYTHING right. "Private enterprise" is always better.
So, I say let them continue to be buttfucked by their beloved "private enterprise" every day.
LIVE by your conservatives beliefs, Loudounites!
So, I say let them continue to be buttfucked by their beloved "private enterprise" every day.
LIVE by your conservatives beliefs, Loudounites!