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MIIA is a Membership Service of the Massachusetts

Municipalities should begin planning for driverless cars

Published in News on by Joseph Callahan, MIIA’s Marketing Manager

New technologies have a way of forcing governments to change and adapt, and they can bring both upsides and downsides with them. Drones and hover boards, Facebook and Craigslist, are changing the way community members interact with one another – and, in some cases, creating public safety concerns.

Emerging technologies like police-worn body cameras, sewer cameras on cable reels, and gas meters for firefighters and trench workers have altered the way municipalities operate on a daily basis.

Driverless cars, with potential implications ranging from traffic and roadway adjustments to planning and budgeting, are another innovation that’s poised to raise new issues that will need to be addressed at the local level.

Despite how futuristic they sound, cars that can drive themselves are closer to market than one might think. Google has worked on an automated model for years and has already logged more than 1.7 million miles during testing phases. Last December, Tesla’s Elon Musk said his company’s fully automated vehicle would be ready in as little as two years. Nissan, Honda and Toyota have confirmed that they are working on driverless vehicles, and Apple and Uber are rumored to have top-secret driverless car projects in the works as well. Federal vehicle safety regulators, meanwhile, have said Google’s self-piloting system could be considered the car’s “driver.”

Here in Massachusetts, the community of Devens is working on licensing agreements to provide space for manufacturers to begin testing automated systems sometime this year. A former military base that has been redeveloped for both commercial and community use, Devens still has former base housing areas that could be optimal for research and development.

“We have neighborhoods where houses are gone but the roads are still there, so this provides a great environment for industry testing in a more isolated area, but with real roads and intersections,” said Thatcher Kezer, Senior Vice President for Devens operations. “We also hope to provide space for building out prototypes, manufacturing, and research and development.”

Charlie Kingdollar, a property and casualty emerging issues specialist with the reinsurer Gen Re, spoke on the topic of driverless vehicles during MIIA’s Annual Meeting in January, noting that, “Even if the manufacturers are off by 50 percent, we could still see driverless cars within six to eight years, which is much earlier than we were expecting in the insurance industry.”


Municipal implications

According to the University of Michigan’s Transportation Research Institute, the emergence of self-driving cars could reduce car ownership by up to 43 percent, or from 2.1 to 1.2 vehicles per household. Given the success of ride-sharing companies like Uber, it’s feasible that we could see a shift to more family and community-shared vehicles, according to a recent Brookings Institution report, rather than a car for nearly every driver. Most vehicles today sit unused an average of 95 percent of the time, but a self-piloting car could stay busy all day long – dropping us off where we need to be and picking us up when we are ready.

On the upside, Kingdollar noted, we could see far fewer traffic accidents, because statistically most accidents occur when drivers make errors – particularly drivers who are impaired, tired or distracted. Auto insurance payments may be reduced, which could have a positive financial effect for municipalities with large fleets of vehicles, and some manufacturers have already said they will assume all liability.

“Traffic jams could be eliminated, because if your car knows one is ahead, it will avoid it,” Kingdollar said. “Fewer cars on the road means less congestion.”

Fewer cars also likely means less air pollution, he said, especially since most of the new models are expected to be electric.

With fewer cars and more sharing, traffic patterns and road planning could be affected. For example, will special driverless car lanes need to be constructed? Will there be less need for parking spaces on our streets, and fewer or less expansive parking lots and structures? Governing magazine predicts that municipalities may see pressure to standardize road signs, traffic signals, and roadways themselves to ensure the new cars are operating consistently and safely.

From a revenue and budgeting standpoint, the impact is not yet clear – perhaps a greater concern for larger cities and towns that rely more heavily on income from parking and moving violations, towing and vehicle excise fees. With fewer cars, these funds could significantly decrease. With the need for taxis greatly reduced, Kingdollar pointed out, revenues from licensing in big cities like Boston could go down.

As the Brookings report predicts, employment (and associated tax revenues) could also be impacted by a drastic reduction in taxi and truck driving jobs. Governing magazine points out that municipalities could face a range of potential regulatory challenges related to inter-vehicle communication, mass transit, and ride-share services, as well as ethical considerations such as controlling access to personal location and tracking information.


What should municipalities do now?

Even though manufacturers are still in the development stages, Kingdollar said, it’s not too early to examine the potential effects of driverless cars.

“I urge you to consider all the ways municipalities might be impacted and factor those into planning,” he said.

MIIA Executive Vice President Stan Corcoran suggested identifying different scenarios, then analyzing repercussions for each. For example, consider what a 30 percent adoption rate of the new technology would mean versus what a 60 percent rate would mean, and appraise what adjustments would need to be made and how revenues would be affected.

“Although we aren’t sure yet what the specific implications will be, we do know that there is a lot of research and development activity,” he said. “This is a technology that is going to come a lot quicker than we think, and we have an opportunity to prepare for it.”

A state-level working group is currently being developed to explore regulatory issues related to driverless vehicles, Kezer said. When in place, this group could serve as a resource for municipal governments.

“At Devens we want to provide a warm climate for industry development so that we can learn the needs of these automated systems, then be able to share with municipalities so they can identify what changes need to be made at a local level,” Kezer said.


Joseph Callahan is MIIA’s Marketing Manager.

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