Northern Virginia Vanpool AdVantage Program Product Development Research Study

1. Northern Virginia Vanpool AdVantage ProgramProduct Development Research Study June 22, 2004 Southeastern Institute of Research Pulsar Advertising Team

2. Background & Methodology • A quantitative online research study among those identified by MWCOG, RADCO, VPSI, and PRTC as Vanpool Owners/Operators • Interviewing conducted April 22 – June 8, 2004 • This report based on 111 completed interviews • Maximum statistical error is +/- 8.0%

3. Objective • The overall study objective: • Determine existing vanpool operators’/drivers’ willingness to participate in the AdVantage Vanpool Program given the requirements associated with participation and the financial incentives offered. • Specific objectives include: • Gauge awareness and understanding of AdVantage Vanpool Program • Identify various costs of managing existing vanpools • Assess and rate paperwork/reports associated with AdVantage Vanpool Program requirements • Identifying the defining characteristics of best prospects for AdVantage Vanpool Program

4. Typical Vanpool Characteristics

5. Who Drives the Vanpool: Respondent: 75% Designated Driver: 41% Some Other Person: 22% Who Owns the Van: Respondent or Family Member: 56% Leasing Agency: 28% Private Party: 9% Employer: 1% Other: 6% Average Age of the Van: 4 Years Average Round Trip Distance: 92 Miles Average Van Seating Capacity: 13 (including driver) Type of Insurance: Commercial-type: 63% Family: 20% Uncertain: 17% Van Depreciation: 44% take depreciation Profile Of Respondents & Their Vanpool

6. Vanpool Accidents: 17% have been involved in an accident in the past 5 years Most Travel I-95: I-95: 81% I-66: 13% Dulles Toll Road: 3% Other: 4% Average number currently riding in vanpool: 11 (including driver) Average Monthly Fare: $120 (per passenger) Average Number Receiving Metrocheck vouchers or other employer provided subsidies: 9 passengers Additional Characteristics

7. Per Month Lease/cost payment: $ 771 Fuel: $ 268 Maintenance: $ 169 Insurance: $ 164 Personal Property Tax: $ 119 Parking: $ 72 Parking Subsidy: $ 44 Cleaning: $ 21 License Plates: $ 14 Other Expenses: $ 48 Per Year Lease/cost payment: $ 8,056 Fuel: $ 2758 Maintenance: $ 1447 Insurance: $ 1915 Personal Property Tax: $224 Parking: $ 640 Parking Subsidy: $ 434 Cleaning: $ 217 License Plates: $ 48 Other Expenses: $ 543 Average Vanpool Operating Costs

8. Vanpool Owners’/Operators’ Overall Interest In Participating In The Vanpool Incentive Program

9. 65% Would Be Interested In The Program If It Were Available Today42% Would Be Very Interested Q. 15: Remembering back to the estimated subsidy, and now that you have a better understanding of the program and its requirements and associated forms, how interested would you be in participating in this Vanpool Incentive Program if it were available to you today?

10. VPSI Drivers May Be Slightly More Interested In the Program Q. 15: Remembering back to the estimated subsidy, and now that you have a better understanding of the program and its requirements and associated forms, how interested would you be in participating in this Vanpool Incentive Program if it were available to you today?

11. Realistic Level of Demand: 1 Out of 4Applying A Discount Model To Level of Interests Suggests That The Potential Market For The Vanpool Incentive Program Could Be As High As 25% Of Those Not Part Of The VPSI Program Demand Discount Model A more realistic potential for market demand can be obtained by applying a standard demand forecasting discount model where market potential equals 50% of those who say they are “Very interested” plus 25% of those who say “somewhat interested” in the product concept. Q. 15: Remembering back to the estimated subsidy, and now that you have a better understanding of the program and its requirements and associated forms, how interested would you be in participating in this Vanpool Incentive Program if it were available to you today?

12. Key Finding #1: There Is Great Interest In This Vanpool Incentive Program Strategic Implication Proceed With Program Launch – This program Will Work!

13. The Impact Of The Monthly Subsidy Benefit

14. The Longer The Round Trip Distance The Greater The Interest In The ProgramRespondents Knew The Greater The Distance Traveled, The Greater The Subsidy Q. 15: Remembering back to the estimated subsidy, and now that you have a better understanding of the program and its requirements and associated forms, how interested would you be in participating in this Vanpool Incentive Program if it were available to you today?

15. Overall, The More Subsidy A Vanpool Qualifies For, The More Interested They Are In The ProgramChart reflects ratings of ‘4’ or ‘5’ only Q. 15: Remembering back to the estimated subsidy, and now that you have a better understanding of the program and its requirements and associated forms, how interested would you be in participating in this Vanpool Incentive Program if it were available to you today?

16. The Following Two Slides Report On Two Questions About Insurance Subsidies As An Alternative To Monthly Subsidies.These Two Questions Were Added At The Last Minute During The Completion Of The Fieldwork. Due To This Timing, Only 17 Respondents Answered These Questions As Part Of The Complete Survey. An Additional 52 Respondents Complied With A Follow-up Email Requesting Their Feedback To The Questions.

17. Interest In Insurance Subsidies Versus Monthly Monetary Subsidies Is Split* Q 15a: Contingent on your vanpool having adequate commercial-type insurance, with a minimum liability coverage no less than $2,000,000, how interested would you be in participating in this Vanpool Incentive Program if, rather than receiving a monthly subsidy payment, we were to reduce your insurance burden by sharing up to half of your van’s insurance costs with you? * Data represents only 69 respondents or 62% of the total sample

18. VPSI Members Appear To Be Less Interested In Insurance Assistance*These numbers, however, are not statistically significant due to the small sample size Q 15a: Contingent on your vanpool having adequate commercial-type insurance, with a minimum liability coverage no less than $2,000,000, how interested would you be in participating in this Vanpool Incentive Program if, rather than receiving a monthly subsidy payment, we were to reduce your insurance burden by sharing up to half of your van’s insurance costs with you? * Data represents only 69 respondents or 62% of the total sample

19. Few Would Choose Reduced Insurance Rates Over A Monthly Subsidy*Though 31% have no preference Q 15b: If you had a choice, which would you prefer to receive, a monthly subsidy (as determined by your van’s size, age, and daily round trip distance) or a reduced rate on your van’s commercial-type insurance? * Data represents only 69 respondents or 62% of the total sample

20. Few Owner/Operators Would Prefer Reduced Insurance Q 15b: If you had a choice, which would you prefer to receive, a monthly subsidy (as determined by your van’s size, age, and daily round trip distance) or a reduced rate on your van’s commercial-type insurance? * Data represents only 69 respondents or 62% of the total sample

21. Key Finding #2: The Greater The Subsidy, The Greater The Interest. Strategic Implication Look for ways to increase program appeal for those slated to receive a smaller subsidy, i.e. vanpools with older vans that travel shorter distances and carry fewer passengers.

22. Vanpool Owners’/Operators’ Willingness To Meet The Requirements Of The Proposed Vanpool AdVantage Program

23. Owners/Operators Are Willing To Embrace The Contract Requirements Of The Vanpool ProgramBut There May Be Some Challenges With Insurance & Contract Requirements Q 13a: How willing are you to: …?

24. Most Vanpools Currently Meet the Program Eligibility Requirements Q 12: Minimum Requirements:  the driver must be at least 21 years of age and have at least 5 years of driving experience;the driver and backup driver shall not have received any more than 2 moving violations and/or one chargeable accident under the vehicle laws of any state or more than one criminal offense arising out of the operation of a motor vehicle within the past three years; the van must have a seating capacity of at least 7 people, including the driver; Vanpool is not for profit. Does your vanpool arrangement meet these eligibility requirements?

25. Those Qualifying For A Smaller Subsidy Are Less Willing To Limit Personal Van Use Or Provide Adequate InsuranceChart reflects ratings of “very” or “somewhat willing” only Q 13a: How willing are you to: …?

26. Key Finding #3: The Vanpool Incentive Program requirements, as designed, are reasonable and most vanpools currently meet those requirements. Strategic Implication The Vanpool Incentive Programcan work as designed.

27. Key Finding #4: Insurance requirements receive the least support. Strategic Implication Further investigation of insurance subsidy appeal, as opposed to a monetary subsidy, may maximize the appeal, and ultimate use, of the program.

28. Opportunity Target: Who Is Most Interested In The Vanpool Incentive Programs

29. Differences Between Groups • Those with newer vans are more willing to carry the required amount of commercial-type insurance • 62% when the van is 4 years old or less vs. 30% when the van is 5 years + • Those whose round trip distance is greater are more willing to sign a legal contract with the program operating agency • 88% when the round trip is 121 miles + vs. 62% with a shorter trip • Those with larger vans are more willing to limit personal van use • 82% when the seating capacity is 10 + vs. 57% with smaller vans

30. Key Finding #5: Program has most appeal for owner/drivers of the larger, newer vans that make the longest daily commutes. Strategic Implication First focus on these respective prospects as the early adopters in order to build initial program sales momentum. Then merchandise success to the remaining prospect base.

31. Vanpool Owners’/Operators’ Views On Program Reporting Requirements

32. Respondents Were Asked To View Program Reports And Rate Their Willingness To Comply With Data Collection. • Four forms were shown to all respondents to rate • Each form was rotated so that no one form was displayed first among respondents • Respondents were not asked to fill out the forms, just review them • Questions about each form appeared roght behind each form

33. Monthly Attendance Form

34. Monthly Expense Form

35. Vehicle Trip Sheet

36. Operator Monthly Fares/Revenue Form

37. Three Quarters Have No Problem Reporting This Kind Of Information To The Federal GovernmentHow willing are you to have this information submitted to the Federal Government? Q. 14: How willing are you to have this information submitted to the Federal Government?

38. The More Frequent The Reporting Requirement, The Less Willing Potential Participants Are To Comply With Requirements Q 14a: With regard to the ______ Reporting Form, how willing are you to comply with the requirements currently under consideration for this report as a condition to participation?

39. Overall, Those Interested In The Program Are MoreWilling To Comply With Reporting RequirementsChart reflects an average of “somewhat” and “very willing” ratings for all form requirements Q 14: How willing are you to comply with the requirements currently under consideration for this report as a condition to participation?

40. Those With Limited Or No Interest In The Program Report “Too Much Paperwork”As The Primary Reason For Lack of Interest (66%)* * Data represents only 29 respondents or 26% of the total sample

41. Key Finding #6: The Vanpool Incentive Program reporting requirements are reasonable, though many have issues with the frequency of collection and submission. This impacts program interest and potential participation. Strategic Implication Give serious consideration to a simplifying the reporting requirements and frequency of reporting.

42. Views On Data Submission

43. Program Interest Would Decrease For Some If A Signature Were Required In Filing The Reports Q 20: What affect, if any, would it have on your desire to participate in the program if a signature were required in filing the reports, making it necessary for you to either mail or submit the data in person?

44. Requiring A Signature Would Have Little Affect On Those Already Interested In The Program Q 20: What affect, if any, would it have on your desire to participate in the program if a signature were required in filing the reports, making it necessary for you to either mail or submit the data in person?

45. Owners/Operators Prefer Electronic Data SubmissionTop Preference = 1, Second Preference = 2, etc. • Email (1.7 average) • On-Line Submission (1.9 average) • Fax (2.7 average) • Mail (3.2 average) • In Person (4.9 average) Q 19d: What is the most convenient way for you to submit the data? Please rank the following filing methods in order of preference; ‘1’ would be your top preference, ‘2’ would be your second preference, and so on.

46. Key Finding #7: Electronic submission is the preferred method of reporting. Strategic Implication Reporting and communication efforts should be handled electronically,eitheronline or by email.

47. Changes Or Improvements To Generate More Interest In Program Participation

48. The Amount Of Paperwork Is the #1 Issue Q. 17: What changes or improvements would need to be made to make you more interested in participating in this Vanpool Incentive Program?

49. Other Program Suggestions/Improvements Other responses: • No adverse tax consequences • Drop the need for commercial insurance. Insurance agencies don’t want to insure vanpools • Advise operators/riders of pending changes in I-95/I-66 routes, i.e. HOT lanes • Have Vanpool Driver of the Year Awards • The state needs to help Vanpools find new riders • Provide a list of financial services who offer low-interest loans for buying replacement vehicles • Provide a list of dealerships who may offer a lease program for vanpool • Signing of a contract is not good

50. Key Finding #8: There is too much paperwork associated with this program. Strategic Implication Look for ways to reduce the paperwork burden.