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This paper analyzes the second-best pricing and investment policy for transport networks with a revenue-recycling mechanism in which the toll revenue is used as transport investments or subsidies, as in London's congestion charging scheme. The results of this paper demonstrate that the way toll revenue is used significantly modifies the usual results, where a lump-sum transfer is assumed. First, revenue-recycling as investment has an effect that works to increase the second-best toll when the benefits from it are larger than the costs. Revenue-recycling as a subsidy does not have such an effect. Second, 'partial' cost-benefit analysis that focuses only on the targeted transport mode would usually lead to a false conclusion as to whether the toll revenues should be used as transport investments, subsidies, or general tax revenues. The 'full' costbenefit analysis, which includes changes in consumer surplus and producer surplus in all transport modes, is necessary. JEL classification: R41; R42; R48; L91