Shannon Wulf Tregar at RFF:
Several states along the East Coast are proposing pilot programs to help pay for increasing transportation costs. Specifically, they suggest charging drivers fees per miles traveled, instead of imposing a gasoline tax (as is often done at state and federal levels). Although one poll suggested that such a fee would be "unwaveringly unpopular," it also found that the public was more supportive if the fee varied based on the vehicle's emissions.
RFF’s Margaret Walls, in a previous blog post, suggests that the fee should vary based on congestion. She writes: "On congested highways in urban areas during peak commuting periods, the fee might be substantial but on rural roads and in urban areas during off-peak travel periods, the fee should be zero." She notes that such a fee would help to address the externalities associated with congestion, such as delay costs, extra fuel consumption, pollution, and road impacts.
While there are a number of complications and research opportunities that make bureaucrats and economists giddy, I don't think there should be a mileage fee at all. Here is an excerpt from the article at the WaPo with some comments:
A group of East Coast states wants to help overhaul the way America pays for its decaying roads, and it’s starting with Monopoly money.
Delaware, Pennsylvania, Connecticut and New Hampshire are proposing pilots to figure out how they might charge motorists a fee for the miles they travel — rather than taxing their gas, as state and federal officials do today.
The I-95 Corridor Coalition, which represents transportation officials from 16 states and the District of Columbia, applied for a federal grant last month to test the idea.
Officials would stitch together the policies and technologies needed to count the miles driven by 50 recruits from each of the four states, including state legislators, transportation officials or other willing guinea pigs. They would send out “faux invoices” monthly. And they would collect the data that legislatures — and the driving public — would require to decide if the change makes sense.
My review of that grant proposal would include a ding for the small, unrepresentative sample.
Although California plans to launch a pilot in July, also with fake invoices, and Oregon has had success with a volunteer program collecting actual cash, the concept is not particularly well known — or well loved across the country.
But Jennifer Cohan, Delaware’s secretary of transportation and chair of the coalition, said states have no choice but to seek alternatives.
“Reliance on the gas tax as a major contributor to funding transportation is no longer a viable option,” Cohan said.
The federal gas tax of 18.4 cents per gallon has not been raised since 1993, and many states have not indexed their own gas taxes to inflation, so those key funding sources have fallen far behind the nation’s needs.
And efforts to raise gas taxes can hit a political wall, as one did in Delaware last year. “In general, it just leaves a bad taste in their mouth when you mention the words ‘gas tax,’ ” Cohan said.
The bad taste is worse than the one left in your mouth when you hit a pothole or breath in too much particulates that then get lodged in your lungs.
According to the latest Mineta survey report, authored by Asha Weinstein Agrawal and Hilary Nixon, which was presented this month at the Commonwealth Club of California, between 31 percent and 75 percent of people supported increasing the gas tax — the higher figure if it was dedicated to maintenance.
Isn't gas tax revenue already dedicated to maintenance? If three-fourths of folks support increasing it I don't understand where the bad taste is coming from.
Delaware ended up raising DMV fees instead. But advocates said that there needs to be a more comprehensive approach to plugging the gaping hole in the nation’s transportation funding, which is why the group of states is delving into the intricacies of “mileage-based user fees.”
“It’s kind of hard to wrap your head around it,” Cohan said, adding that she hopes to tap would-be opponents as some of the test subjects if they are awarded the grant.
“Whatever it ends up being, at least we’ll have data. We’ll actually have something to show: This is what it will look like if we actually implement it,” she said.
Yes, data are cool.
Privacy remains a key issue, including how the government can track miles traveled without raising fears of snooping on where people are going.
Backers say that they are sensitive to such concerns, particularly after Edward Snowden’s revelations about data collection by the National Security Agency left many spooked about government overreach. At the same time, people readily allow their movements to be charted and their personal details to be broadcast via smartphone apps.
Louis Neudorff, an engineer at the firm CH2M Hill, helped manage Oregon’s effort and would play a key role if the I-95 group secures federal funding. He said there are a range of technological tools that allow miles to be tallied without intrusion. Drivers can plug a counting device into a port already found on many cars, he said. Cellphone apps are another option, including one that calls for the driver to take periodic photos of the odometer. One firm promises to pull mileage data from cars through a device hooked to gas pumps at local service stations, Neudorff said.
Cheaters seeking to game the system are a challenge as well.
Of course, some people have no objections to one of the most straightforward solutions: using GPS to measure distances. Such a method would also help solve one of the big questions the East Coast pilot projects would seek to answer: how to divvy up all the miles (and money) based on which state the car is in.
Actually, the most straightforward solution is to raise the gas tax.
“You can drive three or four hours in our part of the world and go through three or four states,” said Neudorff, who lives on Virginia’s Eastern Shore. Loads of toll data from E-ZPass transponders that are already in many cars could help, he said.
“You cannot mandate GPS or, politically, this will never go anywhere. You have to have choices,” Neudorff said.
Patricia G. Hendren, executive director of the I-95 coalition, said that people could opt out. Any future approach “will offer the option to simply pay an annual fee,” she said. But setting that fee could be sticky.
Backers said such questions, and even basics such as how much to charge per mile, are part of what needs to be hashed out in the experiments. Oregon, for example, has been charging 1.5 cents per mile in its volunteer program, which was designed to raise the same amount as gas-tax revenue.
This is very complicated. I wonder if there is a simpler approach?
The intent is that the mileage-based fee “is not additive, but a substitute for the gas tax,” Hendren said. The fake monthly bills would include “estimated gas-tax credits,” she said.
“The idea is to get folks comfortable that mileage-based user fees are a feasible, reasonable and easy-to-use approach,” Hendren said. Vermont is among the five states that signed on for the planning portion of the project, but it is not undertaking a pilot “due to financial constraints,” she said.
Advocates said fairness is a selling point, arguing that people should pay for how much of the roads they use, just as they pay for water or electricity. Under the current system, electric cars avoid the gas tax altogether, though they have big environmental pluses.
I bet that gas tax advocates could use fairness as a selling point, arguing that people should pay for how much of the roads they use, just as they pay for water or electricity.
Here's how Tim put it (Tax Miles? I still think I have a better idea...):
As I have written a number of times, a more straightforward proposal is to simply raise the gas tax. Reaising the gas tax accomplishes a number of things 1) It raises revenue, 2) It discourages miles driven, and 3) It increases the incentive for higher fuel efficiency.
Because my previous posts on this have been written with an ironic twist (I propose a mileage tax that is inversely proportional to fuel efficiency and then show that such a tax is the equivalent of a $1/gallon gas tax), here's the direct, non-ironic version: A $1/gallon gas tax...
...places a higher burden on those driving less fuel efficient vehicles--that should satisfy those blaming the SUV drivers for all of the problems*.
...places a higher burden on those driving more. By increasing the marginal cost per mile driven, total miles driven should decrease.
...assuming fuel efficiency and income are negatively correlated--that is, the rich tend to drive larger, more expensive, less fuel efficient cars--[higher gas taxes] place a higher burden on higher incomes.
...provides an incentive for drivers to switch to more fuel efficient vehicles.
It's really simple. Why worry about complicated milage programs? The gas tax infrastructure is in place. Raise the gas tax and meet multiple public policy and economic goals simultaneously.
And finally, please give electric cars a break. Electric cars have their own costs borne by the driver/owner. It seems especially silly to focus on that small segment of the market.
