What Happened?
Oregon lawmakers recently passed SB 810 to create a mileage-based user fee program to charge drivers per mile for highway use rather than per gallon. The program is the first in the nation and mimics the utility billing for highway charging, allowing users to pay for what is utilized.
The Goal
Oregon’s Road Usage Charge Pilot Program will charge vehicles traveling faster than 55 mph to pay a per mile fee rather than the state’s gas tax. The pilot program recently concluded, involving 40 volunteers to test the new charging system. The study is part of an 11-year transition to determine how best to address gaps in funding as a result of more fuel efficient gars and alternative sources of energy. With more drivers operating hybrids or leveraging natural gas, the state’s gas tax no longer generates the same funding.
Pilot Breakdown
The fee amount in the pilot program was 1.56 cents per mile. Pilot participants could choose from five different plans to report and pay for miles driven. The volunteers could pick a method to report their miles driven or opt for a flat rate, either to be paid with a check or debit/credit card. For drivers who wanted to track mileage before paying, in-vehicle devices were installed to accurately gauge distances.
The Oregon Department of Transportation’s report on the pilot program analyzed the efficiency of the tested system, as well as the five ways mileage was collected and reported on:
- Flat rate plan administered by the Oregon Department of Transportation (ODOT) would charge a driver a flat fee each month for unlimited mileage throughout the state, no technological requirements
- Basic plan administered by the ODOT which places a wireless reporting device into a vehicle to transmit data to a government account
- Basic plan administered by a private provider would involve a vehicle tracking device but be under the guidelines of a third part
- Advanced plan administered by a private provider would include a wireless reporting device that also tracks vehicle location to avoid charging for out-of-state travel
- Smartphone plan administered by a private provider includes wireless reporting and vehicle location tracking, while using a smartphone to transfer data to the third party account
Rural vs Urban
To determine the effects of such a program throughout the state, Oregon officials drafted a report analyzing a mileage-based user fee program on urban and rural communities. The report found residents in both urban and rural settings are comfortable with the technology required to implement the fee program, with neither community disadvantaged. Urban and rural residents tend to travel comparable distances over the course of a year, while rural drivers drive on state public roads less than urban drivers.
Furthermore, urban drivers tend to operate fuel-efficient vehicles, but rural drivers experience more fuel efficient driving conditions. A road usage charge may prove to be beneficial to rural drivers as they tend to drive fewer miles than urban drivers and can subtract off-road miles when reporting driving totals.
Transportation Improvements
Gov1 has monitored similar projects such as new highway construction and other transit initiatives that take advantage of various sources of funding.