Mileage Tax Potholes?


A few weeks ago, ODOT released the final report on their “Road User Fee Pilot Program” (a test of a mileage tax as a replacement for the gax tax). They declared it “feasible.”

But the most recent issue of Willamette Week (“Miles from Nowhere”) predicts that it won’t happen.


44 responses to “Mileage Tax Potholes?”

  1. Count me in a bit with both the enviros and the civil libertarians on this one. It doesn’t make sense to tax based on mileage without taking vehicle weight into account, and there are serious privacy concerns about the handling of the uploaded GPS data (or even what happens to data in the vehicle which is not uploaded — can the vehicle owner delete it once the tax is paid?)

    At the end of the article, WWeek included this little fact:

    Oregon was the first state to implement a gas tax, in 1919. In 2005, the per-gallon tax generated $374 million, or about 30 percent of the state’s road maintenance budget.

    I’d love to see a whole article on just this topic — how much does the state (and counties and municipalities) spend on road maintenance and on new roads, and how much of that money comes from what sources.

    – Bob R.

  2. It is a brilliant solution for a problem that doesn’t really require one. Once you take weight into account, (which is a big deal: 16 one ton cars do as much damage to the street as 1 two ton car,) you’ll end up with a tax that taxes heaver cars more than lighter cars on a per mile basis. Once you add in some credits for PZEV cars and the like and suddenly you’ve basically got what we have today, a tax on a gallon of gasoline. Sure it tends to bill older cars a little bit more than newer ones, and it bills people with AC more than people without, and it bills people that floor it off of stoplights more than people that don’t, (wait, those people are doing a lot of damage to the road like that, so maybe we should bill them more,) but compared to the cost of the piece of equipment that this will add to the car, those differences aren’t that significant…

    If the gasoline tax isn’t generating the revenue it needs to, well, maybe we should raise it. If the political will doesn’t exist with the population to raise the gas tax, and it is so bad that it would be easier to install tracking devices in everyone’s car, then we’ve got a big problem, (and it isn’t limited to just our roads, it is also our schools, and what exactly the long term solution is to crazy people that can’t hold a job and therefore ride MAX all day to stay warm.)

  3. One of the arguments for the mileage tax is that it may be easier to implement a new tax that is NOT constitutionally dedicated to roads than to change the current constitutional limitation on the gas tax.

  4. Matthew? How do we tax cars that don’t burn a fuel? How about radically different propulsion or energy sources?

    It is not about fixing the current problems. It is about planning for life after petroleum. Which will come – sooner or later.

  5. How do we tax cars that don’t burn a fuel?

    Rather than potentially intrusive, privacy-violating taxing systems like GPS, we could switch to or augment the current system with a weight-mile tax. Most modern vehicles have robust internal odometers in their computers which are very difficult to taper with. A simple annual check-up (could be done at the same stations and dates as DEQ) from the onboard computer’s odometer would do.

    (If your computer is malfunctioning or damaged, or you believe the odometer reading to be incorrect, you could get an “appraisal” by a certified mechanic approximating how many miles your car has driven compared to similar models with known mileage.)

    A bit if a pain, but still way less intrusive than GPS monitoring.

    For ballpark comparison purposes, a 25MPG average-weight car, driven 15K miles per year, today’s equivalent of 23.9cents per gallon would total up to $143/year.

    Also, for vehicles that run purely on gasoline or another pump-delivered energy source, they could stick with the gas tax, and for electric cars and plug-in hybrids, the weight-mile system could be implemented. (Homebrew bio-Diesel and (in the future) hydrogen operations could be taxed in a similar manner to how we do it today.)

    Beyond all that, I do see good use for GPS, but on a volunteer basis: Recruit (and pay a modest stipend, if necessary) a cross-section of drivers from around the state, representing the population of drivers as a whole, within an acceptable margin of error. These people will carry GPS loggers in their vehicles, and the data will be aggregated (and anonymized) by state university researchers, so that we can get an idea of real travel patterns, origin/destination pairs, (vehicle occupancy too, if we can get it), time-of-day, etc.

    This will allow us to assess the areas with the most latent demand, areas where a true “bypass” would be the most useful, etc., when deciding where to spend our transportation dollars.

    – Bob R.

  6. Chris, what is stop the road interests from insisting than a new tax also be for roads only?
    I’m a skeptic on this…roads don’t seem to be in that bad a shape. Maybe ODOT will learn to do more with less, and really just do maintenance. I suspect that considerable resources still go to capacity projects in the guise of “safety” or whatever issue is in fashion.
    The focus needs to be on reducing or shifting demand to other modes that do less harm to the environment. More and better roads just makes things worse.

  7. “and for electric cars and plug-in hybrids, the weight-mile system could be implemented.”

    How about an electric meter? You’d have a meter (similar to the one on the side of your house,) on the plug for the car, and once a year or whenever, you’d need to pay a couple cents per kwh read on that meter…

  8. “I’m against all tax increases, PERIOD.”

    Yes, as I said, we have bigger problems, that aren’t just limited to maintaining our roads…

    And: Would charging money to ride previously free transit in downtown Portland count as a fee increase? (I’d say yes.)

  9. “Would charging money to ride previously free transit in downtown Portland count as a fee increase? (I’d say yes.)”

    Technically yes, but since everyone else is subject to this “fee” (although you do get a ride for it at that exact time) then the fee should be assessed fairly.

  10. I’m against all tax increases, PERIOD.

    Al, for the record, this is not an increase, it is an alternative to the existing state gas tax. Under the present design, you would pay either the gas tax or the mileage tax (but not both, thus it is not technically an “increase”) depending on whether or not your vehicle has the appropriate hardware installed and functioning. I support this initiative, but I would be even more supportive if the intent were to charge more/less per-mile depending on the weight of the vehicle.

  11. This smacks to me of a solution looking for a problem — but it’s got a lot of problems of its own:

    – As designed, data collection points are at service stations. However, many biodiesel vehicles, not to mention plug-in electric hybrids, don’t use the existing service system network.
    – It penalizes rural residents as much or more than folks who spend a lot of time idling in traffic in urban commutes..
    – There is no incentive to buy a fuel-efficient vehicle. Even if it was adjusted for the weight of the vehicle, weight is not everything (OK, it might account for damage to roads, but what about broader policy goals?)
    – The technology comes with a pricetag. At what point do you stop paying just for the cost to collect the tax, and actually start making a profit on the system?

    I agree with everybody who says we should just raise the gas tax.

    Or, alternatively, assess a statewide carbon tax, to be collected at the fuel pump, and indexed to inflation. Say, twenty-five cents a gallon, and it could be used for anything marginally related to transportation.

  12. Any such system of taxation must include GPS tracking devices on bicycles too; thereby requiring bicyclists to open up their wallets and themselves be financially responsible for the specialized and exclusive infrastructure they use backing up all the babble with bucks.

  13. “Any such system of taxation must include GPS tracking devices on bicycles too;”

    Don’t forget those subsidy loving pedestrians, wearing out the street with their weird shoes and demanding 12 foot sidewalks. Really, if they’d just lose a little weight they wouldn’t need the sidewalks to be nearly as large. We should have some sort of weight mile tax on the freeloading-sidewalk-stomppers too.

  14. No tax credit should be granted to an “environmentally friendly” vehicle if the vehicle is taxed based upon road usage. A hybrid vehicle still is contributing towards congestion and roadway damage.

    HOWEVER – I would support a road-use tax (a weight-mile tax, possibly in part determined based upon time-of-day and the roadway travelled) that is earmarked for road projects ONLY, in combination with a gas tax that is earmarked towards pollution control (including mass transit) – so long as the idea of “off-road” use is eliminated so that all those construction vehicles that are emitting pollution in the South Waterfront and Portland Mall projects are also taxed towards their contribution towards the air we breathe.

    Thus, a hybrid/electric car is still paying for its use of the road system, but gets a tax break at the gas pump due to being cleaner.

  15. Matthew wrote, in parody of Terry’s remarks: Don’t forget those subsidy loving pedestrians, wearing out the street with their weird shoes and demanding 12 foot sidewalks.

    Your parody isn’t far from Terry’s actual arguments … Terry once wrote:

    […]and most 12 foot wide sidewalks, etc. etc. etc – all frills that are subsidized by taxpayers that should be paid for by the users, and therefore should be on the list.

    And…

    The 12 foot width of sidewalks in most locations is unnecessary, a waste of taxpayer highway or transport dollars when those funds are used to construct them that wide, and should not be viewed as a standard.

    I urge Terry and his supporters to start a ballot initiative to immediately tax sidewalk users and/or narrow the existing 12ft sidewalks to something less objectionable. I think the results of such an initiative would be quite telling.

    – Bob R.

  16. “Al, for the record, this is not an increase, it is an alternative to the existing state gas tax”

    Your saying that this tax will REPLACE an existing tax?

    I would want to see that IN WRITING with all the specifics spelled out before I would support anything like this!

  17. No tax credit should be granted to an “environmentally friendly” vehicle if the vehicle is taxed based upon road usage. A hybrid vehicle still is contributing towards congestion and roadway damage.

    I think the two issues are actually different and ought to be kept separate. There ought to be incentives to use “environmentally friendly” vehicles. But if you tie that to the taxes to maintain roads, you set up the same dynamic you have now with the gas tax. As people increasingly use environmentally friendly cars there is less money to maintain the roads they use.

  18. Your saying that this tax will REPLACE an existing tax?

    I would want to see that IN WRITING with all the specifics spelled out before I would support anything like this!

    Excerpts from the Road User Fee Task Force FAQ page:

    Q: What is the purpose of the Road User Fee Task Force?

    A: The legislature adopted the following statutory purpose for the Road User Fee Task Force: “To develop a design for revenue collection for Oregon’s roads and highways that will replace the current system for revenue collection.”

    Q: What new revenue mechanisms are under consideration by the Road User Fee Task Force to replace the fuel tax on gasoline?

    A: The task force discussed a wide variety of potential revenue mechanisms and set most of them aside. The task force concentrated analysis and developmental efforts in four areas. The broad-based tax mechanism under extensive examination is a mileage fee for vehicle miles traveled within Oregon (“mileage fee”). Other more narrow revenue mechanisms under study to address specific transportation problems are congestion pricing, new facility tolling and studded tire use permits.

    Q: Why is the Road User Fee Task Force examining a fee for mileage traveled?
    A: The task force found a mileage-based fee would be a logical and natural replacement for the fuel tax on gasoline.

    Q: How long would it take to phase in a mileage fee?

    A: Requiring the new electronic odometer technology on new vehicles only would require at least a twenty-year phase in for full market penetration. During any phase in period, the state would have to run two revenue systems at once – the new mileage fee and the current fuel tax on gasoline. Drivers would pay only one or the other and not both.

    Source: http://www.oregon.gov/ODOT/HWY/OIPP/ruftf_faq.shtml

  19. Terry- not just bicyclists! Let’s GPS track pedestrians, too, and people in wheelchairs and strollers who need curb cuts. Why should shut-ins be subsidizing those people? And then tax them! tax them! tax them!

    But seriously, the Economist wrote a great cover story a couple years ago about how our right to privacy has been lost. We lost it to credit cards, to google maps, to email and the web tracking our movements, to database aggregators who know what magazines we buy and organizations we give money to, to bank ATM cameras, to cameras at convenience stores, red-light cameras, having our bank accounts monitored, having our voter records and property ownership records be public, and so forth.

    Lately, we’ve lost our privacy to cell phones (which can track our every move) and things like On-Star. Frankly, if an anonymous computer figures out when I’ve been driving in rush hour traffic and when I’ve using the most costly mode (driving) and how much that costs other people, and then charges me for it, I’m not too violated. Should we make sure those records aren’t public, and can’t be subpoenaed? Sure.

  20. Mike D;

    You might have lost your ‘privacy’, but nobody actually cares what your doing. They just want to know what you buy. (you and 1,000,000,000 other people)

  21. Mike D;

    You might have lost your ‘privacy’, but nobody actually cares what your doing. They just want to know what you buy. (you and 1,000,000,000 other people)

  22. Mike D;

    You might have lost your ‘privacy’, but nobody actually cares what your doing. They just want to know what you buy. (you and 1,000,000,000 other people)

  23. Mike D;

    You might have lost your ‘privacy’, but nobody actually cares what your doing. They just want to know what you buy. (you and 1,000,000,000 other people)

  24. Mike D;

    You might have lost your ‘privacy’, but nobody actually cares what your doing. They just want to know what you buy. (you and 1,000,000,000 other people)

  25. Joseph;

    Thanks, it sounds good, but I have this instinctual distrust for bureaucrats and politicians.

    If its not a wolf in sheep’s clothing then I could buy it!

  26. Joseph;

    Thanks, it sounds good, but I have this instinctual distrust for bureaucrats and politicians.

    If its not a wolf in sheep’s clothing then I could buy it!

  27. Joseph;

    Thanks, it sounds good, but I have this instinctual distrust for bureaucrats and politicians.

    If its not a wolf in sheep’s clothing then I could buy it!

  28. Joseph;

    Thanks, it sounds good, but I have this instinctual distrust for bureaucrats and politicians.

    If its not a wolf in sheep’s clothing then I could buy it!

  29. Joseph;

    Thanks, it sounds good, but I have this instinctual distrust for bureaucrats and politicians.

    If its not a wolf in sheep’s clothing then I could buy it!

  30. Terry: “…bicyclists to open up their wallets and themselves be financially responsible for the specialized and exclusive infrastructure they use…”

    Let’s not let the free-loading schoolchildren off the hook. They expect a quality education, edible meals, heat in the winter, a/c in the summer, books. They should be directly paying for these frills poached from taxpayers or they should not get them at all.

  31. And to all those who continue to think that bicyclists should remain financially irresponsible when it comes to funding what they use; then all bike lanes, bike trails, etc should be opened up so the motorists who subsidize the freeloaders can also use and drive in this exclusive and specialized infrastructure. Furthermore, when sharing the bike lanes with cars, if bicyclists are moving too slow and backing up other traffic, they need to pull over, STOP and let that traffic pass, just like slow moving vehicles on state highways must do.

  32. all bike lanes, bike trails, etc should be opened up so the motorists who subsidize the freeloaders can also use and drive in this exclusive and specialized infrastructure.

    Sounds like a provocative idea there, Terry — why don’t you get to work on lobbying for that one? I know a few good webmasters who would be happy to build you a community site for your constituency.

    – Bob R.

  33. I like the idea of bike infrastructure if A. they are used and B. the bikers pay for it themselves and C. bikers don’t ride on country roads. I have seen bikers on country roads around Forest Grove and McMinnville with 20-30 cars trailing behind because cars can’t pass them with opposing traffic.

  34. This sounds like a good time to pull my 4′-wide car out of the garage and ride it around the bike lanes of Portland. Wheeeee!!!!!!

  35. Bob: The whole point of the GPS is to only tax mileage driven in Oregon and on public roads. If you just use an odometer then you tax mileage driven anywhere. If you drive in Idaho you would pay tax to Oregon. Etc….

  36. I have to say this is crazy and a real threat to us. Our privacy is at risk everyday and now even more so. You have a national ID (Real ID act of 2005) at our door steps. It will take ALL you inforamtion and store it in a database and share it will all other government agencies and through the SPP shared with MExico and Canada. It will have your biometrics (Photo, fingerprints, iris scan, DNA etc), SS#, address, birthdate, weight, height, eye color, divorce papers, and anything else that a government agency has on you no matter where its from. This is a real and present threat. Fight against this stuff and speak out to your representatives, news organizations, and other organizations trying to protect your privacy and other key fundamental Rights as a human. EFF.org, Epic.org, ACLU.org (There good on some issues but not so much on others such as 2nd amendment)

    Here in Va gas tax and other road maintance funds go into transportation fund then the general assembly spend that money on other projects not related to roads at all. Then they come back to the tax payers saying hey we dont have enough money so we need to find more money. More money for bigger government. They need to control spending. Also Why is it that we as American taxpayers can fund the rebuilding on other countries at our expence but when something is needed here in america we dont have the money so we need to collect more taxes. Think about that. The Iraq war is estimated to cost about 3 trillion bucks. I bet we could rebuild our roads with that. And its money we already paid into the system. You also have Obama’s bill in the senate which is a U.N. thing to fund which is $845 Billion dollars. Im so tired of being taxed. You know what stated this country had a lot to do with being over taxed and taxation without representation. They had a tea party because of realitive speaking small taxes. If you truelly add up all your taxes from sales, tire, epa, personally property, income both federal and state, tolls count!, exercise tax, gas tax, phone tax, 911 tax etc you get the point its going to be around 50% or more. We need a new revolution on this planet not just the USA.

    Another thing you can do as a citzen to stop these guys is run for office. local and state offices. Anything. Get in there and represent us the true citzens of america. Stop letting the selected few tell us what to do. Most of the politicians dont even have someone running against them! Thats what you can do. Thats what im going to do next cycle.

  37. James says:
    Im so tired of being taxed.

    Things cost money, my friend. You want things, it costs money. It costs the government money, too, they don’t get stuff for free just because they’re the government.

    The alternative to being taxed is pay-per-use, and nobody wants that either. Do you want to pay a $12 toll every time you use a highway or a bridge, or just pay up to $7 in taxes each time you put $75 of fuel into your gas tank?

    You can’t have your cake and eat it, too.

  38. I haven’t seen any of the people who oppose this tax offering any other solutions to pay for the roads they use. This is a fair tax because is taxes the people who use the roads most. Don’t like it? There are ways to beat it … carpool, plan trips better, walk.

  39. Tax man, I’ve suggested raising the gas tax, since that’s closer to fair based on weight of the vehicle. Just because other people oppose it doesn’t mean nobody’s suggested it.

  40. So the state of Oregon gives a $1,500 tax credit to individuals to buy a hybrid vehicle. If the vehicle lasts 200,000 miles, (which is optimistic on average, it isn’t that the car can’t last that long with proper care, but a lot of cars get totaled in collisions before then,) and it only gets 30 mpg (some hybrid SUVs are that low, but most hydrids do better than that) then the owner will pay $1,600 in [state] gas taxes in the car’s life. So after that is all worked out, the state will see $100 for those 200,000 miles. Less if the car doesn’t last that long, or gets better mpg than I assumed. (And minus interest, because the $1500 is given upfront, and the $1600 is paid back over 15 years or so, so at 6% interest, the state is actually out about $600.) For comparison, a regular car would do 25 mpg, and pay $1,920 in gas taxes if it lasted 200,000 miles. (And Terry: I may be a “freeloading bicyclist” but at least I’m not a “welfare queen hybrid driver” living off the money from the state.)

    There are very few electric vehicles in the state right now, although the governor wants to change that by offering a $4k tax credit on new ones. (Right now the credit is only $1500, same as hybrids.)

    So the question is, can we tweak the existing numbers to see if we can do better? A big improvement to the numbers would come from eliminating or reducing the $1500 tax credit for hybrid cars. There would still be an incentive to buy hybrids, (the $320 gas tax savings,) it would just be smaller. And instead of increasing the credit for electric cars, what better way to encourage them, than to not charge them road taxes?

    So it looks like there are solutions that don’t involve building a new device and putting it in every car, but just changing a few tax forms. I’m not necessarily arguing that we should do that, (I do think we should encourage people to get hybrid and electric cars,) my point is, it is much simpler to do those things than building a new device. And, no, I’m not arguing that we shouldn’t pay for roads or anything, far from it, my point is that a new device isn’t the easiest solution.

    However: the funding gap from the gas taxes isn’t the

  41. [Note to self, use &lt; for <, not <]

    Continued:

    <1% that hybrids and electric cars don’t pay, it is the 50% that inflation has eaten since the last time we raised the gas tax. And so I go back to my original point: This is a political will issue, not a technical one.

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