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Oregon To Test Switching To Mileage-Based Gas Tax

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Oregon To Test Switching To Mileage-Based Gas Tax

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Oregon To Test Switching To Mileage-Based Gas Tax

Oregon To Test Switching To Mileage-Based Gas Tax

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So far, it's a voluntary program. But as cars become more fuel efficient, the state could expand it, if it proves to be a successful way of offsetting stagnant gas tax revenues.

RENEE MONTAGNE, HOST:

Gas taxes are key to funding roads you drive on, though now more fuel-efficient cars using less gas have meant less taxes coming in. So Oregon is trying something new - instead of paying a flat tax per gallon, drivers would pay a flat tax per mile. Chris Lehman of Northwest News network explains.

CHRIS LEHMAN, BYLINE: When it comes to paying more for the upkeep of Oregon roads, Tom Fuller has seen the light.

TOM FULLER: Prius drivers ought to be contributing to road maintenance 'cause we use the roads like everybody else. So, yeah, it makes sense.

LEHMAN: Of course, Fuller has to be a fan of Oregon's pay-by-the-mile tax. He's the spokesman for the Oregon Department of Transportation. And he's one of a select few drivers who took part in a trial run of the new program called OreGo this spring. The voluntary program opens to the public in July.

FULLER: So here's my 2012 Prius.

LEHMAN: When you sign up for OreGo, you get a little electronic gadget in the mail.

FULLER: And the little port where this little device goes is kind of under the steering wheel so...

LEHMAN: It's the same place your mechanic plugs in the diagnostic computer. This device won't tell you what's wrong with your car, but it does track your mileage, and each one of those miles will cost you 1.5 cents. The OreGo device also measures how much gas you put in your car.

UNIDENTIFIED WOMAN: Hi.

FULLER: Hello. Can you fill it with regular?

LEHMAN: So when Fuller pulls into a station, he fills up just like anybody else.

FULLER: All right, let's see how much this is going to take. So looks like I used 5.6 gallons of gas on this last thing. And my tank was just under half.

LEHMAN: Those 5.6 gallons of gas cost Fuller $1.68 in state gas taxes. The pump doesn't know that he's part of the OreGo program, but the car does. So at the end of the month, all the tax he paid at the pump is deducted from the per-mile charge that way he isn't dinged twice. On average, Fuller pays more in fuel taxes than he would if he stuck with the traditional method. On the other hand, a driver of a gas-guzzler would pay less with the mileage tax. That twist has some environmental groups skeptical.

CHRIS HAGERBAUMER: People should be incentivized to buy more fuel-efficient cars, such as electric vehicles, hybrid electric vehicles and so on.

LEHMAN: Chris Hagerbaumer is with the Oregon Environmental Council. She points out that Oregon used to hand out tax credits to people who bought hybrids. Now, it's moving toward a system that essentially penalizes people with fuel-efficient vehicles. Hagerbaumer understands the need to pay for highways, but she says, inefficient cars cost society a lot.

HAGERBAUMER: They're contributing to climate change and contributing to air quality problems.

LEHMAN: Hagerbaumer suggests less fuel-efficient vehicles should pay more as a way to offset their emissions. But state transportation officials say a gas tax of any kind is simply a way to fund road construction, not a way to encourage fuel efficiency. And the Department of Transportation's Tom Fuller says hybrid owners like him ultimately pay less to drive their vehicles under any tax system.

FULLER: It cut my gas bill in half, but that also means that I pay half the amount in fuel tax that I used to.

LEHMAN: Even when Oregon's pay-by-the-mile tax goes live, it will still be somewhat of an experiment. Just 5,000 drivers can sign up. Oregon lawmakers could expand the program if it proves successful. For NPR News, I'm Chris Lehman in Salem, Ore.

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