States Explore Counting Miles To Replace Gas Tax

Oregon DOT project manager Jim Whitty. i

Oregon DOT project manager Jim Whitty checks the mileage readout on a test vehicle in Salem, Ore. Tom Banse for NPR hide caption

itoggle caption Tom Banse for NPR
Oregon DOT project manager Jim Whitty.

Oregon DOT project manager Jim Whitty checks the mileage readout on a test vehicle in Salem, Ore.

Tom Banse for NPR

Portland motorist Walter Daggett has seen the future. Well, maybe — if the future includes a digital mileage counter and a roof-mounted antenna.

Plans for superefficient cars including plug-in hybrids and fully electric sedans are forcing lawmakers to consider alternatives to the gas tax. A charge based on the miles you drive just won the endorsement of a commission created by Congress.

The Obama administration doesn't like the idea. But Oregon — the first state to introduce a gas tax in 1919 — along with other states is leading the charge to explore this option.

Daggett, a Mercedes owner, was one of 300 volunteers in the largest field trial to date for mileage-based road financing. During the experiment, he paid about a penny per mile driven instead of the state gas tax when he refueled.

A "small, unobtrusive" control unit fit on the car's dashboard, he says. "It was very user-friendly. It required nothing from me. Turn the engine on and it started the process."

Big Brother On The Road

The state of Oregon, which organized the yearlong experiment, says the field trial proved an odometer fee is viable. Not everyone is onboard, though. Salem, Ore., driver Wayne Brady worries about privacy and practicality.

"You have to install equipment on the cars. You have to install equipment at gas stations. And then the state has to have an agency to manage all this," says Brady, a volunteer lobbyist for the Taxpayer Association of Oregon. "The gas tax seems like such a simple solution. If they need more revenue, then raise the gasoline tax."

Commission Weighs In On Gas Tax

Last Thursday, a congressionally created panel, the National Surface Transportation Finance Commission, recommended in its final report that Congress swiftly raise the federal gas tax by 10 cents per gallon and begin indexing the levy to inflation. The federal gas tax now stands at 18.4 cents per gallon. The panel also recommended that Congress fund a variety of pilot projects around the country to help refine mileage tracking and billing technology. That would pave the way to fully replace the gas tax with a mileage-based user fee by 2020.

Commission Chairman Robert Atkinson says "radical innovations" in vehicle design make it necessary to find new ways to pay for road building and maintenance.

"We found that the sustainability of the fuel tax system is eroding and could erode much more rapidly than people anticipate," he says.

Opposition From The Obama Administration

But before Atkinson even stepped before the microphones at the National Press Club, the Obama administration moved to park the idea. Presidential press secretary Robert Gibbs flatly ruled out shifting to vehicle mileage charges.

"I can weigh in on it and say that it is not and will not be the policy of the Obama administration," Gibbs said.

Jim Whitty, who managed the mileage tax pilot project at the Oregon Department of Transportation, says the White House was probably thinking, "We don't need another controversy right now."

Growing Interest From States

Whitty and Oregon Gov. Ted Kulongoski want to move forward with the technology. Minnesota is on the verge of starting its own field trials. At least 17 other states in addition to Oregon and Minnesota have expressed interest in charging drivers by the mile. Still, Whitty says federal involvement will be needed in the long run to get the automakers onboard. That's because it'd be simplest to embed mileage tracking technology at the factory.

"A state theoretically can implement a mileage-based charge independently of the national government or any other state," he says. "It is much harder to do, however, because it's difficult to get the national industries that are necessary to develop this system to the table."

Whitty is confident a system could be designed to alleviate privacy concerns. He also says people who drive fuel-efficient cars could pay a cheaper rate per mile. That would preserve price incentives for fuel conservation. But the hardest design challenge doesn't involve engineers: It's how to win public acceptance.

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