Mileage tax may fund new road repairs

Mitchell Hartman Aug 17, 2009

Mileage tax may fund new road repairs

Mitchell Hartman Aug 17, 2009


Bill Radke: The price of gas has been rising the last few months
— as you probably know — right along with the stock market, which seems like bad news while you’re standing with the nozzle in your tank. But the increase has been great for the people who maintain our streets and highways. Because road repairs are funded through gas taxes. In fact, governments are worrying about what’ll happen to that revenue if more and more people start buying hybrids and plug-in electric cars.

As Mitchell Hartman reports from Portland, Ore.,
the search is on for a new way to tax motorists.

Mitchell Hartman: I started this story by getting in my Toyota Prius and driving about an hour south on I-5 to the state capital, where I went to see Jim Whitty, of the Oregon Department of Transportation.

HARTMAN: I just drove from Portland to Salem, took just about exactly a gallon of gas, since I get about 46 miles to the gallon.

JIM WHITTY: That’s great for the environment. It’s just that if a lot of people start doing that, with highly fuel-efficient vehicles, the revenues for the roads start dropping off because people aren’t paying gas tax. If you want to keep the roads up, we’ve got to find a solution.

Whitty’s in charge of finding that solution in Oregon. His office did a pioneering study of 300 drivers whose vehicles were wired to pay a mileage tax. Every time they pulled up to the pump, a wi-fi receiver logged how far they’d driven. The tax was then added to their bill. They could be charged a higher rate for driving during rush hour.

The main concern of the Oregon drivers? Privacy.

Congress has now funded a nationwide study of drivers from Wichita to Albequerque to Miami. University of Iowa researcher Jon Kuhl will be gauging how willing Americans are to have Uncle Sam sit on their dashboard.

JOHN KUHL: Our cell phones that we all carry around in our pockets are certainly implicitly tracking where we go and providing information about our behavior in much more explicit ways than a system like this would. Yet we’re much more likely to accept that compromise of our privacy.

Because, says Kuhl, we get cell-phone service in return. A system that tracked real-time mileage using GPS could offer services that motorists might want. Oregon’s Jim Whitty says that could outweigh privacy objections.

WHITTY: The devices ought to be able to do other things than raise revenue, to make their driving easier. For example, predicting time on a specific route for getting home, identifying congestion and alternative routes.

If politicians do eventually roll out a mileage tax, it won’t happen overnight. Revenues from the gas tax are now flat. They’re not expected to fall precipitously, until a lot more fuel-efficient vehicles are out on the road, around the year 2020.

I’m Mitchell Hartman for Marketplace.

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