By Reema Griffith/executive director, Washington State Transportation Commission
Washington, along with every state in the nation, utilizes a gas tax to provide a major source of funding for roads and bridges. It has been a reliable workhorse for decades, but its future sustainability is uncertain as vehicles become more fuel-efficient and alternative fuel sources emerge.
We all want to lower our costs of owning a car and many of us want to leave less of a mark on the environment. As gas consumption goes down – for all the right reasons – gas tax revenues also go down, which leads to less available funding to build and maintain critical transportation infrastructure.
Washington’s gas tax was increased in 2016 to the current 49.4 cents per gallon to provide a much-needed infusion of funding to build many transportation projects across the state over the next 16 years. However, forecasts suggest that over the next 20 years, the average miles per gallon (mpg) of vehicles in the state will climb from the current 20.5 mpg to 35 mpg. This equates to a 45 percent reduction in our state’s gas tax revenues per mile driven – a clear indication that we need to identify a new, viable funding source to ensure meeting our future transportation needs.
For these reasons our state, with several others across the country, is anticipating the potential for reduced gas tax revenue and assessing possible solutions to replace the gas tax in the future. One promising approach we’ve been exploring is a road usage charge, which would charge drivers by the mile rather than by the gallon of gas. This approach would be similar to the way people pay for other public services like electricity, water and natural gas. Under a road usage charge system it won’t matter what your car’s mpg is or what fuel you use to power it because all cars would pay the same per-mile rate for using the roads.
After over five years of study, we are ready for Washington drivers to put road-usage charging to the test. We want drivers to experience it first-hand and give us feedback on what works and what doesn’t. We need people from all over the state to participate in the year-long pilot project, beginning in early 2018, to ensure a broad spectrum of perspectives goes into shaping the outcome. We need drivers from urban areas and rural areas, with different income levels, and varying car types from old to new, from gas to electric. Drivers must be part of the solution and help identify a potential replacement for the gas tax – and the pilot project is all about making that happen.
While a road usage charge holds a lot of promise for the future funding of transportation, it can certainly evoke concerns and confusion as it proposes a fundamental shift in how we pay for roads and bridges. Let’s look at some of the myths and facts around road usage charging.
MYTH 1: A road usage charge must utilize GPS technology to work and will monitor individual driving habits and location.
FACT: Road usage charges can be collected without the use of any technology, including location-based technology (GPS). Our state will test four different options in the pilot project, two of which will be no-tech and two high-tech; drivers get to pick one they want to test.
One of the no-tech options is an odometer-read approach where drivers report their total miles driven to the Department of Licensing as part of the vehicle registration renewal process. Road charges would be calculated by multiplying the per-mile rate by the total miles traveled.
Another no-tech approach is a mileage permit where drivers pre-pay for a block of miles, similar to how pre-paid cell phones work. With this permit, drivers are good to go until they run out of miles and need to replenish their permit.
The two high-tech options to be tested utilize technology to increase consumer convenience. One is a mileage meter that utilizes GPS to determine if you are in state and on a public road. If you are on a private road or out of state, road charges will not be assessed. There is another version of the mileage meter that will not have GPS capabilities, but will act as an odometer and submit your total miles driven to the state electronically, rather than requiring drivers to go to the Department of Licensing to manually report them.
The other high-tech option is an application that would allow drivers to report their miles utilizing their smart phone. This will face challenges, but is an approach many states are considering given the widespread usage of smart phones.
MYTH 2: A road usage charge will unfairly impact rural residents and drivers who must drive long distances to get to essential services or work.
FACT: The gas tax and road usage charging carry the same effect as far as distance goes – the farther you drive the more you pay under either approach. In fact we are already paying by the mile today under the gas tax – we just don’t think of it this way. Because the gas tax is consumption-based, your car’s mpg determines your per mile cost. As shown in the chart below, if you drive a car that gets the state’s average 20 mpg, you are currently paying the equivalent of 2.4 cents per mile in gas tax today. Cars that get less than 20 mpg could be paying as much as five times more per mile, than cars that get over 20 mpg. Essentially, less fuel-efficient cars are subsidizing the roads for the more fuel-efficient cars that pay little to nothing in gas tax. This fact demonstrates just how inequitable the gas tax really is.
(See table, top of page)
MYTH 3: A road usage charge will cost drivers more money and generally be unfair compared to the current gas tax.
FACT: If fairness is measured by the cost to drivers, the cost of a road usage charge will be determined by your car’s mpg. A road usage charge ensures everyone pays their fair share for the use of the roads, regardless of their car type, mpg or fuel source. As shown in the chart below, a pickup truck that gets 15 mpg will pay the same road usage charge on a per mile basis, as a Toyota Prius that gets 45 mpg. While this may seem unfair to those who drive more fuel-efficient cars, the fact is those drivers will still enjoy a significant fuel cost savings at the pump, given they fill up much less often than drivers of less-fuel efficient cars.
(See table, bottom of page)
This is a lot of information to digest and contemplate considering it really reshapes how we fund critical infrastructure and road maintenance. It is essential that Washingtonians be part of helping us find the right solution.
The road usage charge pilot project is a test, not necessarily the answer. Your participation in the pilot will help us determine whether a road usage charge is worth carrying forward. Your input and guidance before, during and after the pilot project will directly impact the policies that emerge and the direction our state takes in addressing our growing transportation challenges. Your participation is key, so be a part of the solution and sign up for the test drive. There is no cost to participate. All we ask is that you share your experience and offer your input.
To learn more about the pilot project and sign up, please visit waroadusagecharge.org.
Reema Griffith is executive director of the Washington State Transportation Commission. Reach her at: griffiR@wstc.wa.gov.