A Comprehensive Review of Critical Issues on Transitioning to a Vehicle Miles Traveled Fee System
A Comprehensive Review of Critical Issues on Transitioning to a Vehicle Miles Traveled Fee System

Author: Dimitra Maragakis

Publisher:

Published: 2014

Total Pages: 128

ISBN-13:

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Due to increased vehicle fuel efficiency, electric vehicles, inflation, and the fuel tax not being raised in the past 20 years, the Highway Trust Fund has been unable to cover the costs associated with expanding and maintaining the transportation system. Despite improved construction methods, better planning and superior materials, municipalities cannot keep up with wear and tear on roadways, let alone keep up with future expansion. There is simply not enough revenue to support the roadway system. This shortfall has led experts to look for alternative solutions to the current major method of funding the Highway Trust Fund: the fuel tax. The most attractive solution to emerge is the Vehicle Miles Traveled (VMT) fee. A VMT fee is an answer to many of the current problems facing fuel taxes such as increased fuel efficiency in vehicles, the rise in hybrids and electric vehicles, and responding to inflation. The VMT fee has been recommended by a number of professionals and experts as a complete replacement for the current fuel tax for these reasons. However, there are many obstacles to this attractive alternative including perception, administration, and implementation. The purpose of this study is to provide a thorough literature review of several states' approaches to the VMT fee, address prominent issues and concerns associated with the VMT fee, and provide several transition schemes which would minimize the concerns of the public, motorists, and decision-makers. It was found that allowing the motorist to choose the VMT fee collection system eases privacy concerns and thus has less resistance when passing the fee through legislation. It was found that allowing for a longer transition phase will be most desirable, because the user will have the option of paying the VMT fee or the fuel tax.

Mileage-Based User Fees for Transportation Funding
Mileage-Based User Fees for Transportation Funding

Author: Paul Sorensen

Publisher: Rand Corporation

Published: 2012-12-28

Total Pages: 58

ISBN-13: 0833079212

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This primer presents some promising and innovative mileage fee system designs and transition strategies. For states or localities that are considering a transition to mileage fees, awareness of these strategies can help determine whether shifting from fuel taxes to mileage fees merits further consideration. For jurisdictions already engaged in detailed assessments of mileage fees, these concepts can help reduce costs and build public support.

A More Perfect User Fee
A More Perfect User Fee

Author: Heath Hansen

Publisher:

Published: 2015

Total Pages:

ISBN-13:

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The United States is currently facing a highway funding crisis. Both federal and state transportation budgets are under mounting duress as road maintenance and construction costs continue to outpace revenues each year. While a number of factors contribute to this problem, one of the primary causes is the inherently flawed nature of gas taxes, which provide the vast majority of revenues for the nation0́9s surface transportation system. In response to growing budgetary shortfalls and the increasingly apparent shortcomings of gas taxes, state and federal policymakers have begun searching for an alternative approach to funding and financing roads. Recently, a concept known as a vehicle miles traveled (VMT) fee has gained popularity among transportation policy experts and policymakers as a potential replacement for the gas tax. Under a VMT fee system, drivers pay for their actual road use instead of, as now, for the motor fuel they consume. Although the concept is new and there exists very little real-world experience with a VMT fee, several pilot studies conducted within the last decade in the United States have demonstrated their potential as a viable, long-term solution to the nation0́9s road funding challenges. In this paper, I examine the concept of VMT fees and evaluate specific VMT fee systems that have been proposed as alternatives to the gas tax. I begin with an overview of the current gas tax system in the United States and then discuss its advantages and disadvantages as well as why it is not a sustainable funding mechanism going forward. In the second section, I examine the general concept of a VMT fee, including its potential benefits, costs, and the challenges associated with transitioning from the gas tax to a VMT fee. Section three outlines seven essential criteria that specific VMT proposals should meet in order to be considered a viable alternative. In the fourth section, I evaluate four different VMT fee proposals that have been 2 tested in pilot studies in the United States based on the six criteria spelled out in Section 3. In section 5, I compare and contrast the four proposals and discuss their relative advantages and disadvantages. Section 6 concludes with recommendations for implementing a VMT fee in the United States.

Comprehensive Equity Analysis of Mileage Based User Fees
Comprehensive Equity Analysis of Mileage Based User Fees

Author: Justin David Carlton

Publisher:

Published: 2015

Total Pages:

ISBN-13:

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Lack of sustainable revenue generation for transportation infrastructure has created a need for alternative funding sources. The most prominent of which is the Mileage Based User Fee (MBUF), where drivers would be charged based on the number of miles they drive, thus holding them accountable for their use of the roadway. While numerous equity related issues have been addressed, the interrelation of transportation taxation and expenditures on all levels of government (State, County, and Local) is not well understood. Using National Household Travel Survey data and information collected from over one hundred agencies, roadway taxation and expenditures were assigned to individual households in the Houston core based statistical area (CBSA). Using both Gini Coefficients and Theil Indices to analyze equity relationships, the research demonstrated that implementation of a MBUF would not have a pronounced effect on the current distribution of transportation taxation and expenditures, with the number of miles traveled and the total transit ridership remaining mostly unchanged. This also means that the equity of a MBUF is mostly equivalent to the current fuel tax. The relative winners of the current system are rural and high income urban households, while the relative losers are all other urban households. Increasing the MBUF to meet the Texas 2030 Committee recommendations would decrease the average benefit to taxation ratio, causing households to receive less than they pay into the system. Additionally, it would decrease the total number of miles traveled by 22.8% and increase transit ridership by as much as 10.2%. Still, equity of this scenario changed little from the equity of the current transportation funding system. However, excluding public transit expenditures resulted in a statistically significant and undesirable change in the Gini Coefficient, indicating that public transit has a positive impact on equity when considering the transportation system as a whole. Due to relatively flat rate taxes (vehicle registration, property tax, sales tax, etc.), the higher the miles driven, the lower the effective tax is per mile. When miles traveled are decreased by 22.8%, the effective tax per mile increases, which is the reason why the average benefit to taxation ratio was reduced. If transportation related taxation were to shift towards user based methods, then the benefit to taxation ratio should tend towards a value of one, indicating that all users receive exactly the value they pay for. If revenues are increased while the methods of taxation remain the same, low income urban households will be negatively impacted to the greatest degree. The electronic version of this dissertation is accessible from http://hdl.handle.net/1969.1/152470

A Framework and Analytical Approach to Evaluate Alternative Vehicle Miles Traveled (VMT) Fee Systems
A Framework and Analytical Approach to Evaluate Alternative Vehicle Miles Traveled (VMT) Fee Systems

Author: Elizabeth V. Ebacher

Publisher:

Published: 2014

Total Pages: 100

ISBN-13:

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Since the fuel tax is a dwindling source of revenue, states need to find alternative funding sources. A vehicle miles traveled (VMT) fee has received serious consideration from a number of states and the federal government. What is missing from the VMT fee consideration is a framework for developing VMT fee systems and an analytical approach with which to study how well a proposed system conforms to the policies promulgated in the framework. This research strives to fill that void. The framework developed presents five areas of importance in VMT fee systems: 1. Revenue sufficiency; 2. Revenue stability; 3. Environmental Justice; 4. Low implementation cost; and 5. Security and privacy preservation. The analytical approach consists of two methods: 1. Use of NPV in order to evaluate the cost/benefit position of a proposed VMT fee system with respect to monetary and non-monetary but monetizable aspects; and 2. Use of an Index to evaluate all other aspects. To demonstrate the application of the framework and analytical approach, four VMT system designs were formulated, analyzed, and then compared to each other and to the fuel tax. The four VMT fee system designs are: 1. Alternative A where the total annual VMT is determined at the state inspection and charged for those miles; 2. Alternative B where the out-of-state VMT is deducted from the total annual VMT as determined at the annual state inspection and the fee charged for in-state VMT only; 3. Alternative C where a fee matrix is applied to GPS reported trip data so that fees may vary based on time and locale; and 4. Alternative D where there is a strategic implementation of Alternatives A, B, and C in that order and with two years separating the implementations. If added revenue is the main goal, then Alternative A is the best choice by being the lowest cost. If added revenue and the provision of a better strategy for alleviating such conditions as congestion, noise or air pollution or charging for higher quality roadways, then Alternatives C or D is the best fit. Alternative B performs best as a stepping-stone in Alternative D. All alternatives have better revenue sufficiency and stability than the fuel tax. The fuel tax exceeds all alternatives with respect to security and privacy preservation since no data, personal or otherwise, is recorded. Since security and privacy preservation are considered the weakest aspects of most VMT fee collection systems, added attention must be applied to incorporating design elements that cover aspects where breaches are possible such as in any data transmission, any computational and database processing, and billing/payment functions. The next step beyond this work is to study the construction of the fee matrix and exercise its use either in simulation or with actual data as collected by a state's department of transportation.

Vehicle Miles Traveled (VMT) Fee Financing Alternatives
Vehicle Miles Traveled (VMT) Fee Financing Alternatives

Author: Ashley Costa

Publisher:

Published: 2012

Total Pages: 50

ISBN-13:

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State Departments of Transportation (DOTs) today are seeking financing alternatives so that transportation infrastructure investments can become less dependent on the amount of fuel U.S. drivers consume. Because the fuel tax is no longer viewed as a sustainable and stable option, other financing alternatives are being considered. One such alternative includes the vehicle miles traveled (VMT) fee. Examples of such VMT fee alternatives include: 1) collection using an onboard diagnostic system (OBD), 2) collection at the fuel pump using an OBD in conjunction with GPS technology, and 3) collection at a vehicle inspection station using the OBD. This proposed research has two primary objectives: 1) to conduct a comparative review of VMT fee alternatives and their data collection methods, payment collection processes, expected costs and revenues, and anticipated challenges; and 2) to examine the suitability of these VMT fee alternative for consideration in Massachusetts. The major results and conclusions are the fuel tax, if increased and reviewed annually, is a viable short term solution and that a VMT fee should be considered further as part of a long term strategy. It is expected that the results of this research will be of interest to Federal and State DOT personnel and policy makers.

Examining the Impacts of a Vehicle Miles Traveled Fee for Daily Weekday Travel
Examining the Impacts of a Vehicle Miles Traveled Fee for Daily Weekday Travel

Author: Michael Alexander Moore

Publisher:

Published: 2022

Total Pages: 0

ISBN-13:

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Mileage-based taxes have been suggested as a long-term solution for collecting fees from highway users. Clustering was used to group respondents to an Oregon traveler survey based on daily travel characteristics. State fuel tax and equivalent VMT taxes are assessed to evaluate the change in revenue associated with a switch to a VMT tax structure and potential impacts upon respondent groups. The difference in revenues were evaluated on a per trip, daily trip, and annual basis. Results show that there is little difference in yearly revenues associated with a switch to VMT fee, with all user groups seeing less than 5% increase compared to fuel tax. The VMT fee is found to be marginally more regressive than the fuel tax. Relative to urban households, rural households were less impacted than urban households resulting from a switch to a VMT fee. Alternative fee structures were developed based on state gas tax revenue distribution and yielded results that when accounting for demand responses showed improvements in the regressivity of the VMT fee