Electronic toll roads envisioned for nation

Courtesy of Journal Sentinel, by Rick Barrett, and Bloomberg News: With Congress reluctant to raise the gasoline tax, and with the nation’s highways in need of repair and expansion, motorists everywhere may eventually have to come to grips with the notion of more highway tolls and usage fees – possibly collected via electronic monitoring devices built directly into their vehicles.

That’s one idea suggested by a Milwaukee-based trade group, the Association of Equipment Manufacturers, which represents major road-building equipment firms.

It certainly will take more than the traditional gas tax, Dennis Slater, president of the group, said in a conference call with reporters this week.

It’s been 20 years since Congress last increased the federal gas and diesel taxes that historically have paid for highways. Meanwhile, the cost of road and bridge construction has gone up, while the purchasing power of fuel taxes has declined by more than a third.

Two reasons there’s less money from gasoline taxes: People have been driving fewer miles due to the uncertain economy and cars have become more fuel-efficient.

The manufacturers group says usage fees could help close the resulting gap.

Under one proposal discussed by the group, people using the highway system would pay a fee that would be collected through an “E-ZPass”-like system similar to the one used on Illinois toll roads – but collected entirely electronically, with no tollbooths.

The revenue would be used exclusively to restore, maintain and expand the interstate highway system.

Fees would be set annually by an independent group of experts and users of the system, and they would not be used to control the level of traffic or to “price out” drivers from using the highway system.

“You could have a three-tier system where people driving in heavily traveled corridors would pay more to keep those routes in good shape,” said Jack Schenendorf, a Washington, D.C., attorney who was vice chairman of a federal commission tasked with finding ways to fund highway improvements.

People in rural areas, where roads need fewer repairs, would pay less.

“You could set the rates in an equitable way,” Schenendorf said.

Another possible method of paying to maintain the nation’s highway system – a vehicle-miles-traveled system – would require some way of measuring travel, raising the specter of the government’s tracking the movements of every car and truck. There would be privacy objections, said Slater, which means it’s not likely to happen anytime soon.

“It would take time for people to get comfortable with the fact that it would be put into cars. But we have the technology to do this; we would just need to set limits so the devices record only the data we need,” Slater said.

If Congress were to eventually replace fuel taxes with a vehicle-miles-traveled system, coming up with the $54.4 billion currently provided for highway and transit projects by fuel taxes and other sources would require an average tax rate of about 1.8 cents per mile, according to the Federal Highway Administration.

Someone driving 12,000 miles per year, at that rate, would pay about $220 a year. The rates may be lower if the levy varied by vehicle size, as highway tolls do, and by location.
Tough road for tolls

Supplanting or supplementing fuel taxes with tolls would be no simple matter politically, and not just because there would likely be public opposition.

Only 15 states, mostly in the Northeast and Midwest, that had turnpikes before the 1956 advent of the interstate highway system have grandfathered permission to collect tolls on nearly 3,000 miles of the 47,000-mile system. Federal restrictions prevent other states from placing tolls on federal-aid highways, except in limited circumstances.

Still, Schenendorf said, “I think Congress is going to be looking at all of the funding alternatives,” including usage fees.

The U.S. Highway Trust Fund, designed to pay for U.S. road and transit projects, is about 90% funded by taxes of 18.4 cents per gallon of gasoline and 24.4 cents for diesel fuel. The Congressional Budget Office, in a report last May, said the amount of money available to the Trust Fund may decline as much as 13% by 2022, with automakers required to increase the average fuel economy of their fleets to 54.4 miles per gallon by 2025.

“If you can’t raise the tax, because there’s not political support, then how are we going to fund our highway system? The current system isn’t sustainable,” Schenendorf said.

Already, experiments are under way around the country. States including Iowa and Oregon have tested vehicle-miles-traveled taxes with volunteer drivers. In Oregon’s test, people could report the number of miles driven or give more information about where they drove.

Last week, lawmakers in the state of Washington unveiled a transportation revenue package that would raise $9.8 billion over the next decade with the help of a 10-cent bump in the state gasoline tax, a new annual car registration fee pegged at 0.7% of the vehicle’s value, and more than $3 billion in new bonds.

On the other hand, the Virginia General Assembly this week passed legislation that requires legislative approval of tolls on I-95 south of Fredericksburg.

While not an outright ban on new tolls, it’s an example for other states to follow, Bill Graves, chief executive officer of the American Trucking Associations, said in a news release.

Truckers generally remain skeptical of tolls and usage fees.

“We believe that fuel taxes could keep up (with highway improvement costs) if our political leaders had some will to do it,” said Sean McNally, a spokesman for the trucking group, based in Arlington, Va.

In Wisconsin, a proposal from the state Transportation Finance and Policy Commission would raise truck registration fees 73%, said Tom Howells, president of the Wisconsin Motor Carriers Association. Under that proposal, he said, the registration fee for an 80,000-pound truck would increase from $2,575 to $4,455, making it the highest such fee in the United States.

“We are very much opposed to that. It would make it hard for our members to be competitive with somebody operating out of Iowa, Michigan or Minnesota,” he said.

Separately, a proposed amendment to the state constitution, supported by motorist group AAA Wisconsin, would protect the state’s transportation fund from being raided for non-highway purposes.

“Our members are not happy that previous Wisconsin budgets have diverted more than $1 billion in transportation revenue to be misused to support general-fund spending. It is a breach of trust between taxpayers and their government when taxes are imposed and collected for a specific purpose, but then are intentionally directed elsewhere to pay for other unrelated programs,” Tom Frymark, AAA Wisconsin regional president, said in a memo to the Senate Committee on Transportation.

Category: Driver Stuff, Featured, General Update, Transit News