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Saturday, October 4, 2014

California to study alternative to current gas tax

California SB 1077 (Chapter 835, 9/29/14) calls for creation of a Road Usage Charge (RUC) Technical Advisory Committee by the Chair of the CA Transportation Commission. This 15-member committee is to study alternatives to the gas tax and make recommendations to the Transportation Agency for a pilot program to begin by the start of 2017. The preamble to the legislation notes that existing revenues “for highways and local roads are inadequate to preserve and maintain existing infrastructure and to provide funds for improvements that would reduce congestion and improve service.” It also describes the gas tax as “an effective mechanism” for long-term infrastructure needs due to a few factors including use of more fuel efficient cars. It is estimated that by 2030, fuel efficiency will decrease otherwise available gas tax revenues by half. The bill also notes that Oregon has already studied this issue. Any proposal is to consider privacy implications. The work of the committee and items it must consider are detailed in the legislation.

The Senate Floor Analysis (8/26/14) of SB 1077 describes a “trifecta of circumstances” warranting this study:

(1)  The current fuel excise tax is not indexed for inflation.
(2)  Federal and California policies have required greater fuel efficiency for cars, thereby leading to a drop in collections of a tax based on gallons purchased.
(3)  “Demographic trends and state policies are encouraging Californians to drive fewer miles per capital.”
For more about Oregon’s work on an alternative to the gas tax based on gallons purchased (which dates back to 2001) and other information on a vehicle miles traveled (VMT) approach, see:

·         Nellen blog post of 3/16/13 (with links to federal and Oregon activities)
·         Oregon’s Road Usage Charge Program – to test a mileage collection system for 5,000 volunteers starting 7/1/15. Per the website, “may assess a charge of 1.5 cents per mile for up to 5,000 volunteer cars and light commercial vehicles and issue a gas tax refund to those participants. This will not be another pilot program but rather the start of an alternate method of generating fuel tax from specific vehicles to pay for Oregon highways.”
·         Background on Oregon’s Road User Fee Task Force (created by 2001 legislation)
·         Information from the US Federal Highway Administration on Vehicle-miles Traveled (VMT) Fees.
·         CBO, Alternative Approaches to Funding Highways, March 2011
If you want to know more about the gas tax in your state or others - when added, rate, whether adjusted for inflation, etc., the Tax Foundation has a helpful website.

I think it makes sense to change the gasoline excise tax to tie to miles driven rather than gallons purchased. For example, why should someone with a hybrid or electric car, not have to pay for road maintenance and expansion? Technology should enable the necessary data to be collected while still protecting privacy. Also, when Oregon started its study back in 2001, I think there was a greater interest in privacy than exists today. For example, many people already have readers in their cars for toll booths. Also, lots of people post all kinds of private photos and information (including their location) on the web.

The California study sounds like it will explore more than a VMT.

What do you think?

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