Oregon investigates new way to fund transportation

States across the nation are struggling to fund transportation projects. According to the American Road and Transportation Builders Association, there will be a $20 billion revenue shortfall in the 2010 Highway Trust Fund, and a related shortfall for public transit in 2011.

In the past, the easy solution has been to raise gas taxes. But with gas prices reaching more than $4 a gallon last year, that option is not politically feasible. In some states, including Alabama, it has been decades since the state gas tax was raised. Truth be told, the gas tax is a dying means to fund anything – from roads and bridges to even transit (if it were allowed by the Alabama constitution). As green has turned to gold, hybrid cars and fuel efficiency is all the rage, with no signs of returning to the days just a few years ago where SUV’s were king. The entire U.S. auto industry is on the brink of collapse because it bet on big is better, while companies like Toyota are not fairing well, but better, because smaller and more efficient is where they invested.

So roads and bridges are on the brink. Public transportation options are woefully underfunded already. And we have a tax system that is based on a fuel that is likely seeing the beginning of the end. What do we do?

First reported on by Governing magazine in 2007 and recently reiterated by Grist.org, Oregon has been studying since 2001 a plan to charge by the mile, instead of by the gallon. The goal has been to find a revenue-neutral tax that could eventually replace the gas tax when it becomes obsolete. The Oregon DOT released its findings in 2007 on the year-long study of more than 250 drivers who were charged by the mile instead of the gallon.

What did they find?

– More than 90 percent of the participants liked the by-the-mile tax system more than by-the-gallon.
– It could be done efficiently using GPS technology and existing gas stations to read the numbers of miles driven and charge a fee when the vehicle fueled up.
– Most interestingly, where congestion taxes were charged and where they were not, Oregon DOT actually saw a decrease in driving, without an overall decrease in tax revenue.

Could this system be implemented in Alabama? With Alabamians as some of the most heavy drivers of anyone in the country, it might be a tough sell. But it would level the playing field between those who drive less-fuel efficient vehicles and today’s hybrid cars. It would also directly tax use of roadways instead of consumption of gasoline, giving the state ability to charge more for more heavily traveled roads and less for rural roadways. Tax revenue would be then based on roadway demand and not just on consumption of fuel.

Alabama’s roads and bridges are in dire need of repair. Alabama is also one of only four states that does not provide state funding for public transportation. With the gas tax dying, Alabama needs new revenue sources to fix our current infrastructure and to expand public transit opportunities. Oregon predicts a 30-year timeframe to phase in the new mileage tax structure. Where’s ALDOT’s study to address current and future revenue needs for Alabama’s roadways and public transit?

A solution can’t come soon enough.


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