Oregon’s Road User Fee Pilot Program
Presented toNEACT
LaGrande, OregonAugust 4, 2005
James Whitty, ManagerOffice of Innovative Partnerships and
Alternative Funding
Road User Fee Task Force
Legislative Mandate:
“To develop a design for revenue collection for Oregon’s roads and highways that will replace the current system for revenue collection.”
Oregon Road Revenue Sources FY 2005(bonding excluded)
State Fuel Taxes36%
Federal Fuel Taxes24%
Vehicle Reg & Title 11%
Weight-Mile Tax20%
State Other Funds6%
Federal Other Funds3%
Source: 2005-2007 Governor's Recommended Budget
Effect of New Technology Vehicles on Highway Fund Revenue
LIGHT VEHICLE FUEL TAX REVENUE
350
400
450
500
550
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Fiscal Year
$ M
illio
ns
Revenue Without MPG Improvement Small Fuel Economy Increase
Medium Fuel Economy Increase Large Fuel Economy Increase
Conclusion
In the future,gas tax revenue
will not bethe primary source
for funding our roads.
• A per-mile charge based on Vehicle Miles Traveled (VMT) within a state
• Replaces fuel tax for participating motorists
A Solution: The Mileage Fee
Policy Requirements
Affordable…...............................
System is accurate and reliable..
Differentiation of boundaries......
Technology
Feasible.............................. Reliable……………….……. Secure…………………..…..
Protects privacy of motorists…….
Minimal evasion potential………...
Minimal burden on private sector..
Seamless transition………………
Collection Possibilities
• Human Data Gathering
• Centralized Electronic Collection
• Toll way-Style Collection
Oregon’s
Mileage Fee Concept
A per-mile charge based on miles driven within Oregon by zone.
Zone 1 = in state
Zone 2 = out of state
Optional
Zone 3 = rush hour
The Concept
How it Works
On-Vehicle Device
mileage reader
Gas to GoCommercial Rd., OR
May 15, 2006 – 8:00 AM
13.5gal @ 205.5 27.74State tax disc. (3.24)Net fuel 24.50
Mileage fee243.3 @ 1.22 2.96
Total Due 27.46
FLEET XXXX3024 27.46
THANK YOU
1 2 3 4
One way signal receivedby car to switch mileagecounter between in-stateand out-of-state zones.
Mileage totals counted forin-state and out-of-state.
No location information is recorded.
Mileage read wirelessly at fueling stations.
Gas tax deducted fromgas purchase price
(24 cents/gallon) andmileage fee added.
• Fuel tax maintained for non-equipped vehicles
• Mileage fee integrates with fuel tax collection system
• Oregon’s weight-mile tax retained for heavy trucks
• Also testing “rush hour” pricing
How it Works
• No vehicle location data stored in vehicle
• No data transferred except mileage totals within zones
• Data transferred only at time of fueling via short range radio frequency
Privacy
Vehicles
• No retrofitting
• Components installed during vehicle manufacture
Service Stations
• Capital costs (Oregon): $33 million
• Annual operating costs (Oregon): $1.6 million
Cost
Less risky – • Bulk of revenue stream
remains at distributor level (fewer taxpayers)
• Mileage fee gradually becomes predominant
System Integration
• Retain current multi-state anti-evasion processes
• Fuel tax retained as redundant system to guard against system failure and tampering
May 14, 2004
Public Demonstration of Mileage Fee TechnologyOregon State University
Corvallis, Oregon
• Zone switching … Successful • VMT data transmission … Successful• Electronic calculation of fee … Successful• Gas tax deducted … Successful• Receipt presented … Successful
Policy Requirements - All Met!
Affordable…...............................
System is accurate and reliable....
Differentiation of boundaries.....
TechnologyFeasible..............................Reliable……………………..Secure………………………
Protects privacy of motorists………
Minimal evasion potential………….
Minimal burden on private sector…
Seamless transition…………………
1. Retrofitting cost versus long phase-in
2. Setting the mileage fee rate
3. Requirements on vehicle manufacturers and fuel distribution industry
4. Interstate system standardization and revenue allocation
5. Integration with federal solution
Policy Issues Remaining
Oregon’s Pilot ProgramTime Line: March 2006 – March 2007
Pre-Pilot: 20-vehicle preliminary control start
Full Pilot: 280 vehicles from one community paying mileage fee in lieu of gas tax; service stations with integrated point-
of-sale systems
Rush Hour: Some pilot volunteers participating in Rush Hour Pricing Group
RUFTF Websitewww.oregon.gov/ODOT/HWY/OIPP/ruftf.shtml