The Oregon Experiment – The Oregon Experiment – and Iowa Too!and Iowa Too!

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

Structural Issues with Mileage Fee Collection

• Cost of Start Up and Operations

• Collection Enforcement

• Integration with Current Fuel Tax Collection System

• System Redundancy

• Ease of Use by Motoring Public

On-Vehicle Device

GPS Satellite

GPSSatelliteSignals

Characteristics of CollectionVMT collected electronically by zone

Mileage Transfer

On-Vehicle Device

Wireless Gateway

Service Station Building

Wireless Reader

Service Station POS System

• VMT transmitted electronically at fueling stations

• VMT data transfer from vehicles when fueling

• Communication is short range!

• Mileage fee imposed as part of fuel purchase

• Fuel tax deducted from fuel purchase price

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

Characteristics of Collection

On-Vehicle Device

GPSAntenna

RF Antenna OBDII Port

Mileage Allocation

Rush Hour : 50.6

In Oregon : 1,200.7

Non Oregon: 100.0

No Signal : 0.9

31 zones

Vehicle Display

On-Board Equipment for Pilot Program

GPS Receiver

On-Board Equipment for Pilot Program

Mileage Counter

On-Board Equipment for Pilot Program

Display

Wholesale LevelWholesale Distribution

Industry

ODOT

$ Gas Tax

Retail Station

$ Cost of fuel +gas tax reimbursement

System Integration: No change in gas tax collection

Non-mileage fee vehicle Mileage Fee Vehicle

$ Mileage Fee + fuel cost

$ gas tax +fuel cost

Retail Station

Consumer Level

System Integration: Consumers pay either gas tax or mileage fee, not both

ODOT

Gallon & tax data

• If fuel taxes + mileage fees collected are less than 24 cents per gallon paid for fuel, ODOT remits the difference

• If total fuel taxes + mileage fees collected exceed 24 cents per gallon paid for fuel, ODOT sends a bill for the balance due

Retail Station

System Integration: Tax data periodically run through a “true-up” calculation by ODOT

• 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

Road User Fee Pilot Program 

Preliminary Results

While ODOT's evaluation of data from the Road User Fee Pilot Project for technological, administrative and behavioral elements is not be expected until fall 2007, ODOT has reached certain preliminary conclusions. 

Project successes include:

• Zone differentiation • Mileage counting accuracy • Transaction administration integration with gas

tax collections • Mileage data transmission at the fuel pump

• 91 percent acceptance by participating motorists

Areas in need of further development:

• Improve the speed of cash transactions at the fuel pump • Improve mileage data transmission at the fuel pump to 99.99 percent accuracy

Lessons learned include:

• Retrofitting of existing vehicles with mileage counting technology is problematic because technology applications for various vehicle makes and models are not standardized.

• Technical assistance to fuel stations is needed on a continuous basis.

Final Results The final report will include in-depth analysis on:

• Technology assessment • Administrative assessment • Behavior assessment • Participant survey • Identification of implementation issues • The final report is expected to be complete and posted

on the ODOT Web site by fall 2007.

• A New Approach to Assessing Road User Charges • David J. Forkenbrock

Jon G. Kuhl2004

•  • For many years, the mainstay of highway finance in the United States has been the motor fuel tax. This mechanism for assessing road

user charges has certain advantages, perhaps the greatest of which is that the tax is roughly proportional to the distance traveled. Some would argue that it is functionally invisible because motorists generally respond to the total price of a gallon of fuel, not to the tax component of this price.

• The times are changing. In an effort to help the U.S. become more energy independent and to improve the air quality in our cities, the auto industry and the federal government are working cooperatively to design a new generation of vehicles that are either hybrid-a combination of electric and conventional internal combustion power-or are powered by hydrogen fuel cells. Several auto manufacturers also are experimenting with internal combustion engines powered by hydrogen. Various prototype vehicles have performed favorably in early testing, and several hybrid vehicles already have entered the marketplace.

• It will be a few years before vehicles with these new propulsion systems become prevalent enough to severely impair motor fuel tax revenues, but the day almost certainly will come. Thus, this is a propitious time to explore a new approach to assessing road user charges-one that will accommodate vehicles with any of the possible propulsion technologies. This research has been carried out to develop such a new approach.

• We began our research with a clean slate, in that many possible approaches were considered. Ultimately, the choice came down to smart roads and dumb vehicles or smart vehicles and dumb roads. Smart roads already are in operation; various technologies are being used to charge users of high-capacity toll roads (e.g., E-ZPass in the eastern U.S.), but roadside interrogators have little to offer in applications such as residential streets or low-volume county roads.

• Rather quickly, we concentrated on smart vehicle technology: some form of on-board system that would enable a user charge to be assessed on the basis of the distance driven, wherever the travel occurred. In designing the new approach presented in this monograph, we emphasized user friendliness. The new approach must preserve the privacy of the road user, and it must be convenient and amenable to desirable features such as on-board navigation and emergency vehicle location. From the standpoint of the agency operating public roads, the new approach must be secure, robust, reliable, and sufficiently flexible to enable a variety of public policies to be supported.

• Our research has been funded by a special pooled funding arrangement led by the Minnesota Department of Transportation. The participating agencies included 15 state departments of transportation and the Federal Highway Administration. The research was carried out at the University of Iowa's Public Policy Center.

• $17.95, 113 pp., 3 figures, 8 tables, perfect bindingISBN 0-87414-133-8

Project OverviewNational Evaluation of a Mileage-Based Road User ChargeThis overview summarizes a major study to conduct a national evaluation of a new approach forcharging vehicles that travel on public roadways. The new approach applies intelligenttransportation system (ITS) smart-vehicle technology to the problem of assessing road usercharges, allowing them to be fairer, more stable, and more flexible. Though very simple inconcept, the new approach requires that a number of institutional and technological issues beresolved. It is to resolve both types of issues that we are undertaking this research.Part I of this research, which was a three-year effort, was concluded in September 2002. A finalreport is available from the University of Iowa Public Policy Center. This research was fundedthrough a special consortium comprised of the Federal Highway Administration and 15 statedepartments of transportation: California, Connecticut, Iowa, Kansas, Michigan, Minnesota,Missouri, North Carolina, Ohio, Oregon, South Carolina, Texas, Utah, Washington, andWisconsin. As called for by Sections 1919 and 1934 of the Safe, Accountable, Flexible, EfficientTransportation Equity Act: A Legacy for Users (SAFTEA–LU) of 2005, Part II seeks to fieldtestthe concepts developed, so that by the time the federal and state governments considerimplementing it, the new approach will be fully tested and widely understood. Beforeimplementation can be considered, it is vital that so different an approach be thoroughly testedbecause the stakes are high indeed—nationally the amount of revenue generated by road usercharges is substantial, with the motor fuel tax alone generating upwards of $74 billion annually.

Basic Design from Part I The basic operation of the mileage-based road user charge is as

follows: A receiver installed on board study participants’ vehicles uses GPS signals (through triangulation) to determine the vehicle's position. A simple on-board computer stores a file consisting of data polygons, using geographic information systems (GIS). These data polygons define the boundaries of states and, if applicable, sub-state regions such as communities or metropolitan areas. It is thus possible to assess mileage-based road user charges simultaneously for federal, state, and municipal levels of government. A data file is stored in the on-board computer containing the per-mile road user charge for this particular type of vehicle in each participating jurisdiction.

National Evaluation in Part IIFunded at $16.5 million, the purpose of this four-year evaluation study

is to fully test and refine this new approach to assessing and collecting road user charges. The basic approach, just described, is a mileage-based road user charge system that will provide political jurisdictions with great flexibility. An important attribute of the mileage-based approach is that it can accommodate any form of vehicle propulsion system, including current technology gasoline- and diesel fuel-powered vehicles, new electric-hybrid power vehicles, and emerging vehicles that are powered with fuel-cells. At the state and federal levels, it is intended to eventually replace the motor fuel tax, not constitute an additional charge. Each jurisdiction—federal, state, and local— can enact per-mile rates that vary by vehicle attributes and that advance policy considerations.

Field Testing Current plans are for participant recruitment at the six sites to begin

in June 2007. The marketing firms will conduct an aggressive public information campaign using ads in newspapers, television and radio spots, and op eds. Assisting the recruitment efforts will be information regarding the $1,035 that a participant will receive over the course of his or her efforts in support of the study. Specifically, a participant will receive $200 for attending the training session and having the on-board equipment installed, $65 per month for the nine-month test period, and $250 for completing a debriefing and having the equipment removed from his or her vehicle. Receipt of the monthly stipend is conditional upon completing the periodic survey questionnaires.

• Summary

In summary, the National Evaluation of a Mileage Based Road User Charge is the product of almost ten years of research. The design of on-board equipment and data transfer mechanisms has evolved over a considerable amount of time, and the sample design for participant selection likewise is quite refined. We look forward to the insights that will result from the two years of field-testing.

Will this technology work on qualified motor

vehicles?

Current Current

Transponder Transponder

ProgramsPrograms

U. S., Canada, Mexico

California

Massachusetts

Illinois

Florida

Will it work?

–Let’s see………………

Vehicle Miles Traveled collected electronically

Mileage data and fuel purchase info uploaded to fuel retailer PC

IFTA/IRP/Bridge Tolls

Gallons, miles, bridge tolls

IFTA/IRP/bridge tolls amounts due (or refunds) would be calculated and debited (credited) to the carrier’s bank account

The jurisdictional information would be uploaded to the IFTA/IRP clearinghouses and distributed to the jurisdictions

Retail Station

Tax data run monthly through

IFTA/IRP Clearinghouses