Moving to a VMT Tax

[kernals12]

As electric cars proliferate, gasoline tax receipts will fall, causing the source of most funding for road maintenance and construction to dry up. The obvious solution is a fee levied on miles driven. Here's how I envision such a system working

Economists may fantasize about a fancy GPS system that varies the rate of tax based on location and time of day, so that it's higher in big cities during rush hour and low in rural areas at 3 in the morning. But the administrative complications and privacy concerns are a major roadblock. More likely, we will end up with a flat fee that varies for different types of vehicles. It would probably be something like this

1 Cent/Mile for Motorcycles
3 Cents for Passenger Cars and Light Trucks
6 Cents for Medium Duty Trucks
12 Cents for Heavy Duty Trucks

For simplicity, all states should operate on one system, probably to be operated by EZPass

One compromise to economic efficiency would be registering if you drive in a different state. People who live in Connecticut and work in New York should pay for the upkeep of the roads in New York that they drive on. As you drive down the Merritt Parkway, the system will charge you a fee to be given to ConnDOT, but once you cross over into New York, GPS will register that and switch over to billing you on behalf of NYSDOT. Your bill, given at the end of each month, will break down which states you drove in and how much you owe.

This data could also be shared with insurance companies to make pay per mile car insurance much more feasible. This is good because people who drive more obviously pose a greater risk and by increasing the marginal cost of driving without increasing the average cost, it would be a way of internalizing more of the societal costs of driving without increasing taxes.

Those are my thoughts. Does anyone else have any?

[SectorZ]

We need less tracking of people, not more.

Most northeast states have annual inspections. Get the mileage from that.

[Max Rockatansky]

So why should a given state tax any of following miles?

-  Miles driven on non-state maintained roads? 
-  Miles driven out of the state you reside in?
-  Miles driven on Forest Service Roads?
-  Miles driven on private roads?
-  Miles driven on National Park Roads?

I just throw that out there because these are questions people would ask and where objections would likely come from.  The constant GPS surveillance thing you propose likely would not get much support given privacy concerns.

[kernals12]

So why should a given state tax any of following miles?

-  Miles driven on non-state maintained roads? 
-  Miles driven out of the state you reside in?
-  Miles driven on Forest Service Roads?
-  Miles driven on private roads?
-  Miles driven on National Park Roads?

I just throw that out there because these are questions people would ask and where objections would likely come from.  The constant GPS surveillance thing you propose likely would not get much support given privacy concerns.

It wouldn't be constant, it would only register movement over state borders, so no, states would not bill for miles driven out of state.

Locally maintained roads are mostly for access to property parcels and for distributing utilities, for the benefit mainly of property owners, not motorists, so those roads should be paid for with local property taxes as is the case today. Of course this cross subsidy cuts both ways, when a state builds a new highway, property values in the surrounding area skyrocket and yet property owners don't pay for this benefit.

Mileage on forest service, national park, and private roads are so low they can be ignored and the complications that would come with distinguishing them would make it prohibitively expensive.

[hotdogPi]

Locally maintained roads are mostly for access to property parcels and for distributing utilities, for the benefit mainly of property owners, not motorists, so those roads should be paid for with local property taxes as is the case today. Of course this cross subsidy cuts both ways, when a state builds a new highway, property values in the surrounding area skyrocket and yet property owners don't pay for this benefit.

In most states, locally maintained means anything without a number. In Massachusetts and a few other states, even some segments of roads with a number are locally maintained.

[kernals12]

Locally maintained roads are mostly for access to property parcels and for distributing utilities, for the benefit mainly of property owners, not motorists, so those roads should be paid for with local property taxes as is the case today. Of course this cross subsidy cuts both ways, when a state builds a new highway, property values in the surrounding area skyrocket and yet property owners don't pay for this benefit.

In most states, locally maintained means anything without a number. In Massachusetts and a few other states, even some segments of roads with a number are locally maintained.

And?

[hotdogPi]

Locally maintained roads are mostly for access to property parcels and for distributing utilities, for the benefit mainly of property owners, not motorists, so those roads should be paid for with local property taxes as is the case today. Of course this cross subsidy cuts both ways, when a state builds a new highway, property values in the surrounding area skyrocket and yet property owners don't pay for this benefit.

In most states, locally maintained means anything without a number. In Massachusetts and a few other states, even some segments of roads with a number are locally maintained.

And?

To use a local example, if there's a VMT tax, why should drivers not have to pay to take Cedar St. in Wellesley even though it's not residential? I do support spreading out traffic on more roads so that the ones above capacity have fewer cars, but I understand that you have the opposite goal and want a strict hierarchy; tolling state-maintained roads but not town-maintained roads will push people toward the town-maintained roads.

(Side note: I always hesitate when I see "VMT tax". It's fine, though; T doesn't stand for tax.)

[kernals12]

Locally maintained roads are mostly for access to property parcels and for distributing utilities, for the benefit mainly of property owners, not motorists, so those roads should be paid for with local property taxes as is the case today. Of course this cross subsidy cuts both ways, when a state builds a new highway, property values in the surrounding area skyrocket and yet property owners don't pay for this benefit.

In most states, locally maintained means anything without a number. In Massachusetts and a few other states, even some segments of roads with a number are locally maintained.

And?

To use a local example, if there's a VMT tax, why should drivers not have to pay to take Cedar St. in Wellesley even though it's not residential? I do support spreading out traffic on more roads so that the ones above capacity have fewer cars, but I understand that you have the opposite goal and want a strict hierarchy; tolling state-maintained roads but not town-maintained roads will push people toward the town-maintained roads.

(Side note: I always hesitate when I see "VMT tax". It's fine, though; T doesn't stand for tax.)

The state should tax drivers for use of locally maintained roads even if they don't pay for their upkeep. But on the flipside, Routes 9 and 128 make property in Wellesley far more valuable than otherwise would be the case, and yet residents don't pay a cent in property taxes toward their upkeep.

[Max Rockatansky]

Locally maintained roads are mostly for access to property parcels and for distributing utilities, for the benefit mainly of property owners, not motorists, so those roads should be paid for with local property taxes as is the case today. Of course this cross subsidy cuts both ways, when a state builds a new highway, property values in the surrounding area skyrocket and yet property owners don't pay for this benefit.

In most states, locally maintained means anything without a number. In Massachusetts and a few other states, even some segments of roads with a number are locally maintained.

And?

To use a local example, if there's a VMT tax, why should drivers not have to pay to take Cedar St. in Wellesley even though it's not residential? I do support spreading out traffic on more roads so that the ones above capacity have fewer cars, but I understand that you have the opposite goal and want a strict hierarchy; tolling state-maintained roads but not town-maintained roads will push people toward the town-maintained roads.

(Side note: I always hesitate when I see "VMT tax". It's fine, though; T doesn't stand for tax.)

The state should tax drivers for use of locally maintained roads even if they don't pay for their upkeep. But on the flipside, Routes 9 and 128 make property in Wellesley far more valuable than otherwise would be the case, and yet residents don't pay a cent in property taxes toward their upkeep.

That's where you get into questions like the one I proposed above.  There likely will be massive opposition politically to inducing a user fee or tax to fund State Highway Departments on roadways they don't maintain.  This is where the rabbit hole of things like diversion to the general funds happen now with a gas tax.  A lot of your reasoning is predicated on people not resisting measures like a mileage tax, to which there will likely will be.  It is more a matter if that can he defeated politically or how much a mileage system survives being put through the political ringer.

[vdeane]

So why should a given state tax any of following miles?

-  Miles driven on non-state maintained roads? 
-  Miles driven out of the state you reside in?
-  Miles driven on Forest Service Roads?
-  Miles driven on private roads?
-  Miles driven on National Park Roads?

I just throw that out there because these are questions people would ask and where objections would likely come from.  The constant GPS surveillance thing you propose likely would not get much support given privacy concerns.

It wouldn't be constant, it would only register movement over state borders, so no, states would not bill for miles driven out of state.

Locally maintained roads are mostly for access to property parcels and for distributing utilities, for the benefit mainly of property owners, not motorists, so those roads should be paid for with local property taxes as is the case today. Of course this cross subsidy cuts both ways, when a state builds a new highway, property values in the surrounding area skyrocket and yet property owners don't pay for this benefit.

Mileage on forest service, national park, and private roads are so low they can be ignored and the complications that would come with distinguishing them would make it prohibitively expensive.

Good luck getting people to believe that the GPS only tracks for state line changes.  People already slow down for toll gantries even though they don't operate as speed cameras.  And how accurate will that be?  The last few times I've opened Google Maps on my phone, it thought I was several miles away from where I actually was.

[1995hoo]

I don't understand the proposition that a GPS would only register when you cross a state line. How would it figure the miles driven in a given state? That is, for example, suppose two different people are driving from New York to Atlanta. One guy uses the Jersey Turnpike/I-95/I-85 route. The other guy has to make a couple of stops en route and largely uses the same route, but he exits I-95 to use VA-3 and VA-20 to Charlottesville, then VA-20 to US-15 and US-460 to Blackstone, Virginia, and then connects to I-85 to Atlanta. So both drivers cross the same state lines in the same locations, but the second driver incurs a lot more mileage in Virginia. How does this system adjust for that?

I still cite the same thing I say any time someone starts about GPS tracking for mileage. A former work colleague of mine–a black man who lived in Charles County, Maryland–was all for the idea of GPS tracking and taxing until I said, "So you'll be OK with it if the police show up at your door and say, 'Mr. [his last name], we're investigating a crime spree in Potomac and we want to talk to you. Your car was there, according to GPS records, but that's a predominantly-white neighborhood and you're black. Why were you there?'" He froze at that thought. It wasn't at all far-fetched to him. Don't think it couldn't happen, either. Of course it could. E-ZPass data are already subject to subpoena and have been cited as evidence in things like divorce proceedings, and I'm sure grand juries have used that sort of thing as well. It's not far-fetched at all, and if history in this country teaches us anything, it's that any sort of technical advances happen without privacy protections until it's too late–the barn door is open and you'll never get the animals back in.

[kernals12]

I don't understand the proposition that a GPS would only register when you cross a state line. How would it figure the miles driven in a given state? That is, for example, suppose two different people are driving from New York to Atlanta. One guy uses the Jersey Turnpike/I-95/I-85 route. The other guy has to make a couple of stops en route and largely uses the same route, but he exits I-95 to use VA-3 and VA-20 to Charlottesville, then VA-20 to US-15 and US-460 to Blackstone, Virginia, and then connects to I-85 to Atlanta. So both drivers cross the same state lines in the same locations, but the second driver incurs a lot more mileage in Virginia. How does this system adjust for that?

I still cite the same thing I say any time someone starts about GPS tracking for mileage. A former work colleague of mine–a black man who lived in Charles County, Maryland–was all for the idea of GPS tracking and taxing until I said, "So you'll be OK with it if the police show up at your door and say, 'Mr. [his last name], we're investigating a crime spree in Potomac and we want to talk to you. Your car was there, according to GPS records, but that's a predominantly-white neighborhood and you're black. Why were you there?'" He froze at that thought. It wasn't at all far-fetched to him. Don't think it couldn't happen, either. Of course it could. E-ZPass data are already subject to subpoena and have been cited as evidence in things like divorce proceedings, and I'm sure grand juries have used that sort of thing as well. It's not far-fetched at all, and if history in this country teaches us anything, it's that any sort of technical advances happen without privacy protections until it's too late–the barn door is open and you'll never get the animals back in.

If you've driven 100 miles in Virginia, it would be recorded in your account as VA: 100. Then when you cross the state border into North Carolina, it will stop counting for Virginia and start counting for North Carolina and continue to do so until you reach South Carolina.

[Scott5114]

Might be best to just say, for personal cars, that the taxes go to whichever state's license plate the vehicle carries. If I register it in Oklahoma, Oklahoma gets all the mileage associated with it. Is that fair to states like Kansas and Missouri, whose drivers spend a lot of time on the other state's roads? No, but it's the least bad option, especially since most people's daily driver has a negligible impact on road maintenance costs, only road capacity, and most individual people do the vast majority of driving in the state their car is plated in.

If cross-border traffic is really a concern, the states involved could form a compact to pool their money and distribute it as they feel more appropriate. New England would be a good candidate for this, since I imagine there are lots of people who live in RI and commute to MA or CT, and so on.

For local roads, I'm not sure why it wouldn't just be handled like the federal road fund is now–state collects so much money, allocates a certain amount to the DOT, then turns over the rest to city and county DOTs according to a formula of some kind, probably based on the number of cars registered there.

It may be worth doing a GPS-type system for commercial vehicles, since many of them are already subject to more stringent logging requirements anyway, and the state has a compelling interest in looking at that data to spot safety issues (e.g. that adequate breaks are being taken). Since that would cover the vast amount of vehicles with a high enough GVW to damage the roads, that would help to finesse the inequities of the personal-car system described above.

[Revive 755]

Since electric vehicles are one of the main considerations for a VMT tax:  Is there a reason we couldn't or shouldn't build some sort of taxing mechanism right into the charging apparatus, something that tracks and charges based on the power used?

I could see this being an issue with the residential/in home chargers (tampering?) as well as having to retrofit existing chargers.  Probably wouldn't work if there is ever some sort of in roadway charging mechanism that can charge vehicles while they are being driven.

[1995hoo]

I don't understand the proposition that a GPS would only register when you cross a state line. How would it figure the miles driven in a given state? That is, for example, suppose two different people are driving from New York to Atlanta. One guy uses the Jersey Turnpike/I-95/I-85 route. The other guy has to make a couple of stops en route and largely uses the same route, but he exits I-95 to use VA-3 and VA-20 to Charlottesville, then VA-20 to US-15 and US-460 to Blackstone, Virginia, and then connects to I-85 to Atlanta. So both drivers cross the same state lines in the same locations, but the second driver incurs a lot more mileage in Virginia. How does this system adjust for that?

I still cite the same thing I say any time someone starts about GPS tracking for mileage. A former work colleague of mine–a black man who lived in Charles County, Maryland–was all for the idea of GPS tracking and taxing until I said, "So you'll be OK with it if the police show up at your door and say, 'Mr. [his last name], we're investigating a crime spree in Potomac and we want to talk to you. Your car was there, according to GPS records, but that's a predominantly-white neighborhood and you're black. Why were you there?'" He froze at that thought. It wasn't at all far-fetched to him. Don't think it couldn't happen, either. Of course it could. E-ZPass data are already subject to subpoena and have been cited as evidence in things like divorce proceedings, and I'm sure grand juries have used that sort of thing as well. It's not far-fetched at all, and if history in this country teaches us anything, it's that any sort of technical advances happen without privacy protections until it's too late–the barn door is open and you'll never get the animals back in.

If you've driven 100 miles in Virginia, it would be recorded in your account as VA: 100. Then when you cross the state border into North Carolina, it will stop counting for Virginia and start counting for North Carolina and continue to do so until you reach South Carolina.

That didn't answer my question. In your earlier post that vdeane quoted, you said the system "would only register movement over state borders." But I asked how you account for two people who cross into and out of the state–I used Virginia as an example–at the same location, yet one of them uses a very different route within that state that adds more distance driven. Or are you saying that would be ignored? (I'm typing this on my iPad, so I can't easily get the distances because the Google Maps app doesn't allow for dragging the line around to adjust the route, and when you add destinations to force it to use the route you want it doesn't show the full distance for the whole trip.)

[Rothman]

Regarding local roads, in NY, local projects are heavily subsidized with state funds through the CHIPS and Marchiselli programs.  Federal funds also flow through state DOTs to municipalities and the like.

[Bitmapped]

Might be best to just say, for personal cars, that the taxes go to whichever state's license plate the vehicle carries. If I register it in Oklahoma, Oklahoma gets all the mileage associated with it. Is that fair to states like Kansas and Missouri, whose drivers spend a lot of time on the other state's roads? No, but it's the least bad option, especially since most people's daily driver has a negligible impact on road maintenance costs, only road capacity, and most individual people do the vast majority of driving in the state their car is plated in.

If cross-border traffic is really a concern, the states involved could form a compact to pool their money and distribute it as they feel more appropriate. New England would be a good candidate for this, since I imagine there are lots of people who live in RI and commute to MA or CT, and so on.

For local roads, I'm not sure why it wouldn't just be handled like the federal road fund is now–state collects so much money, allocates a certain amount to the DOT, then turns over the rest to city and county DOTs according to a formula of some kind, probably based on the number of cars registered there.

It may be worth doing a GPS-type system for commercial vehicles, since many of them are already subject to more stringent logging requirements anyway, and the state has a compelling interest in looking at that data to spot safety issues (e.g. that adequate breaks are being taken). Since that would cover the vast amount of vehicles with a high enough GVW to damage the roads, that would help to finesse the inequities of the personal-car system described above.

I've suggested the exact same type of system for most vehicles - the state where the car is registered collects all state VMT fees. I imagine that in most cases, the revenue gained from out-of-state trips would probably be about a wash with revenue lost from not taxing non-residents. It's simple and avoids privacy concerns from tracking movements.

For vehicles that currently have logging requirements, I'd just keep those as-is. There's no real reason to change.

[kalvado]

Since electric vehicles are one of the main considerations for a VMT tax:  Is there a reason we couldn't or shouldn't build some sort of taxing mechanism right into the charging apparatus, something that tracks and charges based on the power used?

I could see this being an issue with the residential/in home chargers (tampering?) as well as having to retrofit existing chargers.  Probably wouldn't work if there is ever some sort of in roadway charging mechanism that can charge vehicles while they are being driven.

Things would be fairly straightforward If manufacturer cooperates and introduce some sort of taxing consideration into car firmware

[GaryV]

^ We already have such a device.  It's called an odometer.

But that means that a VMT tax would be collected in big visible chunks. Which people don't like - they don't like being reminded of how much taxes they pay.

That's why we have income tax withholding.  To partially hide the amount of taxes collected.  Because gee whiz, I got a $150 refund.

And remember, we've been having to bribe people (sorry, give tax credits to people) to buy electric vehicles.  Now you want to collect extra taxes on them?

[Max Rockatansky]

^ We already have such a device.  It's called an odometer.

But that means that a VMT tax would be collected in big visible chunks. Which people don't like - they don't like being reminded of how much taxes they pay.

That's why we have income tax withholding.  To partially hide the amount of taxes collected.  Because gee whiz, I got a $150 refund.

And remember, we've been having to bribe people (sorry, give tax credits to people) to buy electric vehicles.  Now you want to collect extra taxes on them?

I think the OP is running under the assumption all these 2035 EV sale mandates are going to go buttery smooth and new car purchasers won't have a choice in how their vehicle is propelled.  Amusingly double dipping internal combustion owners with the gas tax stacked on top of a mileage tax probably would be a deterrent unto itself.   

[Scott5114]

To some degree, it shouldn't make a difference to most people if their car is powered by an ICE or electric motor. Right now, for my job, I drive all over the Oklahoma City metro (I'm basically a temp and I go where my boss has work for me). Even so, the furthest-out place I've been to (Logan County, yikes!) is still near enough to me that I could go there and back on one charge with current technology. It's no different than how most people treat their phones–charge up at night, and that charge carries me all day until I get home and charge it again.

As roadgeeks, we tend to get into this mindset of what works best for long trips since that's a thing many of us enjoy, but it's easy to forget that isn't the use case for cars for most of the population. Obviously there are some people where EV technology isn't quite there for their use case (people that commute multiple hours each way for instance, or people that live in a home with no garage that they could install an EV charger in) but the vast majority of people would be well-served by an EV.

Even as a roadgeek, I would buy an EV today if I had the money to do so. If I need to go on a longer trip, I can always rent an ICE car.

[Max Rockatansky]

Divorcing the Road Geek stuff for the moment and looking at my present situation an EV still isn't very viable.  I have a 38 mile rural one-way drive to my home office everyday and there are times I'm recalled in an emergency overnight.  Unless I want to spend some serious money on a higher end current EV there isn't much the segment offers me right now in terms of a reliable range that I need.  I can't plug in at work and I would need start charging right away the second I got home.   It's just way easier to buy some entry level ICE car and run into the ground over 5-7 years. . 

Granted, that's just my own situation and perspective.  Suffice to say the way I live, work and commute does not fall within the conventional norms.

[Scott5114]

Right, yeah, if you have a schedule where you're working random start and end times, or if you can't otherwise guarantee a certain amount of off time between drives, EVs aren't going to be quite there for you just yet. But it may work for your typical driver that works an 8 to 5 shift, Monday to Friday, fifteen miles away. Or if you have an employer that provides EV chargers as an employee amenity.

Also, I would imagine most drivers would start charging right away when they got home. That's what I'd do–turn off car, get out, charge, go in the house, forget about the car until the next morning, and wake up to a full charge.

[Max Rockatansky]

I should note that I would definitely consider an EV if there was one out there that fits my needs and was in a down market price range.  I think by 2030 there will be some options available like that which is likely when I'll make a switch with my daily driver.  I am kind of hoping things like a mileage tax don't become a reality until around that time also given I'll be right on top of a fully vested twenty year retirement and paying off the house.  I probably wouldn't "retire"  but I could see myself getting a wind down job close to home. 

[Dirt Roads]

Divorcing the Road Geek stuff for the moment and looking at my present situation an EV still isn't very viable.  I have a 38 mile rural one-way drive to my home office everyday and there are times I'm recalled in an emergency overnight.  Unless I want to spend some serious money on a higher end current EV there isn't much the segment offers me right now in terms of a reliable range that I need.  I can't plug in at work and I would need start charging right away the second I got home.   It's just way easier to buy some entry level ICE car and run into the ground over 5-7 years. . 

Granted, that's just my own situation and perspective.  Suffice to say the way I live, work and commute does not fall within the conventional norms.

I've been watching the industry carefully, because I am interested in a hybrid vehicle that permits recharging and allows the driver to disconnect the combustion engine until the battery bank is nearly depleted.  I'm also interested in customizing such a vehicle to have a 240VAC inverter.  I was shocked (pun intended) when the early prototype of the Ford Lightning F-150 actually has a 240VAC inverter, but I seriously doubt this feature will make it into production.  Anyhow, in a wooded area where lengthy power outages happen several time a year (we were just out during the storm 9 days ago), a vehicle that could also be a power source during an emergency would justify the additional cost.  And I would prefer diesel (good luck on that one).