VMT Discussion

[mightyace]

This thread is for a general discussion on Vehicle Mileage Tax (or Road Use Charge).  In essence this is charging a tax (fee) for each mile you drive.

There was an interesting discussion awhile back on this issues with regards to a proposal in Oregon as that proposal would use GPS devices to track movement.

This concept has crept into the news this year but there has yet been no formal proposals for such a tax on the federal level.

[mightyace]

According to TollRoadNews, engineers at the University of Minnesota have come up with a method that would use the OBD II connector in all vehicles manufactured since 1996.

Existing vehicle data bus, cellphone SMS proposed for nearterm VMT charge

In short, this proposal would read the data from the vehicle's computer and send the data via cell phone data links.  They claim it would retain the anonymity of location that GPS proposals lack and would work better in urban areas.

I have a few questions on this:

1) While cell phone technology may work better than GPS in urban areas, operation may become problematical in rural areas where cell phone, at least 3G data capable coverage, is minimal to non-existent.  What would you do there?

2) Since cell phones can track your location, what is to prevent a locator to be placed in the proposed device?  And even if not, a fuzzier picture can still be obtained by citing which cell tower the data is received on.  So, is privacy really much better?

3) What would be done with vehicles that do not have the OBD-II connector?  My vehicles are all too old to have that technology.

[Chris]

This has been planned since the early 1990's in the Netherlands. It hasn't been implemented so far luckily, I'm firmly against it, because it allows to price people off the roads. As some of you might know, we haven't had a decent infrastructure expansion in the last 30 years, while the population continued to grow, which resulted in Los Angeles-like congestion. The GPS based mileage tax is a perfect instrument to increase tolls during rushhours, trying to reduce congestion.

The problem is they're saying it won't be more expensive, but exact mileage prices haven't been revealed yet, making it hard to make an accurate estimate of the cost for individuals. Another problem are the very high operating costs of such a system, I really don't believe it will be cheaper or equally expensive.

[J N Winkler]

As far as I am aware, the Oregon system doesn't actually use GPS charging.  In fact, that is touted as one of its main advantages.  It relies on roadside receivers which communicate with a transmitter onboard the vehicle to apply a use charge on a point basis.  This allows greater charging in densely populated areas like Portland where traffic congestion is likely to be worse and infrastructure funding needs are more urgent, without putting the state in the position of continuously surveilling drivers.

[J N Winkler]

Yes, it is, except that the system incorporates the technical possibility of collecting during refueling instead of through billing.  This is done by having the roadside sensors add a given charging increment (which can vary according to location and, theoretically, volume-to-capacity ratio) to the on-board transponder, which is then downloaded at the pump.  If the pump senses that your car has a transponder, the motor fuel tax is removed and the mileage charge is substituted.  If you do not have a transponder (e.g. if Oregon decides to "go it alone" and Oregon-registered vehicles have to have transponders while out-of-state vehicles don't), the amount you pay is basically the wholesale price plus a traditional excise tax set high enough to make it politically palatable for everyone registered in Oregon to have transponders.  It's win-win all the way:  (1) Oregon gets to keep on sticking it to everyone else (which has been the Oregon way since Tom McCall was governor), (2) it is a backdoor way of raising the gasoline tax, (3) the lack of a real-time localization element gets around most of the surveillance and privacy arguments, and (4) pay-at-the-pump keeps the cost in manageable chunks for the paycheck-to-paycheck folk, thus guaranteeing there aren't big bills they struggle to pay and that they don't drive more than they can afford to pay.

[Sykotyk]

Call me crazy, but isn't this already covered when fuel taxes?

Or, are the legislators too afraid to simply raise the taxes for fear of a backlash? Or, is this a covert way so that SUVs don't get stuck paying more for their behemoths since their MPG will be less?

Sykotyk

[mightyace]

Call me crazy, but isn't this already covered when fuel taxes?

Or, are the legislators too afraid to simply raise the taxes for fear of a backlash? Or, is this a covert way so that SUVs don't get stuck paying more for their behemoths since their MPG will be less?

Sykotyk

Yes to all of the above. 

[J N Winkler]

Call me crazy, but isn't this already covered by fuel taxes?

For the time being it is, but a different charging method will be necessary if, at some point in the future, large numbers of cars are not running on liquid fuel.  The key goal is to preserve the principle of charging according to use.

Or, are the legislators too afraid to simply raise the taxes for fear of a backlash?

It varies from state to state.

Or, is this a covert way so that SUVs don't get stuck paying more for their behemoths since their MPG will be less?

It doesn't necessarily have to be since the transponder can be calibrated to take into account vehicle size class.

The key point here is that the Oregon scheme is not yet in use.  Oregon DOT has merely carried out (successful) proof-of-concept testing.  I believe it has the potential to be an excellent alternative to GPS charging (I don't want to live in a police state!), but personally I think excise taxes on liquid fuels are good to go for at least another 20 or 30 years.

It is now 44 years since R.J. Smeed proposed a road pricing method in his seminal 1965 paper on the subject, and the gas tax is still the financial mainstay of road maintenance and construction.

[agentsteel53]

the principle of charging according to use.

since fuel consumption is approximately proportional to road wear and tear, I think the gas tax does an adequate job of meeting that principle. 

This without the dangerous precedent of tracking road users.  The best way to make sure something won't be done is to make sure something can't be done.  Making sure transponder data is used responsibly is a solution.  Making sure transponders aren't installed on my car is a better one.

[Revive 755]

I'm mixed on the issue.  On one hand the gas tax will not work when gas stays above $4/gal and everyone starts switching to alternate energy vehicles.  On the other sometimes I like to take a longer route if the scenery is better or it bypasses an unpleasant area/section of road.  Depending upon the rate, I could see tourism possibly going down also.  Then I have to wonder about other potential revenue sources, such as increased licensing fees or housing/commercial development impact fees for those sprawling metro areas.

But I still have doubts about gas tax revenue being down given the numbers of low-mileage vehicles I see every day; to me it seems that it is more of an issue of inflation of construction and ROW costs, plus the costs of just starting major projects due to several years of study and time lost in the courts.  If someone wants to post statistics and prove me wrong, feel free.

[Duke87]

The best way to make sure something won't be done is to make sure something can't be done.  Making sure transponder data is used responsibly is a solution.  Making sure transponders aren't installed on my car is a better one.

True.

So.... just use the odometer that all cars already have. No GPS tracking necessary.

[mightyace]

The best way to make sure something won't be done is to make sure something can't be done.  Making sure transponder data is used responsibly is a solution.  Making sure transponders aren't installed on my car is a better one.

True.

So.... just use the odometer that all cars already have. No GPS tracking necessary.

That's my thought and there are already laws on the books in most state about altering the odometer.

[agentsteel53]

$4/gal will not cause people to switch over.  $10/gal, maybe.  $20/gal is the true threshold, at which people throw out their SUVs.  Remember, my dad's '83 civic got 51 miles per gallon.  As far as I know, no modern car is EPA rated for that amount - neither city nor highway.  

when gas gets to $20/gal, people will find what was good about that '83 Civic, add 30 years of technology to *that*, and finally get rid of the moronmobiles that they plague the roads with at this time.

[J N Winkler]

$4/gal will not cause people to switch over.  $10/gal, maybe.  $20/gal is the true threshold, at which people throw out their SUVs.  Remember, my dad's '83 civic got 51 miles per gallon.  As far as I know, no modern car is EPA rated for that amount - neither city nor highway.

Are you sure the 1983 Civic was EPA-rated for 50+ MPG?  In my experience these ratings are often pessimistic--I owned (for 10 years) a 1986 Nissan Maxima which Consumer Reports considered a bit of a gas guzzler at the time it was made (they measured fuel economy at about 22 MPG overall), but I could usually count on 30 MPG or better on the open road (up to 34 MPG in high mountainous terrain).

Keep in mind also that if the 1983 Civic relied on CVCC technology, NOx limits might prevent the same technology from being resurrected, or from producing the same level of efficiency in a modern production vehicle.

Re. other posts:  yes, odometer billing is a conceptual possibility, but laws against odometer fraud won't by themselves necessarily prevent said fraud, and unless there is a mechanism for incremental payment, the difficulties both of collection and fraud prevention are likely to be immense.  In any charging method the costs of collection and enforcement have to be taken into account and, by this measure, the gas tax is far better than even the current generation of electronic tolling.  We don't want to get rid of the gas tax in favor of a police-state surveillance system, but we also don't want to wind up in a situation where we have to pay an increased amount and the entire amount of the increase goes to collecting the payments.

[agentsteel53]

I have no idea what it was rated.  He drove it about 90% highway, and got 51 regularly.  53 on occasion. 

[Chris]

$4/gal will not cause people to switch over.  $10/gal, maybe.  $20/gal is the true threshold, at which people throw out their SUVs.  

True, gas hit $ 10 in the Netherlands a year ago, and nobody drove less... They only purchased more fuel-economic cars, but if you don't drive, you got no income.

And that's exactly why a VMT isn't gonna work in reducing traffic congestion in the long term. You price those off the road who have low incomes, but people just gotta go to work generally.

[roadfro]

And that's exactly why a VMT isn't gonna work in reducing traffic congestion in the long term. You price those off the road who have low incomes, but people just gotta go to work generally.

VMT isn't meant to reduce congestion...the purpose is to find an alternative taxing scheme to gas taxes which are declining due to people traveling less and the increase of more fuel efficient vehicles on the roads.

So.... just use the odometer that all cars already have. No GPS tracking necessary.

While a plausible theory, odometer tracking would have its drawbacks.  For example, part of the reasons for using GPS technology in implementing VMT is that it would be able to tell how many miles were driven in certain jurisdictions.  If you were to go on a road trip through a couple states, you'd get taxed for the amount you drove in each state.  Simply tracking the odometer would give all the tax benefit to the registered state of the vehicle.  Probably not a big deal for passenger cars, but much more cumbersome to compute for semis which often don't stick to highways in one state.

[mightyace]

While a plausible theory, odometer tracking would have its drawbacks.  For example, part of the reasons for using GPS technology in implementing VMT is that it would be able to tell how many miles were driven in certain jurisdictions.  If you were to go on a road trip through a couple states, you'd get taxed for the amount you drove in each state.  Simply tracking the odometer would give all the tax benefit to the registered state of the vehicle.  Probably not a big deal for passenger cars, but much more cumbersome to compute for semis which often don't stick to highways in one state.

Well, if it's a National VMT, then that's not an issue and you can make checking the odometer readings part of the border crossing procedure to/from Canada and Mexico.

The main thing most of us who oppose the GPS option dislike is more erosion of privacy and/or potential for abuse.  In the case of Oregon's proposal, they said that the device would only send summary info but without significant technical knowledge and, possibly hardware, how do you verify it?

There was already a case where a rental car company tried to fine a renter for speeding because of GPS info even though he wasn't cited.  The renter took it to court and won, but only because the judge ruled that a private agency cannot unilaterally enforce traffic laws.  But, what's to prevent your local cops, state police/highway patrol from monitoring this info or someone hacking it?

[Chris]

VMT isn't meant to reduce congestion...the purpose is to find an alternative taxing scheme to gas taxes which are declining due to people traveling less and the increase of more fuel efficient vehicles on the roads.

Yeah, but it's ofcourse an easy next step... you don't have to widen roads, just increase the tolls on busy sections.... 

[J N Winkler]

VMT isn't meant to reduce congestion...the purpose is to find an alternative taxing scheme to gas taxes which are declining due to people traveling less and the increase of more fuel efficient vehicles on the roads.

No, no.  In the US those are strictly short-term problems which surfaced in the summer of 2008 as a result of (1) the recession and (2) a sharp spike in crude oil prices.  The decline in vehicle miles travelled was smaller than 10% generally, which means that a gas tax increase of up to 5c in most states would have been sufficient to cover the lost revenue.

The real reasons road pricing (I am not using the acronym VMT for it because that is more commonly used for "vehicle miles travelled") is being pursued at the moment are the following:

*  An alternative to the gas tax will become necessary when a significant proportion of vehicles on the road are not propelled by liquid fuels or other calorific substances which are within easy reach of excise taxation.

*  Taxation by vehicle has been tried, but generally fails because it does not have the granularity to reflect variations in usage.  The administrative costs are enormous, the reliance upon cyclical billing instead of incremental payment incentivizes fraud, etc.  Taxation by odometer has similar problems.

*  Whatever road pricing system is chosen, substantial lead time will be required to design it, test it, install it, troubleshoot it, and make it proof against both fraud and abuses of privacy.

*  With a green-focused Democrat in the White House, there is unlikely to be as good an opportunity to get a road-pricing scheme off the ground.  (Obama has already said he is opposed to road pricing, but his USDOT secretary favors it and I personally don't think the answer will continue to be No later in the current term, or in the next term if he is re-elected.)

I am actually not as worried about the threat to privacy as I am about the possibility that the use of geographically sensitive road pricing will lead to a break in the linkage between road taxation and spending on roads.  This link no longer exists in the majority of European countries (which, BTW, have to face the threat of GPS surveillance).  The current system of linking road-related revenues to road-related expenditures lends a high degree of financial transparency to our system of managing and financing highways.  If a system of road pricing (with a congestion pricing element) were substituted for the current tax structure, which is based largely on excise tax revenues, it would be necessary to increase the charges steeply in order to have a measurable effect on congestion.  This in turn would invite politicians of both sides of the aisle to draw the conclusion that highways are overfunded, conceptualize the congestion charge as a Pigouvian tax, and spend the proceeds on things other than transportation infrastructure.

Easy access to cheap transport is an indispensable attribute of a high standard of living and, on that account alone, I believe governmental attempts to squeeze access to transport have to be resisted if there is no way to prevent their being made in the first place.

While a plausible theory, odometer tracking would have its drawbacks.  For example, part of the reasons for using GPS technology in implementing VMT is that it would be able to tell how many miles were driven in certain jurisdictions.  If you were to go on a road trip through a couple states, you'd get taxed for the amount you drove in each state.  Simply tracking the odometer would give all the tax benefit to the registered state of the vehicle.  Probably not a big deal for passenger cars, but much more cumbersome to compute for semis which often don't stick to highways in one state.

But you don't need GPS tracking to achieve this--this is essentially what the current system of apportionment does.