Pay As You Drive: More States Explore Mileage Tax

Building and maintaining roads is always a thorny issue, when it comes to how to pay for it. The most common way is through gasoline taxes, which are unpopular and often diverted to non-transportation items. In Texas, we have the never-ending debate about toll roads and whether they are necessary, or just another government money grab. Now, some states are experimenting with another way of funding roads and transportation projects---a road-user fee, often called a vehicle miles-traveled or VMT tax.

So far, only Oregon and Utah have implemented a VMT, and only on a voluntary basis. But at least a dozen other states are considering the idea, and it has garnered both support and criticism from across political lines. Randal O'Toole, transportation issues expert and senior fellow at the CATO Institute, is intrigued by the idea. "I'm in favor of abolishing the gas tax and replacing it with mileage-based user fees," he tells KTRH.

O'Toole tells KTRH a VMT would be far less regressive than the gas tax, or other taxes which are often used for local road projects. "I would like to see city and county roads paid for out of mileage-based user fees, rather than having them spend property tax money or other money for roads," he says.

One of the biggest criticisms of a VMT is the potential privacy violations, over how people's driving would be monitored. O'Toole suggests states contract with private companies to administer the program, so driver data would only be visible to one private entity, rather than any government body.

So far, the idea of a VMT is in its infancy. But with the increasing number of non-gasoline cars on the road, and the unlikelihood of raising or reforming the federal gas tax, O'Toole believes it could emerge as a legitimate alternative. "You're going to end up paying a little more in mileage-based user fees, but you'll end up paying less property taxes or other kinds of taxes to pay for city and county roads," he says. "In the end it will be a net wash, but it will be much more fair, because you'll actually pay for what you use, and you won't have to pay for what somebody else uses."

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