US, California exploring vehicle-miles-traveled 'user fee’ to replace gas tax

Employees may have another reason to push for remote work.

Federal and state governments are taking a serious look at moving away from a tax per gallon method of paying for road repairs in favor of motorists paying by the mile.

The former would place much of the cost burden on long- distance-driving commuters or super commuters who by definition drive 30 to 90 miles each way.

The proposal is in the $1.2 trillion, 2,700-page Infrastructure Bill that passed in the U.S. Senate last month. It calls for a pilot program tracking participants’ driving distances through GPS-style devices that plug into vehicle ports. The funding mechanism, which remains up in the air, would replace the gas tax all states access to pay for road fixes.

Transportation insiders claim that goals to put more electric vehicles on the road reduces the amount of gas tax the government can collect to make the repairs. On Feb. 8, the Journal report the U.S. Department of Energy established a goal to put 15 million electric vehicles on the road by 2030.

“I think funding the highway system by user fee is a really good idea. Gas taxes don’t work anymore. We need to implement a user fee, not pay for a bridge to nowhere,” said Randal O’Toole, a public policy analyst with the Cato Institute, a U.S. think tank.

O’Toole thinks some of the components of the gas tax to survive but expects a new reiteration to include a plug-in port that tracks vehicle miles as a more accurate method of paying for road maintenance.

Vehicles newer than 1986 come equipped with a diagnostic port that insurance companies have used to implement discounts on policies.

“Super commuters” would find themselves footing much of the bill. They number more than 4.5 million, according to the latest U.S. Census estimates from the 2019 demographics studies. In the San Francisco Bay Area, 60% of super commuters live within a 30- to 90-mile zone, consisting of Stockton, Modesto and Santa Rosa regions, the Cato Institute reported.

The idea of a VMT-based program replacing excise or gas taxes to pay for road repairs has been long in coming for a highway system built in 1956 — one that’s viewed as crumbling through the years.

“This is something seized upon by a lot of people as the next big thing for a long time now,” said John Goodwin, spokesman for Metropolitan Transportation Commission, the transportation planning, financing and coordinating agency for nine Bay Area counties.

“The fact is, the excise tax has worked well, but it’s not perfect. As we move away from the combustible engine, an alternative to this excise tax carries more weight,” he said. “But it needs to be simple, fair and understandable — not burdensome.”

The notion of how the proposal will stand centers on the U.S. government chipping in for roads out of per-mile fees and placing those funds in California’s new program. Existing tolls would be folded into the per-mile fee system.

While the state would manage its per-user-mile program, those funds would get passed down to U.S. highways, state routes as well as city and county roads. Local governments collectively spent $46 billion on subsidizing roads in 2019, according to the Cato Institute study.

As of Aug. 24, California motorists pay 43.7 cents per gallon on gasoline taxes; 36 cents on diesel.

Exploring the state of a motoring California

Caltrans is conducting a series of user-fee based studies to monitor the number of miles motorists are driving in the state.

“We’ve relied upon a gas tax for 100 years for road maintenance. As cars have become more fuel efficient and with the sales of more electric vehicles, the long-term gas tax isn’t going to work for us anymore,” Caltrans Road Charge Program Manager Lauren Prehoda told the Business Journal.

The transportation official expects a third-party agency to oversee the program.

The proposal becomes trickier when certain groups pay more than others — especially when they involve the low-income.

“That’s what Caltrans will look at in its research,” she said.

Prehoda is convinced the workplace will appear much different as employees continue their jobs in a remote work setting.

“We already know remote work has some good outcomes like air quality. And now there will be less wear on the roads,” she said.

Much of the effort in evaluating the change in road funding stems from California Senate Bill 1077 authored in 2014 by then Sen. Mark DeSaulnier, D-Concord. The lawmaker, who now serves in the U.S. Congress, directed in his bill for the California Transportation Commission to create a road-charge program to find an alternative to the gas tax for the state’s 34 million registered vehicles.

“How (the alternative) impacts certain communities like the disadvantaged driving different types of vehicles is what it all comes down to,” Prehoda said.

Susan Wood covers law, cannabis, production, biotech, energy, transportation, agriculture as well as banking and finance. For 25 years, Susan has worked for a variety of publications including the North County Times, now a part of the Union Tribune in San Diego County, along with the Tahoe Daily Tribune and Lake Tahoe News. She graduated from Fullerton College. Reach her at 530-545-8662 or

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