Preparing for a per-mile driving tax

The way we fund transit in this country is fascinating. We tax people for the amount of gasoline they burn driving, and then we take that money and spend it all on monstrous billion-dollar road projects so people can spend more money on gas so we can spend more money on billion-dollar road projects.

People think that building mass-transit systems is expensive, but that's because they don't separate the cost of gasoline from the cost of gas taxes. Those taxes, as high as 60 cents a gallon (and as low as 31 cents), add up to a huge burden on consumers. And a burden that only goes to feed our addiction to the automobile.

The University of Iowa, however, wants to separate the funding of highways from the price of gasoline and, instead, charge people per mile they drive.

As part of a $16.5 million study, 450 North Carolina drivers will be the first to test out a new system of driver taxation – one that collects road usage fees not through gasoline purchases, but by where and how many miles drivers actually drive. The University of Iowa plans to recruit 2,700 volunteers in six states to test the system out over the next two years.

Volunteers will have their cars fitted with the experimental GPS computer system, which will track distance driven through each state or jurisdiction, and the vehicle will be charged with the appropriate per-mile fee. Drivers will receive a monthly bill for their road usage as calculated by the onboard computer.

This road usage fee system allows states and jurisdictions to assign distinct per-mile fees to different vehicle classes, if they choose.

Theoretically, they could also charge people extra for speeding or driving in high-traffic areas. And, in the future, drivers could be notified that certain areas were high tax areas, and even suggest possible alternatives, like park and ride mass-transit. It could be a tax solution that actually slows, instead of accelerates, our addiction to oil, and that could be very good news.

Via: News Observer and the University of Iowa