Delaware Runs Mileage Tax Pilot Program

The most pressing part of the pilot will be in figuring out how to charge drivers based on their mileage. This could be done through a flat fee or by tracking the number of miles driven each year.

by Jeff Brown, Dover Post, Del. / September 8, 2016 0

(TNS) -- At least 50 Delawareans soon will be testing a pilot program that eventually could replace the state’s gasoline tax.

The program is part of a multi-state effort funded by a $1.49 million matching grant provided by the U.S. Department of Transportation. Delaware is to receive $290,000, which it will match with administrative funds from within DelDOT, said state Secretary of Transportation Jennifer Cohan.

Cohan is chair of the I-95 Corridor Coalition, an interstate group of experts from Maine to Florida charged with resolving transportation issues. The coalition will be looking at using those resources to keep Delaware’s transportation trust fund solvent.

“This is a pilot program to determine the feasibility of a mileage-based user fee to replace the gas tax,” Cohan said. “This would not be in addition to the gas tax, but to replace it.”

Other grant recipients include Pennsylvania, New Hampshire, Connecticut and Vermont, although only Pennsylvania and Delaware are looking at the user fee idea.

Alternative Fueled by Better Cars

Delaware’s transportation trust fund is buoyed in part by the state’s 23-cent per gallon fuel tax; Gov. Jack Markell, in his two most recent budget proposals, urged lawmakers to raise the tax by at least 10 cents per gallon.

Markell argued the gas tax has remained the same since 1995 and increasingly fuel efficient vehicles over those two decades have meant a net decrease in revenue from the tax. Legislators, however, barely considered the idea.

Instead, in 2015 the trust fund was recharged by borrowing and with increases in permit fees and road tolls that bankrolled the transportation capital plan through 2021.

But it became clear the time was ripe to consider an alternative to the gas tax, Cohan said.

“We’re trying to look for a sustainable source of revenue so we don’t have to fight for a revenue package every 10 years,” she said. “It gets politicized, and we don’t want that, either.”

The most pressing part of the study will be in figuring out how to charge drivers based on their mileage. This could be done through a flat fee or by tracking the number of miles driven each year.

The technology to do the latter already exists in newer cars: onboard computers provide reams of diagnostic information and could provide mileage data on which the fee could be based. Miles driven also could be tracked, particularly in older cars, by recording the odometer readouts during motor vehicle inspections, a requirement whenever vehicles are relicensed.

Additional details, such as how and when drivers would be billed or issued rebates, or what would happen if someone cannot pay the user fee, will have to be worked out during the pilot program, Cohan said.

One more issue – driver privacy – also must be addressed, she said. Some, including state Sen. Colin Bonini, are not comfortable thinking the state could track their movements while behind the wheel.

Cohan agrees, adding that the U.S. Department of Transportation money should help address that issue.

“That’s the beauty of getting this grant and exploring these different options,” Cohan said.

Out West, it’s OReGO

The state of Oregon already has put the mileage-based user fee into practice.

Although designed for about 5,000 volunteers in its initial phase, the system currently is in use by about 1,200 drivers, Michelle Godfrey, spokeswoman for the Oregon Department of Transportation said.

“This is an alternative funding solution because vehicles are more and more fuel efficient and they’re using less gas,” she said. “There’s less to contribute to road maintenance.”

Members of the Oregon legislature recognized the problem as far back as 2001, and authorized pilot programs in 2006 and 2012. The user fee system, called OReGO, went into effect in July 2015.

Volunteers with the program are given a recorder that plugs in to the car’s diagnostic system; the device records only miles driven and fuel used, although an optional device for commercial drivers also provides GPS data.

The user fee is calculated and compared to the tax the driver paid when gassing up.

“If they paid more in gas tax at the pump, they get a credit refund,” Godfrey said. “If not, they pay the difference.”

Even though the state hasn’t signed up the number of volunteers it would like to see, Godfrey said Oregon officials are pleased with how the system is working.

“We haven’t had any major glitches,” she said. “We’re excited about the prospects for it.”

The program has drawn interest from other states, including Delaware, Godfrey said.

“We share with other states,” she said. “We want to collaborate with everyone and learn from our program.”

Legislation Eventually Needed

Cohan doesn’t see Delaware politics as getting in the way of this initial program, despite the end of Markell’s final term in January. The pilot effort should continue no matter who occupies the governor’s office.

“One of the great things about Gov. Markell is that he fully supports planning for the future and the importance of infrastructure to our economy,” she said. “He’s been very supportive.”

For its part, DelDOT will be starting its pilot program in October with a concerted effort to educate the public beginning in December. Testing for the user-based system will begin in February and run through March 2018, with a final report then due to the Federal Highway Administration. Additional testing and more funding could come after then, Cohan said.

Finally, legislation from the General Assembly would be required to implement any new proposal to replace the gas tax, she said.

©2016 Dover Post, Del. Distributed by Tribune Content Agency, LLC.