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A new mileage tax may replace the gas tax in Oregon. Oregon residents will be taxed by the number of miles travelled, as they travel along the state's highways like Highway 30 pictured here. Those not participating will face higher taxes at the pump.  (Source: Lyn Topinka)
A new ambitious high-tech effort to fairly distribute roadwork taxes proposed in Oregon, but can it overcome fears of government tracking?

Nobody likes to pay taxes, but they are reality of modern U.S. government as we know it.  However, if you have to pay taxes, you at least want them to be fair.  That's the mentality driving a rather revolutionary, albeit controversial, new plan in the state of Oregon.

In Oregon, as in other states, people have long complained about using fuel taxes to finance road work.  Such measures place a larger tax burden on those in professions requiring heavier vehicles.  So Oregon's Gov. Ted Kulongoski (D) has developed a new plan -- pay by mileage.

Oregon, whose highways recently gained attention via a new solar project, is now looking to legislate the governor's plan.  The new legislation will provide Oregon with "a path to transition away from the gas tax as the central funding source for transportation" via a mileage tax implemented with the help of GPS satellites.

While the exact details are still being ironed out, Gov. Kulongoski's web page gives the basics of the plan.  In it he states, "As Oregonians drive less and demand more fuel-efficient vehicles, it is increasingly important that the state find a new way, other than the gas tax, to finance our transportation system."

He is creating a task force "to partner with auto manufacturers to refine technology that would enable Oregonians to pay for the transportation system based on how many miles they drive."  Key studies were performed in 2006 and 2007 that indicate that such a program would indeed be possible. 

In the 2007 test which lasted 10 months with 300 motorists at two service stations, drivers were taxed 1.2 cents per mile and were refunded the 24 cents a gallon state gas tax.  When the motorists got to the pump, their vehicles connected to government computers informing them of the mileage (calculated via GPS tracking) and issuing tax.  Equipment for the test came from Oregon State University.

While clever, the program faces one enormous thorny obstacle -- concerns over the loss of privacy. 

The governor's online outline states, "The governor is committed to ensuring that rural Oregon is not adversely affected and that privacy concerns are addressed."

Despite assurances from James Whitty, the ODOT official in charge of the project, that the new GPS system would not be used for continuous tracking of citizens' cars, many advocacy groups are outraged and many remain fearful.  The final report on the 2007 test deployment was conscious of this fear, stating, "The concept requires no transmission of vehicle travel locations, either in real time or of travel history.  Accordingly, no travel location points are stored within the vehicle or transmitted elsewhere. Thus there can be no ‘tracking’ of vehicle movements."

Advocates point out that the devices are not developed by Oregon, but rather by industry partners.  The program's policy page states, "ODOT would have no involvement in developing the on-vehicle devices, installing them in vehicles, maintaining them or having any other access to them except, perhaps, in situations involving tampering or similar fee evasion activities."

However, even if privacy concerns can be laid to rest, there will also be a large price tag associated with initially implementing the program, one which may give residents sticker shock.  An initial investment of $20M USD would be needed, according to the governor, just to see if the program was viable.  A full deployment would require GPS be gradually added to gas stations and to all vehicles in the state.

The proposal also calls for a punitive tax against those not adopting the new device -- the gas tax will continue for vehicles not equipped to pay the mileage tax, but it will be increased 2 cents.

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RE: why?
By mdogs444 on 12/31/2008 12:40:21 PM , Rating: 2
That could not work in the slightest either - as the method of subtracting last years usage, as well as the GPS solution both charge you for a major item that you shouldn't be charged for.

Lets look at some examples here. Say you have a long drive way, or you live on a farm and use your truck to drive all over your own land. What about if you live in a condominium or apartment or private drive subdivision? Those roads are private and paid for by your yearly/monthly assessment fees. But you'll still be charge mileage for driving on them?

This whole thing is stupid. Just another way to tax the people, instead of the state/local governments learning to cut back on spending and conserve, just like the regular people need to do when they have a money shortage. We don't get to go to work and demand a pay increase because we cannot manage our own finances appropriately.

Tax & Spend liberals...this is what they are all about.

RE: why?
By FITCamaro on 12/31/2008 12:47:54 PM , Rating: 2
Good point on private roads. Didn't think about that. If they're gonna do it was just thinking the odometer would be easier. It being based off GPS is still going to tax them on private roads though.

Honestly I'm not sure what to make of an idea of taxing based on mileage instead of a flat gas tax. On one side gas is cheaper. But then you've got another tax to pay separately. If they equal out the same, I guess the question is whats the point. But the fact that they're looking at this, they think they'll make more money off it.

And we hardly need to give government's more money to waste.

RE: why?
By Reclaimer77 on 12/31/2008 1:01:46 PM , Rating: 2
This idea is insanity incarnated. When are people going to take a stand ?

The people of Oregon should burn their state to the GROUND before something like this is even considered !

RE: why?
By ZmaxDP on 12/31/2008 1:18:46 PM , Rating: 4
Yeah! Scorched Earth!

Actually, they would probably use gasoline to start/fuel the fire. So, technically, they should wait till after the law is passed as their arson will be approximately 24 or 26 cents cheaper per gallon. They aren't driving with it, so they won't pay taxes on it at all!

RE: why?
By MadMan007 on 12/31/2008 6:49:31 PM , Rating: 2
Tax & Spend liberal or Deficit & Spend Neocon. They both suck.

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