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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: Heavier vehicles...
By FITCamaro on 12/31/2008 3:40:06 PM , Rating: 1
What are you rambling on about?

Taxes on gas pay for roads. You say that those taxes are fair because larger vehicles have a bigger impact on the roads (which I'm not disputing) and they use more gas so they're pay more for the roads. But if a smaller vehicle gets lower mileage than a larger vehicle, it is paying a higher fee for road usage while impacting the roads less than a larger vehicle.

RE: Heavier vehicles...
By Yawgm0th on 12/31/2008 4:37:23 PM , Rating: 2
I did say something erroneous in my post, I will concede.
Taxing gas is the only way to distribute responsibility fairly amongst drivers.

This is wrong since distributing responsibility fairly is impossible. Let me rephrase.
Taxing gas is the only reasonable way to distribute responsibility somewhat fairly amongst drivers.

I apologize if I misunderstood your disagreement. In any case, there's no such thing as fair taxation, but some taxation isn't as unfair as other taxation. It's true that owners of less fuel-efficient cars pay a disproportionate amount of transportation gas tax funding since weight is not the only factor of fuel efficiency. I do not dispute this.

However, it is still more fair this way than charging by mileage, as that would reverse the situation and the disproportion of the funding would be to an even greater degree. Light cars with inferior fuel economy than significantly heavier cars are relatively few. Overall, there is a very strong correlation between fuel efficiency and weight. Certainly there are some outliers and hybrid engines change things, but for the most part gas tax makes vehicle owners pay a somewhat proportionate amount.

Hybrid vehicles will change this, but not as much since larger hybrid still have a larger disincentive than smaller hybrids. However, plug-in hybrid and electric vehicles will certainly warrant a paradigm change. GPS mileage tracking won't be a reasonable solution.

Until plug-ins become common, gas tax is probably the most fair, most easily implemented transportation funding tax.

RE: Heavier vehicles...
By Alexstarfire on 1/1/2009 5:14:04 AM , Rating: 2
While technically true I really doubt ANY car, including the H1 Hummer gets worse mileage than a fully loaded semi-truck. That'd be near impossible. All this tax is going to do for the people of Oregon is make those with semi-trucks and other such vehicles that are heavy and get bad MPG pay less while those with lighter and more fuel-efficient vehicles pay more.

I fail to see how that is even remotely more fair than the way it is in every other state. Honestly, it's overly complicated, no more fair than the current system (if not less fair), and has security risks. What the hell is the upside to this for either side?

BTW, does this mileage only count for miles driven in Oregon or just vehicles licensed in Oregon? I would think that to be most fair it's be Oregon licensed vehicles with miles driven in Oregon..... but I really doubt that's the way it'll be.

RE: Heavier vehicles...
By CloudFire on 1/1/2009 8:00:41 AM , Rating: 2
Do you honestly think your argument is sound? While i don't dispute the fact that some percentage of small vehicles can get worst mileage, the MAJORITY of small vehicles get better gas mileage than bigger vehicles. That's just common sense. You are arguing for the other side which makes agreeing with it a lot harder. A person driving a Civic or Prius will be taxed more because they are getting more mileage with their more fuel efficient car? While some people in a H1 Hummer or Ram truck pays less tax because they are using less miles? Even though they are pumping more gas?

Just give up, this system is not very efficient and is way more unfair than the one already established.

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