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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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By kilkennycat on 12/31/2008 4:41:40 PM , Rating: 2
I live in Oregon and have to continually read about or listen to the governor's hare-brained "green" schemes. Not that I don't believe in conservation intelligently implemented. I own a Toyota Yaris together with its highway (measured) consumption of 43 miles/US gallon and afaik Oregon is also the top state for ownership of hybrids. I have zero intention of participating in this hare-brained scheme and since Oregon uses ballot-box referendums on many issues, you can guarantee a ballot measure on this subject with an appropriate vote by me. The majority of other developed country in the world uses gas taxes and vehicles taxes ( the latter graduated according to engine capacity or total emissions) in a dual function of controlling consumption and as a prime revenue generator for their General Fund. This use of gas and vehicle taxes grows out of the fact that most developed countries have been net importers of oil products for ever and their economic health has been critically dependent on tight control of oil consumption and the promotion of public transport. The US is a net importer of oil only because of its profligate use of that precious resource over the last 50 years.




By bigbrent88 on 12/31/2008 4:58:30 PM , Rating: 2
What happens when you need to fill up a gas can for lawn equipement, you pay that gas tax? Using this system your lawn mower isn't paying state taxes! Just trying to look on the bright side.


By MadMan007 on 12/31/2008 7:04:32 PM , Rating: 2
I can see it now, everyone will be driving lawn mowers for their around town errands. Beautiful.


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