Mileage fee is fairest way to pay for America’s roads | Baruch Feigenbaum:

Drivers bought fuel, paid the per-gallon tax, and the money was supposed to go toward maintaining and improving roads and highways. The more drivers drove on the roads, the more they paid. It largely worked for decades.

But the federal fuel tax hasn’t increased since 1993. Thirty years of inflation have significantly eroded its purchasing power. Lawmakers could have indexed gas taxes to inflation. They could have charged electric vehicles a fee equivalent to the taxes they’d pay to use roads. They could have prevented the siphoning of gas tax revenue from roads to pay for walking trails, parks, transit and economic development projects. That might have allowed the gas tax to survive longer.

Those fixes are unrealistic today, given Washington's political dysfunction and out-of-control federal spending.

As a result, the gas tax is like an aging rock star on a farewell tour. It is still around, but with the growing number of electric, hybrid and fuel-efficient vehicles, it is quickly becoming less effective and outdated. Some hybrid cars now get more than 50 miles per gallon, and electric vehicles don’t pay fuel taxes even though they cause similar wear and tear as gas-powered vehicles.

America’s roads need a dedicated, reliable revenue stream to repair and modernize. Reason Foundation's Annual Highway Report recently found that more than 42,000 bridges are structurally deficient. A dozen states have more than 5% of their urban highway pavement in poor condition. Thirty-one states have rural traffic fatality rates of more than one death for every 100 million miles driven.

These issues must be improved. The gas tax, increasingly unsustainable as a funding source, worsens the nation’s infrastructure problems.

Some are calling for an annual vehicle weight fee, but that wouldn’t reflect actual road use. A weight fee also would allow large trucks to pay less than their fair share because they place the most stress on the road system.

The best path forward is to replace fuel taxes with a mileage-based user fee. Two prominent national infrastructure commissions studied more than 25 funding methods, and both recommended a mileage fee. Four states — Utah, Virginia, Oregon and Hawaii — already have mileage fees, and 30 states have tested them.

Critics of mileage fees worry about privacy, fairness for rural areas and the costs of collection.

All current mileage-fee programs offer a GPS option that records drivers’ positions in real time to charge them. To protect people's privacy, states block access to the location data, delete it after specific time periods, and use private vendors to protect customer data from government overreach.

The programs also offer lower-tech options that do not include location data, such as a yearly manual odometer-reading option that logs miles and bills accordingly.

In terms of costs, research finds that most rural drivers would pay less under a mileage fee than if the gas tax is increased. This is because rural residents tend to drive more trucks and other less fuel-efficient vehicles. Rural drivers would pay more if Congress raised the fuel tax to today’s inflation-adjusted levels, or if it imposed a vehicle weight fee that covers the full cost of maintaining roads.

Mileage fees are more expensive to collect than the gas tax. But as these programs scale up and technology is implemented, the cost of collection should decrease.

For decades, the gas tax was a logical way to connect driving and road funding. But it’s time to modernize how drivers are charged to ensure users adequately fund the nation’s bridges, roads and highways.