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July 16, 2014
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New Report Describes Oregon Experience with Road Usage Fees

As vehicle fuel economy rises, transportation agencies will continue to experience reductions in motor fuel tax revenue.  Many states are examining replacements to the motor fuel tax (MFT), such as vehicle miles traveled fees, sales taxes on motor fuel, tolling, and other innovative solutions.  In 2013 Oregon enacted the nation's first road usage fee, following the completion of a pilot program.  Oregon Senate Bill 810 creates a voluntary program to be deployed in 2015, capped at 5,000 vehicles, which allows motorist to pay a per-mile road charge of 1.5 cents per mile in lieu of the state MFT (currently 30 cents per gallon).  
 
In early 2014 the Oregon Department of Transportation (ODOT) issued a report on its Road Usage Charge Pilot Program, as well as its plans to implement the voluntary program in 2015.  Between 2012-13, 88 drivers participated.  To address privacy concerns and provide flexibility to participants, drivers were offered multiple options to report mileage data, including both GPS and non-GPS technologies. Drivers were also able to choose whether the administration was done by a private firm or ODOT.  The majority of participants used location-determination technology that reported mileage on Oregon public roads to a private vendor, who then sent the revenue collected to the state. 
 
The report indicated that participant satisfaction improved over the course of the pilot program and that four key system performance goals were met:  ease of use, motorist choice, an open technological system, and private sector administration.  Under the pilot program, the per-mile charges resulted in 28 percent more revenue than would have been collected under the state MFT.  
 
CMAP is also examining ways to ensure the viability of transportation funding within the State of Illinois.  As a short-term solution, the draft GO TO 2040 update recommends increasing the Illinois MFT by 8 cents per gallon and indexing the rate to inflation, but it calls for replacing the MFT in the long term with a sustainable source of revenue to support the region's transportation system.
 

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