Comprehensive Roadway Pricing Strategies at Federal and/or State Level

Comprehensive pricing refers to the imposition of direct user fees that apply on all roads and all driving in the form of mileage-based user fees, also known as vehicle miles traveled fees. These charges can either be a flat fee (e.g., a fixed number of cents per mile, regardless of where or when the travel occurred), a variable fee based on user choice considerations such as time of travel, congestion levels on a facility, type of road traveled on, type and weight of the vehicle, and vehicle emission levels, or a combination of these factors.

Pros

•  Could be implemented at national level, as a federal funding source, and could raise significant revenues

•  Revenue stream from VMT pricing highly sustainable since it would not be influenced by increasing vehicle fuel efficiency or use of alternative fuels

•  Like current federal motor fuel tax, proceeds from federal VMT pricing appropriate for dedication to surface transportation, but could be used flexibly to meet those investment needs

•  Opportunity to set prices to cover full costs of using the system, leading to more efficient use of the system

•  Alignment of user benefits with payment by users of the road network paying the mileage charges

Cons

•  Public and political acceptance of pricing, at least initially, likely to be low due to the extent of the paradigm shift in how people are charged for transportation and concerns/perceptions about privacy implications of pricing implementation and enforcement

•  Considerable costs and challenges (institutional, administrative, and cultural) of implementing a nationwide mileage charging system; but as technology and experience with pricing improves, at least some of these challenges likely to diminish

•  Unless implemented in conjunction with major federal program reforms that use price and volume signals to prioritize investment decisions, a new VMT pricing scheme would do little to improve the efficiency of system investment

•  Depending on how pricing levels are set, may create poor income and geographic equity

•  No real-world experience with implementation and enforcement of pricing on a nationwide basis; full range of potential issues and hurdles that could be encountered currently unknown

•  Wide-scale shift in emphasis from taxing fuels to taxing travel distance represents a major change to the traveling public (simply implementing a flat price per mile fee will require public education and take time to gain acceptance; incorporating additional factors such as congestion and emissions costs into a VMT pricing scheme, particularly if done all at once, will increase the complex- ity and challenges of achieving public and political acceptance)

•  Time frame required to implement a VMT pricing system prevents it from being solution to short-term federal funding needs