Comprehensive pricing refers to the imposition of direct user fees that apply on all roads and all driving in the form of mileage-based pricing, also known as vehicle miles traveled (VMT) fees. These charges can be either a flat fee (e.g., a fixed number of cents per mile, regardless of where or when the travel occurs) or a variable fee based on considerations such as time of travel, congestion levels on a facility, type of road, type and weight of the vehicle, and vehicle emission levels. Or it can be a combination of flat and variable fees.
Because of their universal nature, comprehensive pricing strategies provide a better fit as a national funding strategy for surface transportation investment than do targeted tolling and pricing. Therefore, comprehensive pricing is evaluated throughout this chapter as a potential revenue-generating tool for the federal program.
Many tolling approaches in the United States are similar to VMT fee charges at the facility level (i.e., toll rate structures are either directly or loosely tied to distance driven on a tolled facility), but the development and implementation of a national comprehensive pricing system would represent a new way of raising surface transportation revenue. Short of implementing a full pricing approach, a distance-based charge could be applied to specific vehicle categories.
Another concept related to comprehensive pricing is pay-as-you-drive insurance, in which insurance premiums are based on vehicle miles instead of a traditional flat annual rate. While not a means for government to raise surface transportation revenues, pay-as-you-drive insurance would have similar effects as a mileage-based charge to pay for infrastructure since it would make a key element of vehicle use costs both more transparent and dependent on the decision to take individual trips. For example, a $375 annual premium becomes, on average, 3¢ per mile, and a $1,250 annual premium becomes, on average, 10¢ per mile.2 A Brookings Institution study estimates that pay-as-you-drive insurance could reduce total miles driven nationwide by 8 percent, could lower total U.S. carbon dioxide emissions by 2 percent, and could save about two-thirds of U.S. households about $270 in insurance costs per year.3 Wide-scale use of this insurance could provide an important first step in the transition to comprehensive pricing and would likely encourage people to combine trips and drive less, since they could visibly save money by doing so. Implementing pay-as-you-drive insurance, however, would require most states to change their insurance regulations.