Oregon to Test a Controversial Mileage Tax

Published May 26, 2015

Oregon will soon institute a first-in-the-nation program charging car owners not for the fuel they use, but for the miles they drive. 

The program is meant to help the state raise more revenue to pay for road maintenance and expansion at a time when money generated from gasoline taxes are declining across the country. The decline in revenues can be traced to the ongoing sluggish economy, combined with relatively high fuel prices resulting if people driving less. It is also due, in part, to more fuel efficient cars on the road, including the influx of fuel-efficient, hybrid and electric cars. 

Beginning July 1, as many as 5,000 volunteers in Oregon can sign up to drive with devices that record how much they have driven and where. The volunteers will pay 1.5 cents for each mile traveled on public roads within Oregon, and be rebated gas taxes they pay when or if they fuel up. 

Green Car Owners Object

Some electric and hybrid car owners, are complaining about the new tax. They point out that federal and state governments have actively encouraged people to choose more fuel efficient vehicles, a choice they embraced, yet now the government wants to tax them for going green. 

The May 20, 2015 USA Today quotes Patrick Conner, a Beaverton resident who driven an electric car since 2007, saying, “This program targets hybrid and electric vehicles, so it’s discriminatory.” 

State Needs New Road Revenue

State officials argue the tax is only fair, since owners of electric and hybrid vehicles still use the roads, they should be charged for maintaining roads, just as owners of gasoline-powered vehicles are. 

“We know in the future, our ability to pay for maintenance and repair… will be severely impacted if we continue to rely on the gas tax,” said Shelley Snow with the Oregon Department of Transportation, reported USA Today

Oregon is the only state to experiment with the pay-per-mile idea, thus far, although California established a committee to discuss alternatives to the gas tax for road repair, and the pay-per-mile idea was discussed.

Oregon’s acted in response to the fact fuel tax revenues has been relatively flat in some years even declining, over the past two decades while road maintenance and expansion costs have increased. A 2009 state gas tax increase from 24 cents to 30 cents per gallon proved insufficient to keep up  construction costs and inflation. 

One concern about the program is whether it will discourage people from buying electric or hybrid vehicles. 

According to the USA Today, Drive Oregon, an advocacy group for the electric-vehicle industry, supports the program because every driver should pay for road repairs, yet, “executive director Jeff Allen expressed his worry, ‘The last thing we need to do right now is to make buying electric cars more expensive or inconvenient.'”

H. Sterling Burnett ([email protected]) is managing editor of Environment & Climate News.