Study updates mileage-based fee status

March 28, 2011

Before implementing a mileage-based fee structure to fund the nation’s highway system, there must be more comprehensive testing of the approach, as well as coordination of the testing, according to a study by Rand Corp.

The study outlines three frameworks for development of a mileage-based system: driven by states, by the Federal Government or by the free market.

“A tax based on fuel consumption, which is what we have now, is at odds with our national energy policy and is slowly skewing farther away from ensuring that those who use the highway system the most are the ones who pay a greater proportion for its upkeep,” said PHIA Managing Director Jason Wagner. “On top of that, the revenue from federal and state fuel taxes is actually beginning to decline, due to improved mileage standards and the increasing use of hybrids and alternative fuels.”

A mileage-based approach would realign the responsibility for funding the highway system without allowing the revenue base to erode due to improving mileage and the use of alternative fuels, he said.

To read the entire study, click here.

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