Oregon launches road usage charge for cars and light commercial vehicles

Across the country, states are struggling to replace missing gas tax revenues due to ever improving vehicle fuel efficiency and the gradual growth in popularity of electric vehicles. Oregon will this summer launch the first tax system based on miles driven to try and cover the shortfall in funding and while the program is initially targeting cars and light commercial vehicles I wonder if similar technology might one day be suitable for the heavy truck sector although modification of fuel taxes would appear to be an easier ongoing approach.

However for smaller commercial vehicles and vans it's an interesting approach and although Oregon is the first to launch a mileage driven based tax system it is said that as many as a dozen other states are also considering such measures.

The Oregon Department of Transportation (ODOT) have awarded the contract to Sanef ITS, the operator of intelligent transportation solutions in conjunction with Intelligent Mechatronic Systems (IMS), a leading connected car company to manage the program entirely. The long-planned change will go into place this coming July and is the first of its kind in the nation.

François Gauthey, President of Sanef ITS explained more about why the approach is seeing support from legislatures seeking to find sufficient road funding;

"We are seeing a growing trend in the number of electric and hybrid vehicles on our roads, which has led to a significant fall in critical gas tax revenues being collected for road maintenance. To improve and maintain America's roadway infrastructure, the transition from a gas tax to a distance-based road usage charge solution is a critical evolution. Moving forward, creating a sustainable but fair system for collecting revenues is essential for future sustainability of critical transportation networks. Sanef ITS America is delighted and looks forward to working with ODOT in contributing to the program with its road usage charging expertise."

The interesting situation in Oregon is that drivers will be ultimately be looking at an option of paying tax at the pump or instead a flat rate of 1.5 cents per mile driven. Initial adoption rates will be low, but it will be fascinating to see how commercial drivers in particular, react to the change. The first stage roll-out limited participation to just 5,000 volunteers (fully subscribed) and will be active on July 1, 2015.

How mileage-based tax operates:

The driver is issued with a device by Intelligent Mechatronic Systems that plugs into the vehicle's on-board diagnostics port to collect mileage data to determine the usage charge. Initially, all drivers will still pay the fuel tax at the gas station and the data will be compared to actual miles driven. The participating companies provide all data to the overseeing DOT who determine whether drivers are issued with an invoice or a rebate based on final calculations.

At first glance, it appears to be a convoluted methodology to collecting highway funding but with the technology now at hand the idea could become commonplace over the coming years. I'm keen to see whether this and/or other viable solutions can begin to alter the entire approach to appropriate road funding

About Intelligent Mechatronic Systems (IMS) - For more information, visit www.intellimec.com.
Source information courtesy of Intellimec.com