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FREQUENTLY ASKED QUESTIONS: MILEAGE-BASED USER FEES

February 4, 2020

Mileage based user fees are a more effective and equitable approach to funding our road construction and maintenance.

From the study:

Using the gas tax as the main highway funding source is becoming increasingly unsustainable. First, the purchasing power of the fuel tax is declining due to the growing number of electric and hybrid vehicles as well as the increasing fuel efficiency of conventional vehicles. Second, highways have suffered, as many U.S. states and localities have diverted specific fees and taxes designed to fund them.

To more effectively and equitably fund our nation’s roadways, transportation agencies need to adopt a stronger users-pay/users-benefit approach that does not depend on fuel use and that strengthens the link between where revenues are obtained and where they are spent [such as] mileage-based user fees (MBUF) [which provide] … a more sustainable revenue source than the gas tax. Using MBUFs as the main funding source is fairer, more reliable and more transparent, and better equips transportation agencies to face continued changes in vehicle propulsion.

Author
Baruch Feigenbaum is Assistant Director of Transportation Policy at Reason Foundation, a nonprofit think tank advancing free minds and free markets.
baruchfeigenbaum88@gmail.com