Oregon mileage tax raises concerns about tracking, cost

By David Tanner, Land Line associate editor | 7/10/2013

Truckers are among those paying close attention to a measure in Oregon that would allow certain vehicle owners to opt out of paying the state fuel tax if they agree to having a flat fee levied on each mile they drive. Although the measure does not apply to heavy trucks at this time, truckers are outspoken about what could amount to paying substantially higher taxes to travel.

The measure, SB810, currently resides on the desk of Gov. John Kitzhaber after passing votes in the Senate and the House.

If Kitzhaber signs the bill into law, the tax on vehicle miles traveled, or VMT, would take effect in July 2015. It would allow up to 5,000 Oregon residents to voluntarily pay by the mile via GPS vehicle-tracking technology or at the pump via a wireless transponder that communicates with their vehicles.

The tax would amount to one and a half cents per mile for light vehicles.

The concept to may seem simple but it’s not, according to those paying attention to efforts that essentially amount to converting every mile of roadway into a toll road. One who is paying attention is Ryan Bowley, director of government affairs for the Owner-Operator Independent Drivers Association.

“It is one thing to have a user fee for transportation – which is what we have today. It is another thing to have a tax on mobility, and that is what VMT proposals and tolling systems largely are,” Bowley told Land Line.

The U.S. Government Accountability Office released a report in January that analyzed three scenarios involving vehicle mileage taxes.

The GAO showed that truckers could expect to pay in the range of 3 to 8 cents per mile depending on the scenario.

That means a trucker currently paying an average of $3,363 in fuel taxes into the Highway Trust Fund would see that amount increase to $5,792 under a VMT tax.

And like many other individuals and groups, truckers are concerned about personal privacy when it comes to vehicle tracking. Then there are issues of cost to set up and run a VMT collection system.

Bowley says it’s unnecessary to create a new bureaucracy to supplement or replace the current user-fee system based on fuel taxes.

“Outside of the GPS and privacy-related issues, there are significant concerns with the cost of implementing and continuing a VMT system,” Bowley said. “The costs of policing the taxing on individual vehicles – 250 million cars alone – when compared to today when the actual tax is paid for at the rack – just a few thousand, nationally – are huge and will likely only result in more money going into the hands of vendors and administrators and less into improving and maintaining our roads and bridges.”

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