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Lessons from California as Washington considers road usage tax

California has discovered what Washington is learning: some people just don’t not want their mileage tracked.

Washington is studying a new driving tax now while California began its efforts in 2014. It ran a pilot with about 5,000 volunteer drivers in 2016-17. Last December, it released the final report on it. The Golden State was inspired to study new taxing methods for the same reason Washington is scrambling for its own pilot.

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As electric cars increasingly show up on roads and gas-powered vehicles become more fuel efficient, revenues collected from states’ gas taxes are dropping. This is the money states generally rely on for infrastructure projects and road maintenance. One proposed solution is to charge drivers for their use of the roads — for how much or far they drive.

Carrie Pourvahidi, road usage charge program manager for the California Department of Transportation, offered a little insight at the Washington State Transportation Commission’s meeting on Tuesday.

Despite objections, California found that a plugin device was far more preferred to track road usage.

To the chagrin of critics who argue against tracking mileage, that was the preferred method for California’s participants. Automated methods were the most popular — a plugin device that tracked miles; a smartphone app that tracked travel; telematics, which are private, in-car services such as OnStar. Other participants could manually document their driving.

“Some of the rurals were more manual; they like the more manual systems,” Pourvahidi said. “The urban like the automated system. We did see a more gradual migration to automated among the rural.”

California, Pourvahidi said, could be transitioning to this new method of road taxation in 5-10 years.

“We had manual methods as well as automated methods,” she said. “The majority of participants selected automated methods — over 86 percent selected a plugin device, a smart phone, or telematics as opposed to manual options.”

More people like to plugin and drive

The plugin devices were the most convenient and easy-to-use for the road usage charge. It recorded miles traveled directly from the car (some used GPS and others did not). Smartphone options had a drawback in that the app used more battery power and data. Using services like OnStar require further contracts and agreements between the agency and the private companies.

“(Plugin devices) work like a dream,” Pourvahidi said. “We had no problem, no issues with that device – either location-based or non-location based. The smart phone application was a little more problematic … you have this added layer where you have to take a picture of your odometer, because it’s recording if you are on a bus, a train … you have to true it up at the end of the month saying this is the odometer at the beginning of the month and at the end to generate the bill. That is an added layer for a participant to do.”

The cost of a road usage tax

California also discovered, Pourvahidi said, that finding a new way to tax is actually the easy part. Managing it, however, is going to come with an added price tag.

“At the end of the pilot, we identified some areas we needed additional study … the administrative costs,” she said. “The administrative costs of collecting the gas tax is so cheap. How can you beat that? Some of these options are going to have a high administrative costs. The better the technology, the lower your administrative costs. It will never be as low as the gas tax, but we can try to get it down to within a single digit.”

Ideally, a future road usage tax would be paid on the go, but for that, advanced technology is needed.

California is doing additional research to see if there is a way to accomplish that, Pourvahidi said.

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