By on May 2, 2011

Editor’s Note: The text of the “Transportation Opportunity Act” with section-by-section analysis can be downloaded in PDF format here [courtesy: bna.com]

The White House last week began circulating its legislative proposal for transportation reauthorization that included provisions to add toll booths to existing freeways and impose a tax for every mile driven. The “Transportation Opportunities Act” for the first time gave the Obama administration’s full approval to the concept of an added charge on drivers for the use of roads throughout the country, including on existing, untolled freeways in major metropolitan areas.

“This section [2217] amends existing law to include two new options that provide more flexibility to finance new construction or capacity, and manage congestion, through the imposition of tolls,” states the proposal’s official summary. “The first option focuses on metropolitan congestion reduction and permits state and local governments to impose tolls on existing interstate and non-interstate facilities for the purposes of improving or reducing congestion in metropolitan areas with populations over one million people. Under this option, tolls may be imposed on specific lanes, whole facilities, or a network of facilities within the metropolitan area.”

The plan would require that commuters be charged higher rates during peak morning and evening periods and that the revenue generated be used for capital improvement projects near the toll facility. A second “interstate system improvement” plan would allow tolling in smaller areas so long as the project included new capacity. Electronic transponders would be required for toll collection on the new lanes.

The changes are significant, as existing federal law limits tolling of interstates to a specific number of pilot projects. The proposal is also a reversal of sorts for an administration that early on backed away from the concept of a nationwide per-mile toll floated in February 2009 by Transportation Secretary Ray LaHood.

“I can weigh in on it and say that it is not and will not be the policy of the Obama administration,” then-Press Secretary Robert Gibbs said at the time.

That would change as the White House plan would set up a six-year project to address the technological challenges to establishing a system to track drivers for the purpose of imposing a tax for each mile driven.

“This section [2218] would establish a Surface Transportation Revenue Alternatives Office within the Federal Highway Administration,” the section-by-section analysis states. “The office would analyze the feasibility of implementing a national mileage-based user fee system that would convey prices to users to reflect system use and other travel externalities and serve as a funding source for surface transportation programs.”

The purported reason for including the per-mile taxing system is the potential for increased use of electric vehicles. The administration has poured billions in gas tax dollars to subsidize the companies that manufacture these electric vehicles as well as the end users who buy them. A “public awareness communications plan” would be implemented to sell the plan, which may be difficult. In the UK, an official petition against the idea of a per-mile tax gathered 1.8 million signatures on the prime minister’s website.

[Courtesy:Thenewspaper.com]

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43 Comments on ““Transportation Opportunity Act” Moves Towards Freeeway Tolls, Pay-Per-Mile...”


  • avatar

    Mandatory GPS?

    What a revolting picture.

    • 0 avatar
      Luke42

      The article doesn’t say GPS.

      Conventional toll systems such as the Pennsylvania Turnpike are already mileage-based. They hand you a slip of paper when you get on the highway that shows where you got on, and then you hand it to the toll booth attendent when you get off of the highway and they ask for the amount on the rate-schedule (which happens to be printed on the slip of paper). That’s a mileage-based toll on the highway.

      Similarly, the toll barriers on I-77 in West Virginia are mileage-based. The more miles you drive between the Virginia Border and Charleston, the more toll booths you go through paying your $1.50 or whatever. I have some concerns about the safety of this system, though, since it is quite challenging to extract cash from your wallet while shifting gears, steering, and rolling down your window while driving with the traffic on a twisty mountain highway… It’s a bit easier in an automatic with electric windows, though, and practice does help with getting the timing down.

      My biggest problem with tolls is that a particular toll operator in Colorado turns their missed tolls over to collections very rapidly. A family member went through the toll booth driving a car in which I’m the 1st registered owner, so the toll operator a bill. By the time I figured out what it was, they’d tacked on a $10 late fee for $6 in tolls. Then, by the time my check cleared, they’d tacked on another $20 in late fees and turned it over to collections, adding another $30 to the bill. Those bastards charged me $60 for a $6 toll. This is a “gotcha” game that needs to be fixed, if tolls are going to become more common.

      I won’t accept a GPS tracker on my car, but there’s nothing in the article that suggest that this is what is being proposed.

  • avatar
    mdwheary

    This is one of the dumbest proposals ever. Just raise the tax on gasoline and people will look for alternative ways to get around.

    • 0 avatar
      colin42

      +1. Simple, Cost Effective, Not gonna happen!

    • 0 avatar
      SimonAlberta

      I don’t believe it is that simple. Higher prices only have an effect during the initial shock phase then people just adjust to it. For me I’d just eat less pizza or restaurant meals, buy less clothes or whatever to compensate so no way would higher gas taxes reduce my driving by much at all.

      I suspect I am in a majority. Sure, we could probably all reduce our driving somewhat but most of us don’t want to.

      • 0 avatar
        Luke42

        That is, indeed, what happened during the 2008 oil price spike.

        Driving only went down a little, but all of the optional purchases (with elastic demand curves) that you mentioned went down a lot. (I’m trying to find a reference; I thought there was a Planet Money podcast about this topic, but I haven’t found it yet.)

        The demand for driving is pretty inelastic in the short term. I’ve found that my personal demand for oil is more elastic in the long term (when I moved in with my wife, we chose a house that’s close to work which has cut our gasoline usage by about 90%), but since I won’t be moving any time soon, changing the amount we drive won’t be happening any time soon either.

    • 0 avatar

      My sentiments exactly

  • avatar

    Hey, why not further crush any signs of economic recovery?

    Good grief. So, decades ago the Feds fund the construction of the Interstate system, making it a better alternative to rail, so that years later they can complain that everyone drives too much and no one uses commuter rail (which, incidentally, now needs a bunch of funding)! Then, they fund the hell out of electric toy cars, only to come around again and complain that with fewer people using gas, they’ll need some way to make up that revenue loss!

    Here’s what I think: what happened to all of the tax hikes and new taxes that were supposed to fix the roads and fund them forever over the last forty years? And all of the super-infrastructure-fixing stimulus money? If they account for that first (i.e. that that’s actually where is all went/is going), and then take a machete to the cronyism in the transportation construction industry… only then could something like this be justified.

    Also — doesn’t this further hurt the poor? It makes it even more expensive for them to travel. So that would mean… road tax subsidies for the poor? Calls for additional funding of mass transit, because driving is just out of reach of the poor?

    • 0 avatar
      philipwitak

      “…fund the hell out of electric toy cars, only to come around again and complain that with fewer people using gas, they’ll need some way to make up that revenue loss!”

      san diego has implemented a similar strategy concerning residential water use. over the last two years, we’ve had about a dozen water-rate hikes and the law of the land commanded conservation. so we ‘reduced’ it more than 10% and they continue to raise rates because, now, they aren’t quite as profitable as they had been while we were ‘squandering’ one of our most essential resources.

      this is the way our world works. or doesn’t.

  • avatar
    Truckducken

    This should be an entertaining thread. I can’t wait to see what excuses folks roll out as they seek to avoid paying their share. In the current system, however, this proposal smells a lot like double taxation and will certainly be represented as such by the loyal opposition. The congestion pricing aspects of this plan may produce some interesting results, and could be a good thing if peak congestion is reduced. (But if construction is no longer needed, where do the funds go?) Meanwhile, the electric vehicle rationale is just plain funny. Get back to me in ten years on that one.

    • 0 avatar
      M 1

      Define “my share.”

      Double taxation? Let’s see… I pay a new vehicle tax when I register a vehicle for the first time in my state. Each year I pay a tax to keep it registered. I pay three taxes when I put fuel in the car — federal, state, and local. Sometimes it’s four taxes depending on which county/municipality you’re in. Some of my vehicles even won me an extra tax simply because they cost more than usual. Change tires? Disposal fees. New battery? Disposal fee. Think those don’t count? Go check how your state actually spends that money — in the four states I’ve checked (out of sheer curiosity based in various business reasons), none of them are even remotely related to the source of the revenue. Fortunately my state doesn’t saddle us with inspections, but there’s another one for you.

  • avatar
    bwell

    Alternative solution:

    1. Increase gasoline tax.

    2. Eliminate subsidies for hybrid/electric cars.

    3. Devote revenue/savings to roads and other infrastructure.

    Result: No need for vast complicated systems which impair freedom of movement by citizens. But impairing freedom of movement is the goal here, isn’t it?

  • avatar
    Stinger

    If you read through this, you will see many other things that raise red flags, especially in higher population areas. A good part of this act involves ” Sustainable and Livable Communities”.

    Correct me if I’m wrong ( I may be) but it looks to me like this act will take road tolls and use the for the road first, and then move the tolls to other forms of transportation (trains, bikes, etc). There is also wording in here about using federal money to acquire property at very early stages in a planning process for new projects.

    To me it looks like a game plan to shift more money out of our pockets and into the control of the state and federal government, and of course, spend it on things that very few people will actually use.

  • avatar
    MarcKyle64

    I’ve already paid for the roads and their upkeep by the taxes on the gasoline I’ve bought for the past 32 years. This is going to backfire and depress the economy even more! Maybe it’s time to emigrate…while I still can.

    • 0 avatar
      asapuntz

      Can’t speak to your contribution / usage, but in general, the US is not keeping up with infrastructure maintenance costs. $0.184/gal isn’t worth what it was, and we keep building more to support ever-more-distant housing developments.

      http://www.economist.com/node/18620944?story_id=18620944

      Since taxes are such a dirty word, esp for those who have the “free speech” (cash) to fight increases on their earnings, we’re down to user fees.

      In the meanwhile, we end up paying for the neglect indirectly. I suggest buying an SUV to cope with the potholes – sure, they’re expensive to operate, but at least you’re moving instead of waiting for a mechanic.

  • avatar
    nikita

    If a significant percentage of passenger vehicles become plug-in, how will road use be taxed for them? If there was a separate electric meter on the charging plug, that power could be taxed for road use.

    • 0 avatar
      Luke42

      EVs aren’t really for Interstate travel.

      So, just have the owner put down the odometer reading on their taxes, like any of the other numbers on your tax bill, and charge accordingly. I hope to own an EV in the intermediate future, and this would be acceptable — I don’t object to paying my share of road taxes, but I do object to big brother measures. If there’s a little bit of bleed-through (for people who live close to state lines), that’s probably OK.

      It’s trickier with a plugin hybrid like the Volt. I don’t have a good answer there. Maybe an additional odometer for “EV Miles”? That’s already part of the Volt’s performance-monitoring system, so maybe the owner can query that value from the engine computer.

      And, yes, odometer fraud is already fraud. No need to create a new law for that.

  • avatar
    ClutchCarGo

    To all who have already suggested or will suggest that it is simpler to just raise the gas tax, consider what happens in the US whenever anyone proposes raising a tax. Taxes have become the new “third rail” of politics, the hottest of hot buttons and the favorite club with which to pummel the opposition. In fact, reducing gas tax is the current (tho unhelpful) solution being proposed to help with rising gas prices at the pump. Increasing gas taxes to pay for infrastructure and/or reduce fuel use is an absolute non-starter and D.O.A. Tolls, on the other hand, especially if leveraged on interstate highways only in metro areas, will have some chance of avoiding the “tax” label, and will also have the support of those who sell transponder equipment.

    • 0 avatar
      Luke42

      I agree, but that’s a political problem that doesn’t have anything to do with the underlying issue.

      • 0 avatar
        Jerome10

        I agree here completely. The gas tax has not been raised in how long? With inflation, which is getting worse, and the increase in the cost of materials, I think I’ve read that the money doesn’t go anywhere nearly as far as it once did.

        So, I’m OK with this, because our roads and bridges are falling apart, and I can pay a few bucks a fillup to keep us safer and more comfortable. As someone mentioned, big soft suspension trucks handle potholes better. How much fuel does that burn?

        The problem too is that these gas taxes are too successful, so a lot of places skim the money and use it for other purposes, and that is what REALLY angers me.

        And this too. We all paid for the interstate highway network. All of us. Now those in big cities will have to pay more? Congestion pricing is BS in my opinion, because it allows those wealthy enough to afford it to use it, others to change their schedules, etc., and we ALL paid for it. Congestion balances out. If you know its busy, you try to work around it. But they know most people can’t, so morning and evening rush are just tax-grab times. But, you know, its “for the environment”.

        Unintended consequences as well: Size streets. What do you think will happen when they tax the interstates? Flood of cars to city streets in these 1m+ areas. Then what? That burns more gas and will likely increase accidents. Also, I can see a LOT of folks simply moving. People are already tired of increases in taxes and fees, and they vote with their feet. Add this one to it, and you’ll see more sprawl and population losses. And it will leave those unable to move in the core, with lower tax revenues because the big tax payers will have left. See: Detroit.

        I suppose I’m just real real real tired of politicians being incredibly creative in coming up with ways to get more of our money, and can’t ever seem to simply live with what they have. They want our money, then they want to use it to control our lives based on what they feel is best for us.

        And I’m also really tired of politicians being so afraid to “lead” that they won’t even mention a gas tax. Explain why it is necessary, protect it from rerouting to other areas, and be done with it. But do I expect the public to be able to rationalize it? No. This is the public that assumes ANY tax is unjust (I tend to agree most are, but not the fuel tax, it is fair and it works), and a public that wants gas tax holidays so they can save themselves an average of $20-$30 in gas taxes for a couple months.

        Yet we seem ok with running up debts that result in interest payments alone in the billions? And this is the same public that seems to think we can have everything, for free. And this is the same public that doesn’t have any issue with hidden taxes or fees, such as the massive devaluation of their savings and paycheck through increased inflation. But you hear gas tax, and OH NO, watch out. Better to come up with something horribly complicated, disruptive, less fair, and limits mobility just so we don’t have to call it a “tax”.

        I almost can’t take it any more. EVERYTHING is done for money, control, and for politics.

  • avatar
    Jedchev

    This is really scary and disappointing. The amount of micromanaging that this administration and secretary LaHood has been doing in the automotive sector is reprehensible. I thought nothing could be worse than Cash for Clunkers, but I was wrong.

    “Electronic transponders would be required for toll collection on the new lanes.” That’s incredibly frightening. Maybe I’m paranoid, thinking that they’ll be watching me, but with the incentive of taxation, I am sure they will. Also, what’s to prevent them from mailing you a ticket when the transponder reports to Big Brother that you’re exceeding the speed limit?

    Also, these “congestion pricing” schemes, including our stillborn one in NYC, are baffling to me. Congestion means that the city is a vibrant, bustling place with a strong economy. People drive into the city to work and spend money. There are plenty of towns that would love some of that congestion.

    • 0 avatar
      Ubermensch

      “Congestion means that the city is a vibrant, bustling place with a strong economy. People drive into the city to work and spend money. There are plenty of towns that would love some of that congestion.”

      Just like smoke stacks billowing black soot into the air indicate a productive industry. Congestion is a negative side-effect of vibrancy, not just an indicator. Congestion was one of the major factors that drove me away from a major metro area to return to the midwest. They won’t be seeing my dollars spent in that city any longer.

    • 0 avatar
      Highway27

      Congestion means that productivity is being lost. It’s a sign of inefficiency and waste, not of vibrancy and strength.

      Congestion pricing helps to combat one of the major problems of the commons resource that roads represent. It reflects the cost of your traveling on that road. It helps to internalize the cost of thousands of people and cars sitting, rather than leaving it as an externality to be ignored by the people on the road. It also allows people to make the calculation whether the cost of going on the road is worth as much to them as it is to the other users of the road.

  • avatar
    ixim

    Don’t worry, if this goes through, the Federal gas tax will also be raised. Lotsa new revenue to build…..more “capacity” for uses [commuting by car, not taking mass transit, etc.] that they want to curtail. Meanwhile, the mpg of America’s fleet will continue to improve, leading to revenue shortfalls, leading to…..more coercive proposals like this. LaHood and his pals never met a Big Brother technology they didn’t like.

  • avatar
    Sundowner

    I don’t like being tracked either, but it’s the fairest way to go. You odn’t have to pay to upkeep roads you don’t drive on. Average fuel economy keeps going up, the cost of bridge steel and road asphalt goes up, the fuel tax revenue keeps going down. The number of lane miles that can be paved or repaired in a year on a reducing budget is plummeting.

    For the most part, the state gas tax plus the federal gas tax is around $.50/gallon. Some are more, some are less. People who by moder cars with even mediocre fuel economy are paying as little as $0.02-$0.03 PER MILE to use a road. That guy in the Prius is shelling out less than a penny a mile in NJ, with the 3rd lowest gas tax in the nation. That’s a pittance when you think about repaving, snow plowing, drainage maintenance, and what it costs to build a bridge.

    • 0 avatar
      M 1

      “You odn’t have to pay to upkeep roads you don’t drive on.”

      This proposal (unlike the Oregon experiment a few years ago) only tracks the miles you drive, not where you drive them.

      Not yet, anyway. That’s probably Phase II.

    • 0 avatar
      MikeAR

      The first thing I’ll say that I had no idea New Jersey’s gas tax was so low. It’s hard to picture it that low when all their other taxes are so high. I’d like to see the costs of road maintenance and construcion compared to the total revenue from the gas tax. I would guess that they match fairly well if gas tax monies don’t go to other transportation or non-transportation uses.

      • 0 avatar
        aristurtle

        New Jersey needs to keep its gas tax low because they have the idiotic policy of not allowing motorists to pump their own gas. This means that the overhead costs of a gas station are higher because they need to hire full-service pump attendants, so the gas tax is kept extra-low to compensate, so that the overall price of gas is about the same as in neighboring states.

        As an added bonus, it means that whenever a New Jersey driver is filling up his tank in a different state he spills gas everywhere.

        Anyway, road wear scales proportionally to the fourth power of axle weight. How much do you want to bet that they won’t bother to scale a road use tax accordingly?

      • 0 avatar
        ixim

        Jersey’s gas tax is low, and they have to pump your gas for you, because that’s the way the voters want it. It’s another one of those political “third rails”. In neighboring New York, taxes make the price of regular about $.40 higher, and you have to pump your own. About Jersey property taxes….don’t ask.

    • 0 avatar
      MikeAR

      I had forgotten about NJ and Oregon. It’s unbelievable that you can’t pump your own everywhere now.

  • avatar
    Highway27

    I’m fine with tolls on new construction, and I’m even fine with congestion pricing on toll facilities (price it so that the road is moving, even if you’re at 15 dollars or more a trip). Capital costs are so high, especially on discrete new roadway capacity (which around major cities tends to have higher environmental remediation costs and more limited available right of way), that funding the construction with bonds to be paid back by tolls is both a good way of funding the construction and helping to ensure that the roadway is needed (since if you’re not paying the bond off with the tolls you’re in big trouble, so you need the customers).

    I would love to see all gas taxes moved into their own funds, rather than just shoved into the general fund as some states do. I’d like to see funds from gas taxes reserved for roadway network improvements: widenings, repairs, rehabilitations, optimization. Stop diverting gas tax funds to non-roadway purposes like mass transit (those things should pay their own costs out of fares, or be up front about the general fund subsidy they get). Then we could have an honest discussion about whether the gas tax needs to be raised, lowered, or kept the same.

  • avatar

    Here in the Austin area the state is proposing that the new toll road 130 be turned into a free highway and one lane of IH35 be turned into a toll lane. How crazy and stewpid is that? TR130 was built to get the trucks off of IH35 but since that didn’t happen they want to swap highways. Unbelievable.

  • avatar
    tedward

    I will be one of those people who refuses to install a GPS tracker if something like this goes through. I will also be willing to spend considerable time and energy figuring out a way to uninstall or game the machine once my hand is forced. Do the feds really think they’ll be able to integrate this kind of, by necessity aftermarket installed, device without leaving some blatant workarounds in place? I mean really, cars are designed specifically to be accessible for service and upgrade. Stand alone batteries don’t last forever and car batteries can be disconnected, so how will they know if I kill power to muck around with the install?

    Also, since this has direct repercussions on my daily quality of life, I will vote in such a way that this does not come to pass or in order to make it problematic and expensive to implement (local opposition for instance). Just like I voted with my wallet when my insurance company offered me a pilot program to track driver behavior in order to reduce my rates. One phone call, “you’re fired.”

  • avatar
    CliffG

    If you are desirous of raising taxes on the middle class, you have to come up with ways that work around direct taxation. Thus, the fascination with a VAT. The nice part of tolls and gps monitoring is that it provides a way to recompense the poor for driving, something a high gas tax makes much more problematical (as anyone with a business and attempts to use the gas mileage deductions can tell you). Since the rich could care less, one ends up with support from the class that donates, and the class that uses, and the middle – well, bupkis for you. Gps monitoring is a way to extract road tax money from the enlightened electric car users, plus can be used by various state police agencies to more effectively supplement their road infraction coffers. Just as the EIC is used to rebate SS/Medicare tax payments, one could see a road use tax credit to keep the poor on the roads. So, looks like a win-win to me. Unless you are in the middle class, well, sucks to be you.

  • avatar
    Contrarian

    I hate these Orwellian newspeak names that this administration gives it’s Big Brother programs; “Affordable Healthcare Act”, Transportation Opportunity Act”, etc…

    In a graveyard in Sutton Courtenay, Oxfordshire, one of the occupants is either spinning or has a big stool-eating grin. Not sure which.

    • 0 avatar
      Ubermensch

      This administration is not unique in this respect. Compassionate conservative, trickle-down economics, patriot act, free trade, globalization, etc… are all Orewelian in their creative use of the english language.

  • avatar
    jet_silver

    So, Mr. President, you’re proposing another item that makes living in Europe suck (ubiquitous tolls on highways) without getting one iota of legislation in place that makes Europe awesome (good, affordable medical care even for non-EU citizens)?

    This country needs a true Left, and it needs it badly.

  • avatar
    ZoomZoom

    “I am Outraged!”

    Puh-lease. We have the government we want. I’ll believe we’re really angry when we actually get really angry.

    Like 75% of current politicians being de-elected. By a majority of 75% with no foolish “undecideds”.

    Like a 75% increase in attendance at school board and PTA meetings, and some real turnover of the politicians that run those corrupt organizations.

    Like some actual BAD JUDGES being voted out of office in those elections where judges are chosen by the electorate.

    Until then, I’m not convinced we’re really unhappy.

    Until then, we’re just going to see more redlight taxes, less business opportunity, more road and gas taxes, and less freedom.

    As an electorate, we have short bouts of anger, yes, but then even babies get gas sometimes, and once they relieve themselves, they smile and laugh again. We need repeated and sustained change at multiple consecutive ballot boxes, but I fear the electorate will soon go back into its usual stupor in front of Warcraft, American Idol, or YouTube videos of mating kangaroos.

    Right now, I think our so-called anger is really just false drama.

    • 0 avatar
      Jerome10

      I like this post.

      The judges one really hits home. I would do my research at voting time. It isn’t easy. But I think its important. And there are judges up for re-affirmation or whatever. There were 3 judges that received terrible reviews from everything I had read. Belligerent in court. Late constantly. Totally outside what most judges do and how they act. I vote to toss them. Read the election results? 80%+ voted to have them remain on the bench.

      I know 1 person = 1 vote is supposedly fair. But sometimes I wonder if there really should be some sort of qualifier. Something like you have to have a job, or you have to pay more in taxes than you receive, etc. Because I think we’re to the point where people put in no effort, they mark based only on D or R, or they like the guys name or whatever, and now that so many people live on the government handout, OF COURSE they’re gonna vote to keep the gravy train coming. Get enough people on that side, and you’ll be voted into office in perpetuity while completely bankrupting everything.

      And getting these same voters to the polls is easy too. Create some wedge issue like gay marriage, or a birth certificate requirement for public officials, or something along these lines, and these people will vote all day to have more money taken from them, accept more govt control and spying, bigger government, less freedom, etc., so long as they can make sure 2 dudes can’t get married to each other. What’s the saying about the nose and your face? Or the forest and the trees?

  • avatar
    cheezeweggie

    Americans want the biggest and the best, then whine when they need to pay for it.

  • avatar

    Here are my thoughts on the subject, this is a direct infringement on our rights.


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