LaHood Calls For VMT, New Taxes To Raise Funds For Infrastructure, As Gas Tax Runs Dry

Derek Kreindler
by Derek Kreindler

Credit our sorely missed EIC/Editor Emeritus Ed Niedermeyer for being well ahead of the curve. B ack in 2011, Ed told me about how the rise of fuel efficient vehicles would create a revenue shortfall for the federal Highway Trust Fund, and that would lead the government to look at implementing all sorts of unpleasant things like a Vehicle Miles Traveled tax. Guess what Ray LaHood is proposing? You guessed it.

This isn’t the first time LaHood has proposed a VMT either. Back in 2009, he floated the idea as an alternative to raising the gas tax, which provides funding for the Highway Trust Fund, which is used to help maintain America’s roads. Now, LaHood is apparently telling the public that it’s in their interest to push the idea, according to The Detroit News

“Eventually people in the communities are going to persuade their members of Congress: We’re willing to raise taxes, we’re willing to pay tolls, we’re willing to go to vehicle miles traveled because we want better roads, better bridges,” LaHood said.

The big problem is that as Americans drive more fuel efficient vehicles, there is an increasingly large funding shortfall. There hasn’t been a raise in the gas tax since 1993, and Congress has spent $18.8 billion alone just to cover the shortfall for 2013-2014.

Last year, Congressional Budget Office estimated that to meet future highway needs between 2012 and 2022, the trust fund would need another $110 billion in funding. GAO says Congress could either hike gas taxes to 31.6 to 46.6 cents a gallon to fix the roads, or impose a 0.9-cent to 2.2-cent per mile tax on all travel.

The idea of a VMT, especially one tracked by GPS, is one that leaves civil libertarians in a cold sweat at night. Sources in DC tell us that a VMT essentially declared it a non-starter, not just for civil liberties reasons, but that the ROI would not be enough to justify implementing it. Nevertheless, a GAO report essentially endorsed a VMT scheme that could use GPS or other wireless transponders or prepaid “miles” indicated by a sticker on a vehicle’s windshield. Given how much the idea of the automobile is tied into the notion of personal liberty and freedom of movement, it’s hard to imagine this being acceptable to a vast swath of the American public. But something’s gotta give.

As Niedermeyer’s original report states, an increase in the gas tax (which occurred regularly from 1956-1993) is an inevitably, and the most sensible option as well. Though it would cause a hit to people’s pocketbooks, it would be the least intrusive option from a personal freedom standpoint, not to mention it would provide the requisite funding to keep America rolling.

Another side effect of a gas tax hike would be the increasing redundancy of CAFE. Rather than incentivizing auto makers to build hybrids, plug-ins, small displacement engines and increasing numbers of crossovers and trucks ( to get around various CAFE loop holes), a gas tax hike would incentivize more fuel-efficient vehicles, no matter what propulsion system they used. Even Bob Lutz is on board with said logic

You either continue with inexpensive motor fuels and have to find other ways to incentivize the customer to buy hybrids and electric vehicles, such as the government credits. Or the other alternative is a gradual increase in the federal fuel tax of 25 cents a year, which in my estimation would have the benefit of giving automobile companies a planning base, and giving families that own vehicles a planning base. Every time gas prices go back down, everybody starts buying big stuff again. Gas prices go up a buck, the big stuff is unsellable and everyone wants small cars. Go figure. It’s like the collective memory is about three weeks long. We can’t run a business that way.

Derek Kreindler
Derek Kreindler

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  • Reclusive_in_nature Reclusive_in_nature on Jun 27, 2013

    Not every problem has to be solved by more taxation. For instance, how about the States and/or federal government sell license plates to drivers with proven safe driving records that legally permit them to go 10 or 15 miles over the speed limit? OR build autobahn-like (with autobahn-like speed limits) roads parallel to the existing highways and interstates and charge a large enough toll to pay for itself and maybe even upkeep for the other roads? I know that those aren't the absolute best solutions, but at least it's a line of thought that isn't as lazy and unimaginative as just throwing more taxes at all our problems.

    • Hummer Hummer on Jun 27, 2013

      I could really get behind the 10-15 over liscense plates. I could easily see them working well, have them cost the user $100 every 6 months/ year to renew. Hell yea

  • 50merc 50merc on Jun 27, 2013

    I'm against raising gas taxes. The fact I have a tugboat-size 1976 LTD Landau with the 460 cubic inch engine has nothing to do with my opinion.

  • AZFelix Hilux technical, preferably with a swivel mount.
  • ToolGuy This is the kind of thing you get when you give people faster internet.
  • ToolGuy North America is already the greatest country on the planet, and I have learned to be careful about what I wish for in terms of making changes. I mean, if Greenland wants to buy JDM vehicles, isn't that for the Danes to decide?
  • ToolGuy Once again my home did not catch on fire and my fire extinguisher(s) stayed in the closet, unused. I guess I threw my money away on fire extinguishers.(And by fire extinguishers I mean nuclear missiles.)
  • Carson D The UAW has succeeded in organizing a US VW plant before. There's a reason they don't teach history in the schools any longer. People wouldn't make the same mistakes.
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