Will Mile Taxes Replace Gas Taxes?: Oregon Pilot Program Test

SALEM, Ore. November 6, 2015; NACS reports: Will a little green box attached to a car’s steering column replace the gasoline tax? That’s a question Oregon is trying to answer with its pilot program to see if collecting how many miles a resident drives—and eventually assessing a per-mile fee—would generate more income than gasoline taxes, Stateline reports.

Oregon isn’t the first state to contemplate replacing declining revenue from a gas tax with a per-mile tax. Recently, California has started its own mileage tax study. According to the National Conference of State Legislatures, during the last seven years, 19 other states looked into 55 proposals surrounding mileage-based fees.

OreGO, Oregon’s test, started in July and tapped regular citizens like Evan Burroughs to drive around recording their miles. The box recorded his speed, braking and mileage of his 1996 Subaru Outback. The data is sent to a private company, which in turn provides Oregon with the number of miles driven to calculate his tax bill, which is 1.5 cents per mile. Burroughs is only taxed for miles driven on Oregon roads, not private roads or in other states.

Some say it’s fitting for Oregon to lead the way on innovative ways to pay for road maintenance, given that the state was the first to levy a gas tax (in 1919). With newer cars being more fuel efficient, the revenue from gas taxes has fallen. “If you don’t have the revenue source you can’t maintain the infrastructure,” said Matthew Garrett, director of Oregon’s transportation department. “Traditional methods of funding transportation—the gas tax—were constructed for the longest time. But the world has changed.”