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SAdvancing the state of the practice of Mileage-Based User Fees 

Spring, 2012 


In This Issue
Upcoming Events
Chairman's DC Update
Executive Director's Message
Slow but Steady Progress
Oregon's New Pilot Program
State Update
Other News
Symposium on MBUF
Research Library

Upcoming Events





 IBTTA Symposium on Mileage-Based User Fees and Transportation Finance, April 29-May 1, Jersey City, New Jersey


Summit on All-Electronic Toll Collection

July 22-24, 2012

Loews Hotel, Atlanta Georgia





   Research Library Archive 


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This is the latest issue of MBUFA's e-Newsletter. Please use the "In this Issue" links (left) to jump directly to articles and departments of interest. We welcome any comments and suggestions as well as contributions --news, features or links to  recent research -- for upcoming issues.  -- The Editor.
Jack Basso, Chairman of MBUFA
Jack Basso, Chairman of MBUFA

DC Update 

from Chairman Jack Basso


     Congress is nothing if not unpredictable.  At the beginning of the year, it appeared that there was strong momentum in both the House and Senate to enact new highway authorization legislation.  The Senate moved forward aggressively, passing their legislation, Moving Ahead for Progress in the 21st Century (MAP-21) on March 14 with strong bipartisan support.  It provides the framework for the future of transportation funding for the next two years.  Within this bill, MBUFA responded to many questions by policy makers and their staffs about how to further research on issues and concerns related to technology, privacy and geography on alternative funding sources for transportation infrastructure to replace the insufficient revenue generated by the gas tax.


     The House was unable to find a formula for attracting sufficient votes to pass the legislation reported by the Transportation and Infrastructure Committee earlier this year.  Instead, on April 18, the House passed a new, relatively clean extension bill that included three unrelated policy amendments, most notably one accelerating the approval of the Keystone pipeline.  The goal of the House has been to get the bill into conference committee.  Now that they are almost there, we are looking at what will be a highly unusual conference as the Senate will be working from MAP-21 and the House bill will be a simple extension so the differences are extreme.  And even if the conferees are able to bridge their differences, the hurdle of crafting legislation that is acceptable to a majority in the House and Senate remains formidable.


     Funding for our nation's transportation infrastructure will remain a significant challenge now and even more urgently in the future.  As we move toward a conference committee in the coming week, our work, as members of MBUFA, will be even more important to help policymakers respond to the challenge of finding resource to meet our nation's transportation demands.




Executive Director's Report

Barb Rohde

by Barbara Rohde


     It has been one year since the first newsletter for MBUFA.  All of us want to thank our Officers and Steering Committee Members for their tireless efforts during this time to move the Alliance forward.  Without their efforts, this organization would not be able to be at the very critical phase we now enjoy.  We continue to be impressed with the level of interest from organizations, government agencies, research organizations, and private sector firms to be a part of the MBUFA network.


     The Membership of MBUFA has been the critical reason for the very positive success of this young organization.  We continue to be so appreciative of our Members assistance with issues as varied as membership development, public policy discussion topics, and helping respond to questions from staffs and media about this issue.  In the renewal letter to our Members this year, we highlighted the following:


     Members in the past year have helped:


·Launch the MBUFA website, the only website  devoted to mileage based  user fee issues in the United States;


·Publish an E-Newsletter three times a year;


·Schedule briefings for members  with the  Congressional Budget Office, Department of Transportation officials, Senate Budget and EPW Committee Staff, and House  Transportation and Infrastructure Staff amongst others


·Brief many organizations including the National Governor's Association Staff, National Association of Counties staff,  National Conference of State Legislatures, and National League of Cities staff amongst others;


·Develop a two page fact sheet for media and public policy makers to provide facts in a brief form;


·Respond to over 300 requests for information from Members of Congress and other public policy stakeholders on questions regarding this issue  


     Once again our thanks to the people, agencies and firms that have helped us build this critical organization. We look forward to many new Members and issues during the coming year.                                                 


Slow But Steady Progress
Kevin Condon, Managing Partner, Verdeva LLC

 by Kevin Condon, Editor   

     It's the familiar story of "two steps forward and one step back" but there is slow progress in some states in the area of alternative transportation funding.  Among the states in the front of this progress are Oregon and Minnesota, both of which are moving ahead with two new pilots. (See the feature story below by Jim Whitty in Oregon and the State Update article on Minnesota).  And the governor of Washington State just signed legislation imposing a new registration fee on electric vehicles, and designating that $1.5m of the new revenues be set aside for an MBUF pilot for electric vehicles.

     The majority of states are wrestling with the same challenge of replacing declining gas tax revenues.  In the local media outlets in various states, the list of stories and editorials on the transportation funding crisis gets longer and longer.  The politics of each state are, of course, different. But there are commonalities. Privacy concerns comes up everywhere, as do  concerns about any tax or fee increase in general.  But out of necessity some states are addressing this actively in pilots. Other states have taken the first step of creating commissions and task forces to study the issue.

     Progress is slow, but steady.  Unfortunately, the decline in gas tax revenues is also steady but not so slow.

Oregon's New Pilot Program

to Charge by the Mile 

Jim Whitty, Oregon Department of Transportation

by Jim Whitty, Manager, Office of Innovative Partnerships and Alternative Funding


     Taking a strong step to remove doubt about charging by the mile as a new road funding mechanism, Oregon DOT will run a new pilot program in the fall of 2012.  The new pilot will attempt to answer questions raised during the 2011 Oregon legislative session about the viability of applying a per mile charge to electric vehicle and plug-in hybrid vehicles.


     Oregon DOT will use the new pilot to demonstrate a rudimentary mileage charging system that will offer motorists choices about how they report mileage driven.  Oregon DOT designed the pilot around the notion that the marketplace already provides commercial off the shelf technologies that will suffice for reporting mileage from light vehicles.


     One of the issues raised during the 2011 Oregon legislative session was whether the ITS industry would be willing to cooperate and assist in Oregon's vision for a mileage charging system based on existing technologies already in use for other purposes and on motorists choosing the technologies they want to use.   Given the results of an RFI-where 28 tolling, ITS and technology firms replied-the industry answered a collective, "Yes." 


     Oregon DOT issued an RFP in March to determine which firms will support the pilot.   Nine firms submitted proposals on April 17th.   ODOT will select several firms to provide services for the pilot.  Each firm selected will undergo a pilot demonstration of their proficiencies prior to executing a contract with ODOT for the pilot.


     Oregon's pilot will test private sector provision of several key mileage- charging tax collection functions, including OBU provision, mileage data collection, tax processing and account management.   In September, about 50 VIPs from the Oregon DOT management, transportation commissioners and legislators from the transportation and revenue committees will participate in the three month test.


     The pilot intends to have four OBU categories.  The first category is a non-GPS device for counting total miles and is similar to the "dongle" style devices used in pay-as-you-drive insurance.  The second category is uses a smart phone or tablet connected with a dongle by Bluetooth connection.  The third category is factory installed telematics.  The fourth category involves after market OBUs such as navigation units but could encompass other on-board computers as well. 


     Completion of Oregon's pilot in December will answer questions related to the cost of OBUs for mileage data collection and the exact burden that would be imposed on motorists should the Oregon legislature pass into a mileage charging system for an identified set of vehicles.


     Due to the VIPs involved, the pilot is a high risk endeavor but also high reward.  If the mileage charging system can be viewed by key policymakers as "simple, easy to use" and only a small burden on motorists, the chances of per-mile legislation passing in 2013 increases greatly.



United States map 

State Update: 


Minnesota DOT Receives MBUF Policy Report.  Task Force Recommends Further Look at Alternative Transportation Funding.


     A task force charged with considering the implications of implementing a mileage-based user fee today delivered a report recognizing that such a fee could be fair and flexible, but should not be implemented until concerns are satisfactorily addressed.


     The report cited several issues for the Minnesota Department of Transportation to address, including privacy, administrative cost, complexity, phasing, and unfamiliarity of the concept among policymakers and the public. The task force was appointed by Transportation Commissioner Tom Sorel in April 2011.


     "I appreciate the effort put forth by members of this task force to identify and evaluate issues related to MBUF," said Sorel. "Their input is one step in a process, and these findings, along with information we gather from technology research currently underway, will provide policy makers with information needed to address future transportation funding issues."


     The task force agreed that Minnesota's future transportation funding sources should ensure all drivers pay their fair share for building and maintaining the transportation system and should be flexible to cover all vehicles, regardless of the type of fuel used. Additional benefits of an MBUF include sustainability, different rates for different conditions, value-added services and system management. The group identified the following concerns about a potential MBUF system: administrative cost, privacy, jurisdiction issues, feasibility, complexity, public acceptance and use of revenues.


"The task force recommended clear goals for a future funding system that moves this important conversation forward," said Jim Hovland, mayor of Edina, and vice-chair of the task force. "But we didn't feel we had enough detailed information yet to make wise decisions about a specific approach, so we recommend that MnDOT evaluate alternative models for achieving the Task Force's fairness and flexibility goals."


     One of the primary issues the task force explored was the fairness of the gas tax during an era in which less gas will be used. Currently, a driver in a vehicle getting 20 miles per gallon pays about 1.4 cents per mile in state gas taxes. A hybrid vehicle driver getting 40 mpg pays half as much, and a driver of an electric vehicle, or another non-taxed fuel source, pays no state gas taxes. 


     "We need a fair and flexible transportation funding system and the current gas tax fails on both fronts," said Bernie Lieder, chair of the task force and former chair of the Minnesota House Transportation Finance and Policy Division. "The task force supports alternatively fueled vehicles, but feels all drivers should pay to support the transportation system they use."


All of the 25-member task force endorsed the report which included a minority opinion to express viewpoints not shared by the majority of members. The Task Force report (with minority opinion): Download report. Other documents on MNDOT's MBUF technology research project are available at www.mndot.gov/mileagebaseduserfee


     The 2007 Minnesota Legislature appropriated $5 million from the trunk highway fund for the technology research project, which is taking place from September 2011 to December 2012.


Arizona Legislature looking to tax electric cars to help pay for highways


California: Southern California Association of Governments moves forward with sustainable transit plan; will consider mileage tax


Washington State enacts legislation that includes $100 annual electric vehicle fee that will expire effective date of enactment of any future vehicle mileage tax. Of new revenues from the EV fee, $1.5m to fund MBUF pilot project for electric vehicles.


Indiana: Bill to fund pilot projects for alternative transportation funding languishes in committee as legislative session ends on March 10, 2012.


Georgia: Does road funding need to change? Editorial in Atlanta  Constitution Journal.


Virginia: Beyond Virginia budget fignt politics, a vital issue (transportation) lurked.

US Capitol Building
Other News


Highway Trust Fund Threatened by Improvements in Gas Mileage:  ABC News Report


CBO reports highway trust fund headed for bankruptcy in 2014: The Hill


The week ahead: Wheels begin to turn on highway billThe Hill



Reid draws the line against Keystone: The Hill


Senate names members for Transportation Conference Committee: Port-to-Plains Blog. Senators appointed are:

  • Eight Democrats: Boxer, Baucus, Rockefeller, Durbin, Johnson     (SD), Schumer, Nelson (FL), Menendez
  • Six Republicans: Inhofe, Vitter, Hatch, Shelby, Hutchison, Hoeven
  • This Week:


    Symposium on Mileage-Based User Fees and Transportation Finance Summit

         This conference combines the best features of IBTTA's Transportation Finance Summit with the depth of content from the Symposium on Mileage Based User Fees organized by the Texas Transportation Institute and the University of Minnesota in 2009-2011.  The meeting partners and co-sponsors are joining forces to organize this combined event that will explore the latest studies and pilots in mileage based user fees and the diverse range of financing tools available to toll agencies, state DOTs and local governments.
         Meeting partners include  Humphrey School of Public Affairs, University of Minnesota and the Texas Transportation Institute. Co-sponsors include the I-95 Coalition and MBUFA.


    Online registration is now closed. On-site registration is available.


      May 18-20, 2012
    Traverse City, Michigan
    MBUFA West Coast Meeting (co-located with AASHTO Peer Exchange on Communicating Transportation Funding Issues)
    Jue 26-26, 2012
    Beckman Center
    Irvine California
    September 9-12, 2012
    Orlando, Florida

    Summit on All-Electronic Toll Collection

    July 22-24, 2012

    Loews Hotel, Atlanta Georgia


    MBUFA logo
    Research Library

    The Mediating Role of Motorists' Evaluation of Current Roadway Conditions in Determining Their Willingness to Pay for Future Improvements. Morgan State University National Transportation Center 


    Equity of Evolving Transportation Finance Mechanisms: Transportation Research Board  August, 2011


    I-95 Coalition Project Database 


    Alternative Approaches to Funding Highways

    Congressional Budget Office


    Click Here


    The Intersection of Urban Form and Mileage Fees: Findings from the Oregon Road User Fee Pilot Program, 2011

    Mineta Transportation Institute

    Click Here


    Guidelines for Shaping Perceptions of Fairness of Transportation Infrastructure

    Policies: The Case of a Vehicle Mileage Tax  

    University of Nevada Las Vegas

     Click Here


    Well Within Reach - America's New Transportation Agenda

    Miller Center of Public Affairs, University of Virginia

    Click Here


    A Forum on the Future of Highway Transportation in America

    International Bridge and Tunnel Tolls Association

    Click Here


    Transitioning to a Performance-Based Federal Surface Transportation Policy

    Bipartisan Policy Center

    Click Here


    Paying Our Way

    Report of the National Surface Transportation Infrastructure Financing Commission

    Click Here


    National Surface Transportation Policy and Revenue Study


    Click Here


    System Trials to Demonstrate Mileage-Based Road Use Charges

    The RAND Corporation for the National Cooperative Highway Research Program

    Click Here


    Surface Transportation Funding: Options for States

    National Conference of State Legislatures

    Click Here


    Idaho Governor's Task Force on Modernizing Transportation Funding in Idaho: Final Recommendations 

    Click Here


    NCHRP 08-36: "Road Pricing Communication Practices"

    Transportation Reseasrch Board

     Click Here


    Vehicle Mileage Fee Primer

    Texas Department of Transportation

    Click Here


    Roadmap to a Single European Transport Area - Towards a competitive and resource efficient transport system

    European Commission 

    Click Here


    Road Pricing: Public Perceptions and Program Development

    National Cooperative Highway Research Program (Transportation Research Board)

    Click Here


    Mileage-Based User Fees: Defining a Path toward Implementation

    University Transportation Center for Mobility

    Click Here

    Implementable Strategies for Shifting to Direct Usage-Based Charges for Transportation Funding

    The RAND Corporation, University of Minnesota and National Cooperative Highway Research Program

    Click Here


    Multi-State VMT-Based Road-User Fee Initiative

    I-95 Coalition

    Click Here


    National Evaluation of a Mileage-Based Road User Charge

    University of Iowa Public Policy Center

    Click Here


    The Fuel Tax and Alternatives for Transportation Funding

    Transportation Research Board

    Click Here


    Are We There Yet? Creating America's Future Transportation System -2009

    American Association of State Highway and Transportation Officials

    Click Here

    Congressional Budget Office 

    How Fair is Road Pricing? Evaluating Equity in Transportation Pricing and Finance

    Bipartisan Policy Center

    Click Here