Download or read book Vehicle Miles Traveled (VMT) Tax written by Misty A. Boos and published by . This book was released on 2008 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt: As traditional fuel taxes fail to meet revenue needs, transportation professionals explore the VMT tax as an alternative funding mechanism. Fuel taxes have been the primary means of collecting revenue to finance construction, operation and maintenance of US highways since the 1920s. With increasing use of hybrid and fuel efficient vehicles, aging transportation infrastructure, rising construction costs and inflation, transportation budgets are strained. The fuel tax alone is expected to be inadequate to meet public highway finance requirements within the next 20 years. The National Chamber Foundation, a public policy think tank affiliated with the U.S. Chamber of Commerce, estimates that between 2006-2015 Highway Trust Fund revenues will fall $23 billion short of the amount needed to maintain the present U.S. highway system and $48 billion short of the revenue needed to improve the existing system. (Innovation Briefs, March/April 2006) From 1970 to 2003, the gasoline tax revenue in Oregon had declined by half in 'cents per vehicle mile traveled' (after adjusting for inflation). "The gasoline tax is failing the purpose for which it was originally intended - funding the operation and maintenance of Oregon's road system." (Whitty, 2007). Many other states now recognize that for political and economic reasons fuel tax revenues will not keep pace with improvement in vehicle fuel efficiency, which is identified as the leading cause of declining fuel tax revenues in the future. One alternative widely proposed to the fuel tax is a "Vehicle Miles Traveled" (VMT) tax. Under this system, drivers pay a fee based on miles traveled rather than a tax on the amount of fuel used. The VMT tax concept can serve broader policy aims as well, by enabling policy makers to set variable fees in different network areas to reduce congestion during peak travel times, a critical and worsening issue in some metropolitan areas. Potential challenges to implementation of a VMT tax were addressed recently by the Oregon Department of Transportation in a pilot study of a VMT-type tax. Oregon DOT encountered issues of the efficiency and reliability of the technology required, the cost associated with fitting vehicle-monitoring equipment, public acceptance of the new system, increased burden on the private sector to collect fees, the cost of the new fee collection systems and the associated security and privacy issues involved in tracking miles traveled. The Oregon Pilot Study ultimately found, however, that the VMT tax is "workable and practical, a genuine alternative to the gasoline tax." (Whitty, 2007).