A tax on how much you drive — could it happen in Illinois?

Amy Hercher, BusinessFleet | March 5, 2019
Original news item appeared in: www.chicagotribune.com

The Illinois gas tax was last increased in 1990, from 16 cents a gallon to 19 cents. In that year, East and West Germany reunited, Nelson Mandela left prison and Andre Dawson played for the Cubs

It was, in short, a long time ago, and the tax has not kept up with inflation. Some lawmakers pushing for a capital bill want a hike in the current gas tax, which helps pay for construction and repair of state’s roads and bridges.

But the gas tax has another problem. More fuel-efficient cars mean drivers buy less gas and that means lower gas tax proceeds. As a result, some states have looked into an alternate road use tax, charging by miles driven.

So far, this idea has gone over like a flying Edsel in Springfield. But the state should give it a try, said Audrey Wennink, transportation director for the Metropolitan Planning Council, a nonprofit research group.

“Even if we have a gas tax increase, that’s a short-term solution,” said Wennink, who favors a pilot program for a miles-traveled tax along with a gas tax hike so the state can learn about it.

Gov. J.B. Pritzker proposed a pilot during his gubernatorial campaign, but isn’t currently pursuing the idea, said spokeswoman Jordan Abudayyeh.

Rep. Marcus Evans, Jr., a Democrat representing Chicago and some south suburbs, introduced a bill for a miles-traveled tax pilot last month but tabled it a week later. He said the time was not ripe, and more education needs to be done.

“Most people who responded to me didn’t know what it was,” he said.

How it works

Oregon — which in 1919 was the first state to impose a gas tax, to fix its muddy roads — was also the first to try a miles-traveled program in 2015. Volunteers pay the state 1.7 cents for every mile they drive and in return, they are credited for fuel taxes they pay at the pump. The program is currently limited to 5,000 vehicles. Azuga, a private GPS and fleet tracking company, counts driver miles for the state.

Smaller pilots have been tried in Colorado, Washington, California and along Interstate 95 on the east coast, according to Nate Bryer, Azuga’s vice president of innovation

Users can choose how they want the miles counted. One way to do it is to plug a transponder into the diagnostic port of a vehicle, to count miles. If GPS is used with the device, out-of-state miles will not be counted. Pictures also can be taken of a car’s odometer, Bryer explained.

The idea is to make sure every user of the state’s roads helps pay for them, said Maureen Bock, manager of the Oregon Department of Transportation’s miles-based usage program, That means the owner of a new electric Tesla, who does not have to buy gas, pays the same as the owner of an old gas-guzzling pick-up truck. The amount of damage a vehicle does to the road is the same up to 10,000 pounds, so all vehicles in that weight category pay the same, said Bock.

Privacy, fairness issues

One of the main concerns raised about a vehicle-miles-traveled program is privacy. Some people fear having the government know how many miles they have driven. Bock said mileage information provided to Oregon’s Transportation Department is kept private, and destroyed 30 days after the bill is paid. She said if law enforcement officials wants driver data, they need a warrant.

Another worry is that rural drivers may get taxed more than urban drivers, because they are presumed to drive further distances. But research has shown that on average, rural and urban drivers drive about the same number of miles. Rural drivers do longer trips less frequently, while urban drivers make more frequent short trips, Bock said.

One advantage of fuel-efficient vehicles, besides that people pay less gas tax, is that they are less polluting.

The gas tax is effectively a carbon tax, and fairly accounts for the pollution impacts of fuel-inefficent trucks and cars, said Howard Learner, executive director of the Environmental Law and Policy Center, which opposes a vehicle-miles-traveled tax. “The tax does not differentiate between gas guzzlers and fuel-efficient vehicles. That undermines sound climate change solutions policy.”

Wennink agreed that efficient vehicles are good for the environment, but they are bad for road revenue. In 1991, Illinois residents paid $166 per capita in motor fuel taxes. It’s now down to about $100 a year, a 40 percent drop, she said.

“People are using the system more and paying less,” she said. “This results in bad conditions on our roadways, potholes, need for resurfacing and a lot of deferred maintenance.”

Bock said that the gas tax is regressive, in that people with older cars subsidize those with newer, more fuel-efficient cars. A vehicle-miles traveled tax ensures that everyone pays the same. She compared it with an electric utility, in that the more power you use, the more you pay.

Fear of higher taxes

But while a usage fee makes sense, it should not be implemented in addition to the existing gas tax, which is already high when other taxes are figured in, cautions a conservative think tank.

Illinois is one of the few states that impose both a gas tax and a sales tax on gasoline, said Adam Schuster, the Illinois Policy Institute’s director of budget and tax research. Cities like Chicago also impose their own taxes on gas.

“I don’t see us supporting the tax until it addresses the overpayment concerns and privacy concerns,” said Schuster.

There is also an issue of how out-of-state vehicles would pay. In its limited program, Oregon uses both taxes, so out-of-state and Oregon drivers who are not in the program still pay fuel taxes at the pump. A VMT-only program in one state but not in surrounding states would give visiting drivers a free ride.

The Illinois Economic Policy Institute, a think tank whose board members represent the construction industry and labor unions, believes a miles-traveled tax should be considered.

“The gas tax needs to be increased and will help revenue in the short term, but vehicles in the long term are getting more efficient, and we need a tax that is not tied to gas used,” said Mary Craighead, transportation policy analyst for the institute.

Transportation song quiz

Our last song was about a kind of street, and how it’s affected by a Chicago weather phenomenon we hope to be rid of soon. The song is “Dead End Street,” by David Axelrod, Ben Raleigh and Lou Rawls, and sung by Rawls. Michael Strom, of Rogers Park, was first with the answer.

Today’s tune was sung by stevedores, tired of being cheated by boat captains. Name the song. The first person with the right answer gets a Tribune bookmark, and glory.

‍