A Wisconsin Department of Transportation panel is looking into whether a mileage-based fee for driving would prove to be an effective tax.
The panel, while only in the research phase of the idea right now, would ultimately propose it to legislators for approval. If the idea were to be passed, it would install a fee for how many miles Wisconsin motorists drive in a year.
Spencer Black – a former assemblyman and now a professor in the University of Wisconsin’s Department of Urban and Regional Planning – said a strategy to help the state calculate how many miles an individual drives in a vehicle may be “very hard to administer.”
According to Spencer, the Department of Transportation has two possible ways of keeping track of miles: people sending in their mileage from the odometer, or cars including a device that would digitally transmit the number of miles a car drives. Black said mileage-based fees are still not a sound way to raise revenue.
Black added the proposal would encompass Wisconsin residents who drive on state roads. He expressed concern people who take long trips outside of the state’s borders may be hit with an unfair mileage fee.
“How do you determine [how many miles] were driven in the state and what was driven out [of state]”? Black said.
Black noted the mileage-based fees would not necessarily cause Wisconsin motorists to drive less or become more conscientious of bad driving habits.
Since fuel-efficient subcompact and hybrid vehicles can go farther on a tank of gas, Black said they would be susceptible to higher mileage fees than, for example, full-size SUVs.
“If mileage fees replace fees on gas taxes, it would punish people who drive efficient vehicles like Priuses and help those who drive gas guzzling hogs like Hummers,” Black said.
Despite Black’s hesitation on the mileage-based fee, others have found the fee would be an effective way for the state to raise revenue.
Adrian Moore, vice president of the Reason Foundation for the Mileage-Based User Fee Association, said gas tax revenues decrease with improving fuel efficiency standards.
“As cars get more fuel efficient, they use less gas and pay less gas taxes, even though they use the roads and as much or more than before,” Moore said.
He added as the price to maintain roads and highways increases, the state would have less money to pay for the repairs when they are needed. Moore said constructions are not sustainable and the most effective way to keep up maintenance is to charge the cars that “use the road for the cost of using the road.”
Moore disagreed with Spencer and said people’s driving habits would not change with the mileage-based fees. He noted a review of Oregon’s mileage-based fee test run, which found that on average, drivers drove 8 percent less than they did before the fee.
“Even though the cost was identical, they were more aware of what they were paying,” Moore said.
