Here we go again.
The gas-price roller coaster is heading up the steep incline once more, only not too slowly this time. Keep your arms and legs inside the vehicle at all times.
Prices in my neighborhood already have exceeded $3 a gallon for regular unleaded. A New York Times report says we may expect $4 by summer.
Is it Joe Biden’s fault?
One argument is that his energy plan calls for reducing production of oil — canceling the Keystone XL pipeline and new energy leases on public land was just the start — but that demand for the stuff remains high. The natural result is higher prices.
But another strong argument is that demand worldwide is rising as COVID-19 vaccinations become plentiful and the end of the pandemic is near. The ’20s are finally getting ready to roar. But, unlike during past surges, oil producers are resisting the urge to drill, led by OPEC’s stubbornness.
Oil executives are still skittish after the bottom fell out a year ago and, for a short time, traders were willing to pay people to take their oil. Or at least the thinking goes.
The truth, as usual, is probably a combination of all of the above, and it remains largely out of the control of state governments and local consumers — except, that is, for one possible solution.
A number of states have been toying with alternatives to traditional gas taxes lately. Now may be a good time to accelerate the tinkering.
I’ll put it this way: If you could eliminate the 31.4 cents you pay in Utah state taxes for every gallon you pump, and if you could gain some control over how much you do have to pay for road construction and maintenance, would you?
The answer lies in a road usage charge, or RUC, as government nerds call it. Utah and Oregon are the only states that currently offer such a program, in experimental stages. But many states have researched it.
Simply put, an RUC charges you a set sum, usually a penny or so, for every mile you drive.
Frankly, it’s the only way to fairly charge for road maintenance in the future, given how owners of electric vehicles get to bypass gas taxes completely, hybrid owners bypass it mostly and the rise in fuel-efficient gas vehicles make it less and less effective. Few people drive all-electric cars today, but experts such as deloitte.com expect 32% to do so by 2030, and higher gas prices can only move the trend along.
But if Utah and other states do make this move, it would be best to keep the program voluntary.
I’ve written about this, and about the possibility of more variable toll roads, before. Usually, a fair portion of readers react negatively to both ideas. They have a hard time seeing a future that’s right on their doorsteps.
But now the Utah Foundation has released a report called “Measuring Miles” that thoroughly examines the issue, as well as its advantages and disadvantages. The beauty of the Utah Foundation is that it is nonpartisan. It is a research organization, not an advocacy group. Its reports examine facts and do not make recommendations.
This report makes it clear that imposing a RUC won’t be simple. The state will need to calibrate the impacts of commercial and private vehicles on roads and charge accordingly. Keeping track of the miles people drive and charging them could require more administrative costs than are necessary to collect gas taxes.
But on the bright side, experiments in various states show drivers could be given a choice of ways to track their miles. They could have a GPS-enabled transponder installed in their cars. If it bothers them to have the state following their whereabouts, they could install a non-GPS transponder, instead, or use a smartphone app that lets them turn GPS on or off. (Using GPS would let tax collectors know when a driver travels out of state and stop counting those miles.)
Or, states might let people simply pay a flat charge that gives them unlimited miles — an advantage for people who drive a lot.
States might even charge people more for driving during peak traffic times, nudging them to reduce the traffic load and eliminating the need for variable toll roads.
None of these would protect gas-car drivers from that roller coaster ride of surging and ebbing fuel prices.
But road usage charges could, if implemented correctly, at least give drivers some control over how much they pay in taxes.
If these are imposed gradually, and on a voluntary basis (except, perhaps, for electric car owners), it shouldn’t take long for people to see and appreciate the difference.