UDOT is setting an ambitious timeline for all Utah drivers to pay fees for miles driven instead of the state relying on dwindling gas tax money to maintain roads, lawmakers learned this week.
All cars will be incorporated into a “road usage charge” program by 2031, according to proposals in a Utah Department of Transportation report released Wednesday during a meeting of the Legislature’s Transportation Interim Committee where members heard of the ever-increasing costs of maintaining infrastructure.
“We’re just growing,” said Linda Hull, of UDOT’s Policy and Legislative Services Division. “There are more drivers driving more miles across the state, and we’re using an aging system.”
According to Hull, the costs to maintain and create roads grow at a rate of about 7% a year, while gas tax revenue is only growing at 1% a year. This, along with the increase in fuel-efficient and electric vehicles within the state, only draws more money away from a large portion of the state transportation budget. While the program worked in 1923, when it was first established, “it will not work for the next 100 years.”
According to Utah’s Unified Transportation Plan, the total cost for transportation between 2019 and 2050 is estimated to be $108.5 billion. Existing revenue will only cover 85% of what’s needed for state roads, which spurred the Legislature’s need to find another solution.
The scenarios highlighted by UDOT study examine four factors: pace of expansion of the program, revenue generation, public acceptance and policy flexibility.
Scenario A is a mass-implementation plan that uses manual odometer reporting to measure miles driven, likely done at the time of annual vehicle registration. It would require Utah-registered vehicles with a fuel-efficiency rating over 20 miles per gallon, the state’s average, to be assessed that way beginning in 2024. This would immediately draw in over 2 million vehicles. Less fuel-efficient cars would then be enrolled over the next seven years.
Scenario B is a phased implementation. In 2024, vehicles rated at 30 mpg would be brought in, as well as electric and hybrid vehicles. Vehicles that are less fuel efficient would be added every two years after based on their mpg ratings.
This scenario also includes real-time, technology-based readings, which would offer the incentives of the current voluntary pilot program such as trip planning and monthly payment options, as opposed to a large lump sum payment at the time of vehicle registration, according to the report.
While scenario A brings in more money for road maintenance — an estimated $182 million — over a seven-year period, UDOT recommends scenario B for its tempered approach and better chance at education and outreach to skeptical drivers. It also recommends the option for equity reasons: a burdensome lump sum when a driver is already paying an annual registration fee could be discouraging to lower-income Utahns.
Scenario B also allows more flexibility for the future, says Wasatch Front Regional Council spokeswoman Julie Bjornstad.
“We need to be thinking strategically about the future of transportation and how it may be affected by changes in technology,” Bjornstad told lawmakers. “We need to make a program that can respond to technology changes in the future, like congestion prices and tolling.”
Other states are utilizing a similar program, lawmakers were told.
The analysis does not factor in out-of-state drivers and heavy commercial vehicles. Both of these users would still pay a state gas tax.
Rep. Candice Pierucci, R-Salt Lake City, inquired as to how the state would tax users fairly as the system was being implemented, so that people charged by the mile wouldn’t have to pay an undue tax for gas. UDOT representatives do not have an answer to this, but acknowledged it as part of the questions that the Legislature will have to answer. The plan was also designed with the thought that fuel tax credits would be given to participants throughout the transition period to cover this tax.
For the transportation committee, the decision will come down to what will close the gap in budget while not disincentivizing users from buying newer, more fuel-efficient vehicles.
“I think this is so helpful,” said Rep. Suzanne Harrison, D-Draper. “Rather than having a light switch approach where we suddenly go 100% road usage charge, a more feasible plan would have a multipronged approach. We’ll continue to have gas tax and registration fees, but with an expanding road usage charge.”
The programs will be studied further and legislation may be drafted before the next legislative session.