Is Road Maintenance Fee in California Drivers’ Future?

Seeking a creative and long-term solution for financing highway and road construction and upkeep, a new commission has kicked off its investigation of a “road user charge” as a possible replacement for the well-traveled gasoline tax.

Created by 2014 legislation and given the nod by Governor Edmund G. Brown Jr., the Road User Charge Pilot Program Technical Advisory Committee kicked off its deliberations last week.

Among the committee’s 15 members is Loren Kaye, president of the CalChamber-affiliated California Foundation for Commerce and Education, representing business and economic interests.

Gas Tax Revenue

A confluence of forces continues to reduce the effectiveness of the gasoline tax as a stable revenue source for highways. Pegged to the amount of gasoline purchased, the tax could keep pace neither with inflation in construction costs or increased efficiency in automobile performance.

CalTrans has estimated that inflation and improved vehicle efficiency has eroded more than 60% of the value of the gasoline tax since 1994.

And this is before the ambitious rollout of electric, plug-in hybrid and fuels cell vehicles in the state—which use little or no gasoline and therefore are the quintessential “free riders.”

In his inaugural address, Governor Brown spoke of the “importance in having the roads, highways and bridges in good enough shape to get people and commerce to where they need to go,” estimating that the state has deferred maintenance and upkeep needs of $59 billion.

In calling for a bipartisan solution for transportation finance, the Governor did not single out a mileage fee, but this option is certainly deeply in the mix.

The advisory committee has an ambitious agenda: within one year it must recommend how the state Transportation Agency can launch a pilot program testing a road user charge in real world circumstances.

The committee will examine technical feasibility, reliability, implication for privacy rights, data security, motorist compliance, and overhead costs.

Other States

California probably will not break new policy ground on this project. The states of Oregon and Washington are already examining mileage fee alternatives, with Oregon on the verge of implementing a pilot project with 5,000 volunteer motorists. Findings from these other West Coast states will be invaluable for California’s consideration.

More information on the technical advisory committee is available at a California Transportation Commission website.

Contact: Loren Kaye

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Loren Kaye was appointed president of the California Foundation for Commerce and Education in January 2006. He has devoted his career to developing, analyzing and implementing public policy issues in California, with a special emphasis on improving the state's business and economic climate. He also was a gubernatorial appointee to the state's Little Hoover Commission, charged with evaluating the efficiency and effectiveness of state agencies and programs. Kaye served in senior policy positions for Governors Pete Wilson and George Deukmejian, including Cabinet Secretary to the Governor and Undersecretary of the California Trade and Commerce Agency. See full bio.