Jack Opiola provides an overview of the ongoing debate over US infrastructure funding and the progress – or lack of it – towards vehicles miles travelled road user charging. The future funding of transportation and mobility infrastructure is attracting increased attention. There has been sharp debate in the US, where landmark reports from the National Surface Transportation Infrastructure Financing Commission and the National Surface Transportation Policy and Revenue Study Commission both stated that the cu
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Both commissions and a growing number of industry figures have argued that the nation should replace motor fuel taxes with a user-pays system based on Vehicle Miles Travelled (VMT). Most such proposals envision the use of sophisticated in-vehicle metering equipment, which might be phased in with new vehicle purchases. Some see the 5.9GHz vehicle-to-vehicle and vehicle-to-infrastructure technologies in the US Government’s IntelliDrive programme as the solution.
Others look to simpler Dedicated Short-Range Communications (DSRC) or Radio Frequency Identification (RFID) to identify the vehicle at the pump and: charge fuel untaxed to the driver who pays by distance; or charge fuel at the taxed rate for those who do not participate. Small groups of opponents to VMT see a base system of using the existing vehicle odometer and yearly or periodic readings, either manually or electronically, as the best short-term solution. Regardless of the approach, a prolonged transition period may be required to address the policy, legislative, privacy, efficiency, security, fraud and enforcement concerns of any new system.
VMT is a new and transformational concept. Fuel excise tax was never the best choice; it was always considered second-best to tolling and charging. At the time it was established, it was considered to be a crude, inaccurate and blunt means to recover user costs and pay for the infrastructure needed to connect and defend the continental United States. Eisenhower’s Interstate system did much to create economic power, create new markets and promote competitiveness. Some argue that it helped create the ‘American Dream’ and emptied cities into the suburbs by facilitating development. The negatives of environmental impacts, congestion, accidents and incidents played second fiddle to progress and profit. But times and circumstances change.
324 US Department of Transportation and the 1999 Environmental Protection Agency all consider that technology exists to make VMT practical, efficient and enforceable. A select few, like House Committee on Transportation and Infrastructure Chairman James L. Oberstar, consider the situation to be critical and a new system possible in two to three years. His view but it is a wake-up call. There is unease due to the lack of clear-cut answers, policy guidelines, simplified implementation details and timelines. Transformation could well be painful, protracted and messy. But fighting change won’t make it go away.
No-one can tell us exactly how, what, when and where VMT will be implemented. The Texas Transport Institute and other leading transportation think-tanks and universities are heading the debate. Conferences and symposiums are addressing the policy and technology aspirations of Congress. Their goal is to identify a range of options that might support the near-term implementation of a national VMT system and evaluate the relative strengths and weaknesses.
Three options appear to offer the greatest promise – metering mileage based on: fuel consumption; a device combining cellular and a connection to the onboard diagnostics port; and a device featuring a GPS receiver. While each has its own advantages and disadvantages, there are also significant uncertainties that make it difficult at present to determine the optimal configuration. The upcoming reauthorisation of the transportation bill and the FHWA road user charging programme are seen as providing the opportunity to fund future activities (encompassing planning, analysis, technical research and development, expanded real-world trials, and education/outreach) that could resolve the uncertainties and set the stage for implementation from mid-decade.
2036 Rand Corporation has been employed by The American Association of State Highway and Transportation Officials (AASHTO) and the NCHRP to conduct a study of VMT mechanisms, with several partners. The study gave several options and recommended a set of activities to further clarify the concepts surrounding VMT.
Rand is now conducting a follow-on study in the same NCHRP series to further examine and specify the types of system trials that would be most helpful to fund in the next transportation authorisation. It is seeking out experts to gain their insights into the appropriate scale, scope, design and management of the trials and ultimate VMT governance concept. Rand’s new report is several months away and how it will influence the debate is still uncertain.
The5837 Oregon Department of Transportation (ODOT), the 2035 Puget Sound Regional Council (PSRC), and the University of Iowa have conducted or are in the process of conducting pilot studies of technical applications that may be deployed in support of VMT, as well as the attendant public acceptance issues. Each was different in scope and focus. ODOT appears to be the most advanced in thinking about the systemic issues; it is promoting an open system architecture with interoperability to ensure that the system can span the range of the state’s commercial vehicle charges to tolling of roads and bridges. PSRC has addressed the user response to distance-based charges and tolling. Its work is being used to reset the state’s approach to future planning and infrastructure investment. The University of Iowa is currently testing the use of GPS as a technical solution for distance-based charging.
Together, these indicate the willingness and desire of states to find alternative financing and revenues to fund their infrastructure needs. Researchers have also interviewed DOT and Department of Motor Vehicles (DMV) or Motor Vehicle Administration (MVA) officials in Texas, Minnesota, South Carolina and Vermont. Written responses to questionnaires provide helpful insights into technical, administrative and public acceptance considerations by various states. Key observations indicate that: states are interested in the revenue potential of VMT (the potential of VMT to offset declining revenue is attractive, and state officials are following current pilot programmes with great interest); states would like the federal government to take the lead (officials believe that the federal government should take leadership in setting technical standards to prevent the development of multiple and potentially incompatible systems); odometer-based systems are not viewed favourably (state officials indicate that levying VMT fees based on odometer readings would require major changes to DMV operations and databases); privacy issues constitute a significant barrier to public acceptance (while there is general agreement on this point, there is little consensus regarding the best remedial strategy); and states are worried about the potential for fraud and evasion (an issue of particular concern to states sharing international borders).
The986 International Bridge Tunnel and Turnpike Association (IBTTA) has addressed VMT in its meetings, conferences and special sessions. The tolling industry views VMT with scepticism and fear: on the one hand, as a transformational policy, VMT could expand the transportation industry and solve many of its current issues with interoperability, cross-border enforcement, advanced payment systems and transactional costs; on the other, the use of a nationwide VMT charging programme to fund transportation infrastructure may consolidate the collection of tolls and fees into one, centralised system or distribute it amongst a number of third-party, commercial service providers. The impact of either outcome is uncertain. The IBTTA, however, is being proactive and has developed two complementary objectives: a focus on completing several small, practical, short-term projects to demonstrate a pattern of success in advancing interoperability (one example would be to connect regions of interoperability); and, in the longer term, establishment of an overarching structure for nationwide seamless systems of interoperability that could ultimately become the supporting pillars of national VMT.
Both of these objectives are reflected in the808 OmniAir Consortium’s Electronic Toll Collection National Interoperability Specification (EPSNIS) development and test programme.
National electronic payment services interoperability requires certified hardware and software standards. A programme to certify device interoperability is being built by OmniAir in partnership with the USDOT, under its IntelliDrive programme. To address the back-office interface standards that are also critical to national interoperability, OmniAir began developing the EPSNIS and will also develop a certification programme. The EPSNIS is lane-technology agnostic. It sits ‘above’ the toll point and supports a model that is applicable to a VMT-based system. The EPSNIS model: allows the disassociation of tag users (drivers) from their discrete toll authorities who – today – issue and forever own both tags and accounts; enables a central clearing corporation model which sits between toll facilities and the issuers of tags and accounts and contracts with each, independently; offloads costly tag and account management duties from the toll operator and places them with entities (banks) that do both more efficiently via huge economies of scale; and offers a choice – the EPSNIS is voluntary and operators may still issue tags or devices while using the EPSNIS, but also accept drivers who got their tags/devices and account from a non-operator entity such as their bank.
It is clear that VMT has both energised and divided the US transportation community. The debate is not primarily about technology, legislation or policy. It is about funding infrastructure, about using a ‘user pays’ concept or general taxation.
The most obvious solution is to continue with a ‘user pays’ policy. Some traditionalists argue that simply increasing the fuel tax to levels seen in Europe and elsewhere would allow it to fund our infrastructure for the next 10-20 years. However this is off the agenda for the immediate future, as was forcefully reaffirmed by Transportation Secretary LaHood at a recent AASHTO briefing: “It’s easy for people who are not elected to talk about raising the fuel tax,” he said, “they don’t have to face the voters.” LaHood left no doubt that the Obama Administration remains unequivocally opposed to this option, at least as long as there is an economic recession.
Others say ‘user pays’ should continue but that the metric, fuel tax, is outdated and should be replaced by VMT. Transport economists and industry experts agree in general.
The other side of the argument appears to be winning the day. With no new increases in fuel taxes and the HTF bankrupt, the federal surface transportation programme needed to be put on a firm footing. On 18 March 2010 President Obama signed the HIRE Act (Hiring Incentives to Restore Employment Act, H.R. 2847, P.L 111-147). In addition to extending the authorisation of the surface transportation programme through 31 December 2010, the HIRE Act transfers $19.5 billion from the General Fund into the HTF (to reimburse the latter for interest payments not received since 1998), restores an earlier $8.7 billion rescission of contract authority; and allows the HTF in the future to collect interest on its deposits. The General Fund transfer, when added to the projected revenue stream from the fuel tax, is expected to support highway and transit programmes at the levels authorised for Fiscal Year 2009 through the end of FY2012 and into FY2013, according to the Congressional Budget Office.
The above measure temporarily takes pressure off Congress and the White House. The need to address and develop a long-term transportation and funding strategy still exists, however. Efforts are expected to continue for the remainder of this year, but lawmakers and the Obama Administration are likely to take their time enacting a multi-year legislation. VMT will be left hanging in the balance.
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Jack Opiola provides an overview of the ongoing debate over US infrastructure funding and the progress – or lack of it – towards vehicles miles travelled road user charging
The future funding of transportation and mobility infrastructure is attracting increased attention. There has been sharp debate in the US, where landmark reports from the National Surface Transportation Infrastructure Financing Commission and the National Surface Transportation Policy and Revenue Study Commission both stated that the current levy based on motor fuel taxes is broken and unacceptable. Cents-per-gallon motor fuel taxes, the principal source of highway revenue for close to a century, are deemed insufficient to replenish the Highway Trust Fund (HTF) and states’ coffers in the face of ageing infrastructure, higher construction and maintenance costs and higher-efficiency vehicles. The introduction of more fuel-efficient conventional vehicles, hybrids and alternative fuel options will only further exacerbate matters.Both commissions and a growing number of industry figures have argued that the nation should replace motor fuel taxes with a user-pays system based on Vehicle Miles Travelled (VMT). Most such proposals envision the use of sophisticated in-vehicle metering equipment, which might be phased in with new vehicle purchases. Some see the 5.9GHz vehicle-to-vehicle and vehicle-to-infrastructure technologies in the US Government’s IntelliDrive programme as the solution.
Others look to simpler Dedicated Short-Range Communications (DSRC) or Radio Frequency Identification (RFID) to identify the vehicle at the pump and: charge fuel untaxed to the driver who pays by distance; or charge fuel at the taxed rate for those who do not participate. Small groups of opponents to VMT see a base system of using the existing vehicle odometer and yearly or periodic readings, either manually or electronically, as the best short-term solution. Regardless of the approach, a prolonged transition period may be required to address the policy, legislative, privacy, efficiency, security, fraud and enforcement concerns of any new system.
VMT is a new and transformational concept. Fuel excise tax was never the best choice; it was always considered second-best to tolling and charging. At the time it was established, it was considered to be a crude, inaccurate and blunt means to recover user costs and pay for the infrastructure needed to connect and defend the continental United States. Eisenhower’s Interstate system did much to create economic power, create new markets and promote competitiveness. Some argue that it helped create the ‘American Dream’ and emptied cities into the suburbs by facilitating development. The negatives of environmental impacts, congestion, accidents and incidents played second fiddle to progress and profit. But times and circumstances change.
A lack of clarity
Members of Congress, theNo-one can tell us exactly how, what, when and where VMT will be implemented. The Texas Transport Institute and other leading transportation think-tanks and universities are heading the debate. Conferences and symposiums are addressing the policy and technology aspirations of Congress. Their goal is to identify a range of options that might support the near-term implementation of a national VMT system and evaluate the relative strengths and weaknesses.
Three options appear to offer the greatest promise – metering mileage based on: fuel consumption; a device combining cellular and a connection to the onboard diagnostics port; and a device featuring a GPS receiver. While each has its own advantages and disadvantages, there are also significant uncertainties that make it difficult at present to determine the optimal configuration. The upcoming reauthorisation of the transportation bill and the FHWA road user charging programme are seen as providing the opportunity to fund future activities (encompassing planning, analysis, technical research and development, expanded real-world trials, and education/outreach) that could resolve the uncertainties and set the stage for implementation from mid-decade.
Rand is now conducting a follow-on study in the same NCHRP series to further examine and specify the types of system trials that would be most helpful to fund in the next transportation authorisation. It is seeking out experts to gain their insights into the appropriate scale, scope, design and management of the trials and ultimate VMT governance concept. Rand’s new report is several months away and how it will influence the debate is still uncertain.
The
Together, these indicate the willingness and desire of states to find alternative financing and revenues to fund their infrastructure needs. Researchers have also interviewed DOT and Department of Motor Vehicles (DMV) or Motor Vehicle Administration (MVA) officials in Texas, Minnesota, South Carolina and Vermont. Written responses to questionnaires provide helpful insights into technical, administrative and public acceptance considerations by various states. Key observations indicate that: states are interested in the revenue potential of VMT (the potential of VMT to offset declining revenue is attractive, and state officials are following current pilot programmes with great interest); states would like the federal government to take the lead (officials believe that the federal government should take leadership in setting technical standards to prevent the development of multiple and potentially incompatible systems); odometer-based systems are not viewed favourably (state officials indicate that levying VMT fees based on odometer readings would require major changes to DMV operations and databases); privacy issues constitute a significant barrier to public acceptance (while there is general agreement on this point, there is little consensus regarding the best remedial strategy); and states are worried about the potential for fraud and evasion (an issue of particular concern to states sharing international borders).
Industry moves
Outside the state-led efforts, two complementary highway transportation-related industry associations are also working to address VMT, one from a policy perspective and the other from the technical.The
Both of these objectives are reflected in the
National electronic payment services interoperability requires certified hardware and software standards. A programme to certify device interoperability is being built by OmniAir in partnership with the USDOT, under its IntelliDrive programme. To address the back-office interface standards that are also critical to national interoperability, OmniAir began developing the EPSNIS and will also develop a certification programme. The EPSNIS is lane-technology agnostic. It sits ‘above’ the toll point and supports a model that is applicable to a VMT-based system. The EPSNIS model: allows the disassociation of tag users (drivers) from their discrete toll authorities who – today – issue and forever own both tags and accounts; enables a central clearing corporation model which sits between toll facilities and the issuers of tags and accounts and contracts with each, independently; offloads costly tag and account management duties from the toll operator and places them with entities (banks) that do both more efficiently via huge economies of scale; and offers a choice – the EPSNIS is voluntary and operators may still issue tags or devices while using the EPSNIS, but also accept drivers who got their tags/devices and account from a non-operator entity such as their bank.
User-pays versus gas tax
As the industry continues to struggle with proprietary and non-interoperable DSRC and RFID technologies, the technical and systemic aspects being developed for VMT may solve its current issues and provide it with more efficient and interoperable collection and enforcement technology and legislation.It is clear that VMT has both energised and divided the US transportation community. The debate is not primarily about technology, legislation or policy. It is about funding infrastructure, about using a ‘user pays’ concept or general taxation.
The most obvious solution is to continue with a ‘user pays’ policy. Some traditionalists argue that simply increasing the fuel tax to levels seen in Europe and elsewhere would allow it to fund our infrastructure for the next 10-20 years. However this is off the agenda for the immediate future, as was forcefully reaffirmed by Transportation Secretary LaHood at a recent AASHTO briefing: “It’s easy for people who are not elected to talk about raising the fuel tax,” he said, “they don’t have to face the voters.” LaHood left no doubt that the Obama Administration remains unequivocally opposed to this option, at least as long as there is an economic recession.
Others say ‘user pays’ should continue but that the metric, fuel tax, is outdated and should be replaced by VMT. Transport economists and industry experts agree in general.
The other side of the argument appears to be winning the day. With no new increases in fuel taxes and the HTF bankrupt, the federal surface transportation programme needed to be put on a firm footing. On 18 March 2010 President Obama signed the HIRE Act (Hiring Incentives to Restore Employment Act, H.R. 2847, P.L 111-147). In addition to extending the authorisation of the surface transportation programme through 31 December 2010, the HIRE Act transfers $19.5 billion from the General Fund into the HTF (to reimburse the latter for interest payments not received since 1998), restores an earlier $8.7 billion rescission of contract authority; and allows the HTF in the future to collect interest on its deposits. The General Fund transfer, when added to the projected revenue stream from the fuel tax, is expected to support highway and transit programmes at the levels authorised for Fiscal Year 2009 through the end of FY2012 and into FY2013, according to the Congressional Budget Office.
The above measure temporarily takes pressure off Congress and the White House. The need to address and develop a long-term transportation and funding strategy still exists, however. Efforts are expected to continue for the remainder of this year, but lawmakers and the Obama Administration are likely to take their time enacting a multi-year legislation. VMT will be left hanging in the balance.
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