Oregon first in nation to test pay-per-mile idea as replacement for gas tax

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Beginning July 1, Oregon will be the first state in the nation to charge car owners not for the fuel they use, but for the miles they drive.

"We know in the future, our ability to pay for maintenance and repairs will be severely impacted if we continue to rely on the gas tax," said Shelley Snow, a spokesperson with the Oregon Department of Transportation (ODOT).

Nearly every state in the nation and even other countries has contacted her office about the program, Snow said.

Starting July 1, up to 5,000 volunteers in Oregon can sign up to drive with devices that collect data on how much they have driven and where. The volunteers will agree to pay 1.5 cents for each mile traveled on public roads within Oregon, instead of the tax now being added when filling up at the pump.

“The users, some 5,000 volunteers, will pay a set fee per mile that you drive in lieu of the per gallon fee on gasoline,” she said. “This is a replacement of the gas tax, not an additional fee,” Snow said.

The program is meant to help the state raise more revenue to pay for road and bridge projects at a time when money generated from gasoline taxes are declining across the country, in part, because of greater fuel efficiency from the increasing popularity of fuel-efficient, hybrid and electric cars.

Snow added that some hybrid car owners said the fees are unfair because they purchased their hybrid cars to avoid paying the tax.

“I’m willing to bet those people are willing to pay a little more to keep the roads they drive in good order and to keep their super nice cars safe,” she said.

While growing in popularity, electric vehicles and hybrids are still in the minority. Of 3.3 million passenger cars registered in Oregon at the end of 2014, about 68,000 were hybrid, 3,500 electric and 620 plug-in hybrid.

Like many states across the country, the gas tax Oregon collects provides just under half of the money necessary to meet its road, bridge and other infrastructure projects.

Earlier this week, the House of Representatives passed a two-month extension of current transportation funding through the Highway Trust Fund. The patch comes as a May 31 deadline approached for reauthorizing federal surface transportation funds, which includes spending on highways, bridges and transit. The measure will move before the Senate for consideration.

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