An Argument Against VMT Fees as Replacements for Gas Taxes

"While we desperately need a way to pay for roads that better reflects the value of the space we use, just moving to a new model isn’t enough. If we don’t get the new pricing system right, it could make many of our transportation problems worse," writes Joe Cortright.

According to Cortright, technology and consumer acceptance have advanced beyond the usefulness of the VMT fee. Instead, Cortright suggests a more holistic approach to pricing:

So as we think about how to design a road finance and pricing system to replace the gas tax (and other taxes), we ought to have a system that accounts for all  the cost-drivers associated with travel:  heavier vehicles that cause more road wear should pay higher fees, as should vehicles that pollute more. How much you pay to drive on a road should be related to how much that road costs to build and maintain. Use a congested urban highway at the peak hour, and you’ll pay a higher fee than if you use a rural road at 2 am.

The article critiques the VMT fee from a couple of additional angles, arguing that a VMT is unlikely to raise as much revenue as proponents of the scheme expect, and that the gas tax is already an effective carbon tax—a much more effective carbon tax than a VMT fee can be. Planetizen coverage of the first experiments with VMT fees includes stories from Oregon, Hawaii, and California. Other states could follow.