Will Virginia Flub the MFUB Challenge?

Sooner or later the United States will embrace Mileage Based User Fees (MFUBs) as a financing tool for roads and highways. The idea makes so much sense that even American politicians can understand it. Every vehicle owner should pay taxes for road maintenance in direct proportion to which he contributes to the need for that maintenance. Hitting up motorists for their share of the cost of maintaining the system dampens over-use and congestion. (Deciding who pays for new construction is trickier, and I defer that issue for now.)

The big stumbling block is privacy. Equipping a car with a GPS box and tracking its every movement is not a power that everyone is willing to bequeath to government. Fortunately, the Oregon Department of Transportation, which first began testing MFUBs in 2007, has learned a lot from its experience. Writing in the Jefferson Policy Journal, Bob Poole with the Reason Foundation explains how the thinking has evolved:

Oregon DOT … is kicking off a new pilot test this fall, based on a new vision. First, the system needs to be simple and offer motorists a choice of methods. Second, the system must be cost-effective, auditable, and protective of personal information. Third, it should build on what already exists in the marketplace. And fourth, the state’s role should be limited to things like setting standards, certifying approved private-sector applications, and deciding the level and structure of charges. …

There will be four basic alternatives in the new pilot test. The basic onboard unit will be a “dongle” that plugs into the vehicle’s diagnostic port and records only total miles driven. A second alternative will make use of existing systems such as Onstar that owners already have in their vehicles, which can report locations as well as miles. A third alternative will couple the dongle with a Bluetooth connection to a smart phone or tablet; this will enable users to distinguish between miles driven in-state (which will be charged for) and those driven out-of-state. The fourth category is aftermarket devices such as navigation units that can also report miles by location, if people choose to use them for that purpose.

And for those not wanting any MBUF technology in their vehicle, ODOT is planning a system by which people can buy miles in, say, 5,000 or 10,000-mile increments. “Over time, people will gravitate toward the easiest method [for them].”

Is there any chance of experimenting with MFUBs in Virginia? I’ve heard not a peep from the McDonnell administration.


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  1. I’m curious what DJ thinks about this. A mileage-based fee seems reasonable and if you commute daily – then you actually are using the roads more.

    but how about it DJ? What’s your view?

    (FWIW, I support the principle but the concept of having big brother in your car is never going to fly).

  2. DJRippert Avatar

    I think it’s a great idea as long as it’s only the first effort to implement “user pays”.

    The privacy argument is absurd. You have no privacy today. Get over it. Your cell phone tracks you everywhere you go. It’s records can be obtained with a warrant. Your license plates are scanned and processed by roving police cars at mall parking lots looking for stolen cars. Your location is known every time you drive through an EZPass toll gantry. I can wait in front of your house to photograph you when you come out, I can film you car as you drive it, etc.

    Your privacy is protected by the law, nothing else. That’s why a phone tap requires a warrant and that’s why an investigation of your whereabouts (via cell phone records or tolling device) should require a warrant too.

    Driving is not a right. I you don’t like the tracking / taxing approach, don’t drive.

  3. Peter Galuszka Avatar
    Peter Galuszka

    Yikes. What about privacy? You could have a record of wherever you go that could be subpoenaed a civil case or otherwise misused.
    Where are the True Libertarians when we need them? The “Don’t Tread on Me” types?

    1. DJRippert Avatar

      It happens all the time now. The food you buy at the grocery store with that “discount card”? Your credit card records? ATM records? Cell phone location? Toll gantry pass throughs? Social media like Foursquare, Twitter, Waze, etc?

      The best antidote is to make the tolling records inaccessibly other than in a felony case.

      You are on the grid, Neo Galuszka. The Matrix is already watching you.

    2. Privacy — that’s precisely the point that Oregon is trying to address by offering four different options. I don’t know if those options will assuage the fears of civil libertarians, but at least they’re trying.

      1. People do know that their privacy is no longer assured and that data on then is captured all the time. They realize that their cell phone and EZ Pass and even their license plate can be “tracked”.

        But I still think putting it inside your car is a bridge too far. We have a ton of people now days that believe in all manner of conspiracy theories about govt – and they absolutely HATE taxes so I’m just not seeing people voluntarily putting anything inside their cars.

        I think the best chance we might have is for your car, without your approval, to self-announce it’s odometer reading at service stations via technology like RFID or similar. These would have to be embedded with the same precautions that we now embed the odometer itself to prevent tampering.

        there will have to be something that is on the car to start with that the owner cannot mess with that will communicate with something in the service station and push to shove.. I still think transponders and open road gantries are a better approach because the driver will willing choose to take a certain road and they know they are going to be charged.

  4. the toll vs gas tax vs mileage-based actually has political dimensions especially for the “you did not build that”, public roads, arena.

    Basically, it goes like this. If you are a small-govt, low-taxes Conservative, what is your position on roads and how to pay for them?

    that’s the question I’d like to see answered by those who say that govt is too big and taxes are too high. Do you really believe in public roads which many would say are socialist in concept especially when you consider how the right-of-way for roads is obtained via
    eminent domain – i.e. the “taking” of someone’s property for a “public purpose”.

    Bonus Question:
    Can small-govt conservatives abide by an intrusive, big-brother type user fee?

  5. Can small-govt conservatives abide by an intrusive, big-brother type user fee?

    No. Small-govt conservatives tend to do weird things like move to WV, form militias, and fly flags with snakes on them. Or they grab a backpack and head for a rendezvous with Jesse Ventura in a third world country.

  6. Every driver needs to help pay for some level of maintenance. But even there, cars and small trucks do not cause damage to roads and bridges. Heavy trucks do. Any transportation financing plan for maintenance needs to recover the bulk of costs from heavy trucks.

  7. re: small govt conservatives – in Va. dealing with big transportation issues.

    I note that George Allen has come out against the proposed I-95 Tolls.

    Is the opposed to other tolls like the HOT Lanes, Dulles Toll Road and Hampton Roads?

    What is George Allen’s solution to paying for transportation in Va?

  8. It is a dumb idea. Period. You can do the exact same thing, only better and fairer by apprpriately assessing the gas tax.

  9. Of course, we could use some logic with respect to the gas tax approach.

    How much money did the gas tax generate back in 1985 (in today’s dollars)? how much of an increase would it take, for it to generate an equivalent today?

    I’m guessing it’s on the order of 10-20 cents and in order to keep in self-leveling in the future, it would have to be indexed not only to inflation but to vehicle efficiency.

    Now, I’m guessing that not a single politician of any stripe in Va would propose a gas tax increase of 10 cents and any politician who did would be eviscerated by his opponent in an election.

    so the question basically becomes – what is a politically feasible path to increasing funding to transportation and I would assert that the question with respect to does transportation actually need more funding ought to be one of the first questions in any poll asking about various funding approaches.

    Virginia has for too long promoted the idea that the “state” funds transportation.. it’s a “state responsibility’” which has fostered an ignorance and illiteracy on the part of the public with regard to the arithmetic of transportation funding.

    When the average person has no idea of how much their own country generates in fuel tax revenues and expects the “state” to build 100, 200, 500 million dollar projects… for their county – we have a reality disconnect.

  10. I lived in Oregon when they first ‘suggested’ this trial program. It was not and is not met with open arms or open minds. The privacy and tracking thing is a huge stumbling block.

    However, my response here is in regards of this whole plan. So, I guess, the idea is that the more you drive, the more you use the roads. The more you use the roads the more you should pay for the upkeep of the roads. A great idea if that was as far as it went and if it was limited to that and ONLY that. However, the same idea is presently implimented via a gas tax. If you drive a lot, then you use more gas, you use more gas, you pay more gas tax. One mode of transportation where this isn’t true is mass transit, in particular buses (and don’t get me wrong, I perfer buses over rail any day of the week and don’t get me started on how and why buses are FAR superior). However, it is my understanding that buses are hugely subsidized, sometimes by the gas tax. Buses (like trucks) are large, heavy vehicles, they are harder on roads than the average car. Yet, governments subsidize mass transit, including buses, thereby masking the true cost of mass transit. So, if your argument is that people need to pay for what they are using, then start by making mass transit users (buses and trains) pay the true and full cost of riding. Second, quit using road money (gas tax or mileage tax) for things other than upkeep of roads.

    Here in Texas we have some toll highways, they are not cheap (in fact they just raised the prices on most of them). There are certainly ways to get to the same place without paying a toll. Recently it has come to light that one of the arguments/reasons for the toll was originally to pay for the highway, well, those highways have long been paid off. Now they are saying the tolls are staying to pay for upkeep … oh, and the whole ‘we’re pooling the money for other toll things’ (see the link http://abclocal.go.com/ktrk/story?section=news/13_undercover&id=8671067)

    Not happy about the tolls here, less happy about a mileage tax.

    1. I’m against subsidies for all modes of transportation — roads, rail, mass transit. All modes should compete on an equal playing field (with a possible adjustment to offset the social cost of pollution.) Subsidies for roads are wrong. Subsidies for rail are wrong. Subsidies for buses are wrong. Subsidies result in the massive misallocation of capital and general impoverishment of us all.

  11. re: the more you drive the more you pay gas tax.

    unfortunately this is not totally true any more as people who drive a lot on a daily basis tend to buy cars that get better and better gas mileage.

    also – it also depends WHEN and WHERE you drive because during rush hour on urban roads the cost to provide those roads is far more than ordinary roads. So the gas tax only pays the same for any road despite the fact that urban roads are far more expensive than suburban and rural roads.

    re: roads that are paid for

    NOT TRUE. The only thing that is paid for is the INITIAL construction. From that point on, you have operations and maintenance and eventually the road surface has to be completely taken up ..milled and new asphalt put down – AND it has to be done on urban roads in a way that other lanes are left open and the work often done in piecemeal fashion, at night from 10 pm – 5am and then everything put back together in time for the rush hour.

    this is very expensive compared to most road work.

    we continue to not deal with the realities here on road costs and the ability of the gas tax to pay for them.

    because of this, there is widespread opposition to increasing the gas tax and this, in turn, is driving most states to tolls.

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