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Utah explores new avenues to fund roads: If you drive more, you’ll pay more

That could mean forking over an annual fee based on your odometer reading or carrying a transponder that tracks your miles in real time.

(Francisco Kjolseth | The Salt Lake Tribune) People pump gas in the Salt Lake Valley on Tuesday, March 23, 2021. The gas tax may be replaced by a road usage fee.

This story is part of The Salt Lake Tribune’s ongoing commitment to identify solutions to Utah’s biggest challenges through the work of the Innovation Lab.

You might pay less at the pump as Utah looks to replace its gas tax, but that doesn’t necessarily mean it will cost you less to drive.

Hybrid and electric vehicles pay a flat fee at registration since they don’t pay as much — or any — of the gas tax that supports the state’s transportation budget, but other vehicles with higher fuel efficiency are also paying less in gas tax than those who steer gas guzzlers.

“We want to have them pay their share of expenses for road maintenance,” Rep. Kay Christofferson, R-Lehi, said of electric vehicle owners.

To make up for the difference in taxes paid, and to collect funds based on who uses the state’s roads the most, the Department of Transportation is looking at implementing a road usage charge. Under plans presented Wednesday to the Legislature’s Transportation Interim Committee, the state would charge drivers a fee of a few pennies per mile driven.

Proponents see it as an equitable way to boost the road budget as more and more motorists and manufacturers look to phase out gas-powered cars.

Utah and federal gas taxes make up about half the state’s transportation budget, according to UDOT. But that levy has lost more than half its buying power in the past 15 or so years as vehicles go farther and farther on a gallon of gas.

UDOT studied two options for a per-mile fee: One would require an annual odometer reading at the time of registration; the other would use a transponder to record miles driven in real time.

With a manual reading, vehicle owners would pay a lump sum each year. The transponder could allow for monthly payments.

The Wasatch Front Regional Council spoke in favor of the transponder option because, as UDOT’s report notes, it would allow the state to include future mileage charge options, such as high occupancy vehicle lane use or extra fees for driving at peak traffic hours.

“It provides us the flexibility to utilize these approaches to work best for Utah,” said Julie Bjornstad, the council’s senior transportation planner.

Such a fee is hardly unique. Oregon and Virginia have programs up and running, and many other states are studying the option. In fact, some Utahns are already paying the per-mile fee in a pilot program.

Hybrid and electric vehicle owners who would otherwise have to pay an annual fee, ranging from $20 to $120, at registration had the option starting last year to pay 1.5 cents per mile driven up to the cost of the flat fee.

About 3,600 vehicles chose to test-drive the transponder program in hopes of saving a bit of money, though program manager Tiffany Pocock said most of the drivers hit the cap during the first year.

About 2.4% of registered vehicles in Utah are hybrid or electric, according to a state report. Nationwide, more than a quarter of vehicle purchases by 2030 will be for hybrid or electric, according to the consulting firm Deloitte.

“It’s a small proportion of all vehicles,” Andy Yewdell, policy analyst for the Office of Legislative Research and General Counsel, told Utah lawmakers, “but it’s growing rapidly.”

If lawmakers sign off on either of UDOT’s proposals, the state would begin requiring hybrid and electric vehicles to enroll in 2024 and would expand the requirement to all vehicles by 2031.

Sen. Wayne Harper, R-Taylorsville, who co-chairs the Transportation Interim Committee with Christofferson, said the panel will meet at least two more times before a draft bill is created.

The state still would need to make some decisions on how to implement the plan, such as setting privacy rules for the collected data, whether to go with transponders rather than an annual odometer reading, and whether to include miles driven outside the state.

Those specifics aside, Christofferson said, an alternative to the gas tax is needed to keep funding the transportation budget.

“We’re going to have to figure that out and come up with something,” he said. “I think the longer we wait, the harder it’s going to be.”


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