Oregon Teams Up With Verizon To Tax Vehicles 1.5 Cents Per Mile

(SALEM)  The nation’s first per-mile charging system will launch in Oregon July 1, 2015 . The implementation team for Oregon’s Road Usage Charge Program, enacted by the Oregon Legislature last July, has qualified three companies to help build and support Oregon’s mileage charge collection system: Sanef, Verizon and Azuga. The companies will now pass through ODOT’s certification process in order to provide services to the program’s volunteer motorists beginning July 1, 2015.“Our vision is to create a reliable, easy-to-use, low cost, enforceable, and publicly acceptable ‘open’ system,” said Jim Whitty, Manager of ODOT’s Office of Innovative Partnerships and Alternative Funding. “A charge based on measured road use preserves fairness and accountability in supporting the state’s system of roads and highways.”How Will the System Work?

First, volunteers will choose options for participating in the program, including who will manage their mileage reporting and payment/credit. ODOT has contracted with Azuga, Sanef and Verizon to manage accounts, calculate charges plus any credits due, and submit charges to the Oregon Treasury. ODOT will audit account managers and verify that all charges owed are paid.

The road usage charge system will automatically collect mileage data from vehicles. A mileage reporting device selected by the motorist will interface with the vehicle and be paired with software to send mileage totals to the chosen account manager. The on-board mileage reporting device may be either “basic” (does not use location-determination technology) or “advanced” (uses location-determination technology).

“We learned in previous pilots the importance of using ‘open’ technology that will grow with the market and work seamlessly across account managers. An open architecture provides options for motorists in an efficient, cost-effective, market-driven system,” said Whitty. To create this open architecture, ODOT established guidelines and requirements and is conducting a certification process for the vendors who proposed to serve as account managers.

What is the Road Usage Charge Program?

Oregon’s Senate Bill 810 (2013) was the first legislation in the U.S. to establish a road usage charge system for state transportation funding. It authorized ODOT to set up a mileage collection system for volunteer motorists beginning July 1, 2015. ODOT may assess a charge of 1.5 cents per mile for up to 5,000 cars and light-duty commercial vehicles and issue a fuels tax credit to those participants. The volunteer program is the start of an alternate method of paying for Oregon’s roads.

As directed by the legislation, the Road Usage Charge Program must give motorists choices for the technologies they use to report miles driven as well as how they manage and pay their road use charges. They will have the opportunity to obtain services through private entities with market-driven options that are efficient and cost-effective.

Why is Oregon implementing the Road Usage Charge Program?

Funding for transportation system maintenance, improvements and construction has been declining in Oregon and around the country since the 1990s. This is due in part to more fuel efficient vehicles purchasing less fuel, thus paying less in fuel taxes—which go toward maintaining and building roads and highways. That’s good news for the environment and for reducing dependence on fossil fuels, but it reduces funds available to maintain Oregon roads. More information about declining revenues and transportation funding is available on the ODOT website: http://www.oregon.gov/ODOT/Pages/Transportation_Funding.aspx.

The per-mile charge is not a new concept in Oregon; the legislature first authorized investigation into options to the traditional fuels tax in 2001. Fourteen years and two pilot programs later, with extensive research and study, Oregon’s Road Usage Charge Program is becoming operational.

 

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