CASPER, Wyo– Drivers of the estimated 700,000 registered vehicles in Wyoming could soon be paying a rate by the mile rather than a fuel tax. Wyoming Department of Transportation (WYDOT) Director Luke Reiner called it a “paradigm shift” in highway funding that would treat Wyoming roads as a metered utility.
Reiner likened the Road User Charge (“RUC)” to such cultural shifts as Blockbuster-to-Netflix and cavalry-to-tanks at the Wyoming Joint Transportation, Highways & Military Affairs Committee Sept. 21.
Under the RUC model, Wyoming residents would pay the rate-by-mile and be reimbursed for the fuel tax they paid at the pump. The fuel consumption calculation would be made based on EPA fuel economy estimates for the make and model of the vehicle.
A draft bill was introduced, but would undergo further revision before introduction to the legislature. If the bill were to be finalized and passed this spring, a Road User Charge could be in effect March of 2022.
“Need” for revenue: WYDOT in a budget deficit, roads in disrepair
WYDOT says it currently faces a $135 million annual budget shortfall and that the poor condition of Wyoming’s roads is having a compounding negative effect on its economy. According to Reiner’s presentation to the committee, 34% of Wyoming’s road are in “poor” or “mediocre” condition.
Those conditions cost the average driver an extra $587 a year in fuel and maintenance and reduces the maximum load weight on commercial trucks, meaning more trucks are needed to carry goods, Reiner said.
“We can’t cut our way out of this,” Reiner added, “Because the infrastructure has to be maintained.” Meanwhile, “capacity and mobility” projects — like increasing the number of lanes on certain highways — are being indefinitely delayed. Reiner said the cost of all projects will only increase with time.
Wyoming’s $0.24/gallon fuel tax is providing “exponentially diminishing returns,” according to Kelli Little, deputy director of the Wyoming County Commissioners Association. A bill to raise the fuel tax by three cents failed introduction to the Wyoming House of Representatives this February.
Little cited a University of Wyoming figure stating that 67-70% of paved county roads were in “poor” condition. Working group member and WYDOT District 7 Deputy Commissioner Phil Schmidt said that, despite Wyoming’s natural beauty, tourists were getting a “sketchy experience” on subpar roads.
He added that WYDOT’s current deficit represented 20% of its budget. To make up this shortfall, WYDOT’s revenues have to increase by 115%.
Meanwhile, Reiner said fuel tax revenues will keep going down as fuel economy increases in vehicles. He cited a study that said that by 2030, half of all vehicles sold would be electric. Reiner expressed some skepticism about that exact prospect, but said: “It’s certainly out there in the literature and in the advancing of the battery technology.”
A RUC is the “best long-term potential” source of income, Reiner said. Ultimately, the average car driver would pay about $20.27 a month to maintain roads, Reiner said, whereas now they pay about $10 a month in fuel tax.
The bill draft presents rates of 2.15 cents per mile for passenger cars and 2.87 cents per mile for pick-up trucks. Commercial trucks would pay 10.32 cents per mile. These rates reflect what WYDOT estimates would make up the shortfall.
How “RUC” works
“Like any utility, you need a meter,” Reiner said. 3 hi-tech and 2 low-tech options would be available for tracking miles driven.
An OBD-II (“On-board diagnostic”) plug-in would be available for many vehicles made after 2004. A mobile-app is another option, and a third would utilize on-board telematics (like OnStar) to report mileage.
Privacy issues involved with vehicle tracking were a big concern with constituents, committee members said.
According to Reiner, driver identities and vehicle location data would be anonymized and managed by a third-party “commercial account manager.” The state would only see an account number and miles-driven.
“We don’t want any appearance that the state would know where you are,” Reiner said, adding he’d become “very comfortable” with the privacy component of the RUC model. Reiner added that no such concerns were present with the low-tech mileage-tracking options, which are:
- Odometer reports, likely given with vehicle registration renewal
- A “permit block:” a window sticker that is purchased and good for 10,000 miles.
Invoicing would occur monthly for the hi-tech options.
WYDOT is still aiming for a fuel tax increase to collect more from out-of-state drivers. The tax increase at the pump would be rebranded as a “RUC Parity Charge,” Reiner said, and the rate could be adjusted independent of RUC rates for Wyomites.
There was concern that drivers of modified sport performance vehicles with very low fuel-economies would end up paying less for consuming more fuel. Reiner said that the law of averages suggested the funding model could take on those outliers.
There was also concern that rural drivers unfairly penalized. Reiner said many of those driver didn’t necessarily drive more because they tended to plan their outings to a greater degree.
The committee will meet again October 22-23.