System Trials to Demonstrate Mileage-Based Road Use Charges (2010)

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117 APPENDIX B. INTERVIEW GUIDE The following pages in this appendix provide the text of the interview guide that was provided to participants in advance of the interviews. Note that not all participants were asked to answer all questions; rather, they were invited to respond to the subset of questions most relevant to their own interests, perspectives, and areas of expertise.

118 NCHRP VMT Fee System Trials Project Interview Questions for Stakeholders and Subject Matter Experts Purpose of the Interviews Current federal and state fuel taxes are beset with structural and political liabilities that have undermined their ability to raise sufficient transportation revenue over recent decades. In the coming years, expected increases in the fuel economy of conventional vehicles along with the adoption of alternative fuel vehicles are likely to further exacerbate this problem. Against this backdrop, many analysts and decision makers have argued that the nation should transition from reliance on fuel taxes to a transportation finance system in which road use fees are charged on the basis of vehicle miles of travel (VMT fees). In addition to providing a more sustainable revenue source, such a system could, through appropriate structuring of the fees (i.e., varying the per-mile charge based on vehicle characteristics and the time and location of travel), help to reduce traffic congestion, harmful emissions, and excessive road wear. In a recent AASHTO-funded NCHRP study, RAND, in collaboration with several partners, examined possible mechanisms through which a national system of VMT fees might be implemented in the near term (i.e., within the next five years). Though several options emerged as promising, the report also noted that remaining uncertainties related to such issues as policy goals, cost, institutional structure, and user acceptance make it difficult to select the best and most cost-effective approach at this juncture. The report therefore recommended a set of activities – including planning, analytic studies, targeted research and development, system trials, and education and outreach – that might be funded in the next surface transportation bill to resolve uncertainties and prepare for the possibility of implementing a national system of VMT fees beginning in 2015. RAND is now conducting a follow-on study, in the same NCHRP series, to further examine and specify the types of system trials that would be most helpful to fund in the next transportation authorization. One of the key elements in this study is to speak with knowledgeable experts to gain their insights into the appropriate scale, scope, design, and management of the trials. Based on your background and experience, we would value your participation in the series of interviews that we are conducting. Recognizing that the individuals with whom we will speak have different areas of expertise, we have organized the extensive set of questions into a smaller number of topical categories. While we welcome your responses to as many questions as you would like to address, we also expect that some participants will choose to focus on just a few categories that align most closely to their areas of expertise. In the following, we first briefly introduce the categories into which the questions have been divided. We then enumerate the specific questions within each category in turn.

119 Categories of Questions • Scope – Broad Policy Considerations. What potential system policy goals should be considered in the trials? Which road user groups should be included? • Scope – Scale, Geographic Coverage, and Duration. How large should the trials be, and how long should they last? How many states should participate in the trials? • Scope – Specific Goals of the Trials. What key issues – technology considerations, institutional structure, implementation and phase-in issues, and user acceptance – should the trials be designed to illumine? • Institutional – Federal Leadership and Stakeholder Participation. Who should organize and oversee the trials, and how should stakeholder input be incorporated? • Institutional – Organization and Management of the Trials. Should the trials be centrally organized and carefully coordinated to achieve particular outcomes, or should there be numerous, independent trials to examine potentially fruitful variations? Who should be eligible to conduct individual trials? • Institutional – Funding Allocation. Through what program(s) (new or existing) should the trials be funded? Should the federal government fully fund the trials or look for matching funds? On what basis should funding decisions be made? • Participation – State and Local Involvement. What is the appropriate role for various state and local agencies? Under what circumstances would enabling state legislation be required to participate in the trials? • Participation – Private Sector Involvement. How can the trials be structured to encourage multiple vendors to participate in the development and provision of competing metering, data transfer, fee calculation, and collection options? Is there a role for the participation of insurers (pay-as-you-drive insurance)? Auto manufacturers? Other motorist data-related services? • Participation – Trial Participants. How can individual drivers be enticed to participate in the trials? Are there particular user groups to target? What educational and outreach activities should accompany participation in the trials? • Implementation – Cost Estimates. Based on prior VMT-fee system trials that have already been conducted or are underway, how can we estimate, with some accuracy, the amount of funding necessary to support the needed trials? • Implementation – Detailed Structure. What standards (e.g., for communications protocols) might be developed to facilitate the participation of multiple vendors? How can the trials be structured to address such considerations as the accuracy of metering equipment and billing statements, the effectiveness of enforcement mechanisms and auditing, issues that might arise when phasing in a new VMT-fee system, and options for collecting road use charges from foreign visitors traveling in their own vehicles? • Other. Any additional issues that should receive consideration?

120 1. Scoping Questions – Broad Policy Considerations 1.1. Should the trials only include metering options that can track all miles of travel, or should they also include the possibility of assessing fees on just a subset of the road network (e.g., RFID tolling on all freeways and major roads)? 1.2. Should the trials focus on passenger vehicles, trucks, or both? 1.3. What pricing structures / policy goals should the trials include? Which are essential? Which are optional? o Flat fees (raise revenue) o Allocation of fees by jurisdiction of travel (geographic equity) o Fees that vary by time and location of travel (congestion) o Fees that vary by vehicle weight and road class (road damages) o Fees that vary by emissions characteristics (environment) 2. Scoping Questions – Scale, Geographic Coverage, and Duration of Trials 2.1. How much should the federal government be prepared to invest in trials (point of reference: federal excise taxes on gasoline and diesel yield approximately $35 billion each year)? 2.2. How many participants should be involved in the trials? 2.3. What are the most important factors (choose one or more) in determining the appropriate number of participants? o Testing the feasibility and/or cost of certain implementation options at scale o Gathering and assessing data on participant perceptions of implementation options and fee structures o Building public awareness of (and ideally support for) distance-based user fees 2.4. Should the trials seek to involve participants in all states or, if not, in multiple adjacent states? 2.5. How long should the trials last? 3. Scoping Questions – Specific Goals of the Trials 3.1. Among the technical issues that the trials might be structured to address, which (choose one or more) should have the highest priority? o Alternate metering configurations with different metering capabilities

121 o Alternate collection mechanisms (e.g., pay-at-the-pump, cellular transmission to a back office, a debit card system), potentially operated in parallel o Alternate means of protecting privacy o Alternate enforcement mechanisms o An “open systems” technology platform approach, including relevant standards and certifications o Potential use of travel data to support other transportation goals (e.g. calibrating regional transportation demand models, providing real-time traffic congestion data, etc.) o Others? 3.2. Among the institutional, organizational, and public-private sector issues that the trials might be structured to address, which (choose one or more) should have the highest priority? o Actual collection and apportionment of revenue (vs. simulated collection) o Simultaneous collection and apportionment of federal and state/local road use fees o Alternate collection systems for automobiles and trucks o Alternate institutional configurations of the billing process (e.g., publicly administered, administered by a single private vendor, administered by multiple private vendors) o Competition among multiple technology vendors within the same trial o Others? 3.3. Among the range of implementation and phase-in issues that the trials might be structured to address, which (choose one or more) should have the highest priority? o Integration with existing toll systems o Different classes of vehicles (e.g., older vehicles without OBD II port) o Charging foreign visitors o Transition issues (e.g., avoiding double payment with fuel taxes) o Incentives for voluntary adoption to speed up the transition period (e.g., value-added features, relation of VMT fees to other fees/taxes) o Others? 3.4. Among the issues related to user perceptions and acceptance that the trials might be structured to address, which (choose one or more) should have the highest priority? o User understanding of and support for distance-based user fees o User response to alternate fee structures o User response to alternate mechanisms for protecting privacy

122 o User response with respect to privacy vs. auditability to audit o User response to choice of value-added features on OBU o Others? 4. Institutional Questions – Federal Leadership and Stakeholder Participation 4.1. What entity should oversee the trials? Should this role be assigned to an existing entity, or should a new entity be created to oversee the trials and conduct other activities related to planning the potential transition to mileage-based user fees (e.g., developing agreed-upon policy goals, funding needed analytic studies and research and development activities, organizing public education and outreach efforts)? 4.2. If a new entity is created to oversee the trials (and possibly other related activities), what form should it take? A new position or unit within DOT or FHWA? A joint effort among several departments (e.g., Transportation and Treasury)? An appointed commission to oversee a federal program? 4.3. To what extent should non-federal stakeholders (states, local jurisdictions, industry, advocacy organizations) be able to participate and provide input into the planning, organization, and structure of the trials? How should this interaction be structured or enabled? 5. Institutional Questions – Organization and Management of Trials 5.1. How should the trials be organized, managed, and coordinated? o A centrally organized and highly coordinated set of trials with a careful research design to guarantee that all relevant issues will be addressed within the trials o A loosely organized set of independently operated trials, with the goal of fostering state and local innovation o Some combination of the above; e.g., a larger set of highly organized trials to examine critical issues along with smaller independent trials to consider interesting and potentially fruitful variations 5.2. Who should conduct (or be eligible to conduct) the trials? FHWA? States? MPOs? University research centers? Private firms or consortia? On what criteria should such a decision be based? o Credibility o Cost-effectiveness o Capacity building

123 6. Institutional Questions – Funding Allocation 6.1 Should funding be channeled through an existing program, or should a new program be created? 6.2. Should the federal government fund trials in their entirety or look for state or local matching funds? 6.3. How should funding for the trials be allocated or awarded? In the ideal? To be politically feasible? o Earmarks o Competitive awards o Proportional allocation to states based on population or other criteria (with state participation being viewed as optional) 6.4. If competitively awarded, should there be a very specific list of technical approaches and pricing structures that applicants must pursue (to foster progress towards implementation), or should the competition be more open-ended (to allow for continued exploration and innovation)? 6.5. If competitively awarded, what criteria (choose one or more) should receive the highest priority in the evaluation of proposal submissions? o Application of state, and possibly local, road use fees in addition to federal fees? o More controversial forms of user fees, such as congestion tolls? o Addition of “value-added” features such as PAYD insurance or automated payment of parking charges? o Others? 7. Participation Questions – State and Local Involvement 7.1. If states choose to participate in the trials, what are the appropriate (or helpful) roles for state revenue agencies, DOTs, DMV/MVAs, and MPOs? 7.2. If states choose to participate in the trials, under what circumstances might enabling state legislation be required? How much lead time might be required to develop and pass such legislation? 8. Participation Questions – Private Sector Involvement 8.1. If desired, how can the trials be structured to allow and encourage multiple vendors to participate in the provision of competing metering technologies?

124 8.2. If desired, how can the trials be structured to allow and encourage multiple vendors to participate in the provision of competing collections/billing/back office approaches? Should the government provide a default option? 8.3. If desired, how can the trials be structured to allow and encourage auto insurers to include PAYD insurance within the trials? 8.4. Should auto manufacturers be involved? If so, in what capacity? 9. Participation Questions – Trial Participants 9.1. What strategies or enticements can be used to encourage voluntary participation? 9.2. Are there particular groups of users or vehicle classes (choose one or more) that would be helpful to include in the testing? For example: o Electric vehicles o Older vehicles without an OBD II port o Rental fleets o Truck fleets o Government fleets o Insurance companies that want to explore PAYD insurance options 9.3. What educational activities should accompany participation in the trials, before, during, and after? 10. Implementation Questions – Cost Estimates 10.1. From prior trials and program implementations, what have we learned about how much the trials might cost based on such factors as: o Number of participants (cost of in-vehicle technology, installation, billing or simulated billing, etc.) o Any needed supporting infrastructure (e.g., RFID readers at fueling stations, in the pay- at-the-pump model, or gantry-mounted RFID readers and ANPR cameras for enforcement) o Back-office functionality o Duration of the trials o Associated education and outreach activities o Management of the trials and analysis of the results o Any media and public relations efforts related to the trials o Other factors

125 11. Implementation Questions – Detailed Structure 11.1. If it is intended that multiple vendors have the opportunity to provide competing metering mechanisms, should the federal government endorse a set of standards related to minimum metering capabilities and communications protocols to which vendors would need to adhere? If so, who might logically take the lead in developing these standards? 11.2. How can the trials be structured to test the accuracy of the metering equipment (or might this instead be evaluated through separate tests prior to the trials)? 11.3. How can the trials be structured to test the accuracy of billing statements? 11.4. How can the trials be structured to test the effectiveness and user perceptions of alternate strategies for protecting the privacy of travel data (e.g., sending aggregated data vs. all travel data, trusted third party, data encryption)? 11.5. How, if desired, can the trials be structured to test the effectiveness of proposed enforcement options in terms of detecting/preventing fraud or evasion (e.g., promise rewards to those who can identify ways to cheat the system)? 11.6. How, if desired, can the trials be structured to evaluate options for charging foreign vehicles lacking any required metering equipment? 11.7. How, if desired, can the trials be structured to evaluate the potential use of travel data to support other transportation goals (e.g., real-time traffic flow data) and user willingness to allow such use of data? 11.8. How, if desired, can the trials be structured to evaluate additional issues related to managing the transition to VMT fees? o Strategies to promote voluntary adoption of metering equipment o Managing parallel payment options (i.e., VMT fees and fuel taxes) o Demonstrating a transition strategy 12. Other Questions 12.1. Beyond the questions listed above, are there additional issues or concerns that should be considered?