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61 7. PRELIMINARY ASSESSMENT OF VMT-FEE OPTIONS The prior chapter briefly outlined the functional requirements of a VMT-fee system and described the core options for metering mileage, collecting revenue, and verifying compliance. This chapter considers the likely ways in which these individual components might be combined within a national system for VMT fees and evaluate, at a high level, the relative strengths and limitations of the alternate configurations. The goal is to screen for the most promising options, which are then examined in greater detail in the next chapter. While there are numerous ways to configure a VMT system, some are more promising than others. Rather than examining exhaustively every possible combination of technologies, this research was focused on nine basic configurations that (a) have already been implemented or studied, (b) have been suggested as potential options by elected officials interested as possible ways to implement VMT fees, or (c) have emerged as promising candidates based on our research. The nine options are as follows: ⢠Self-reported odometer readings ⢠Periodic odometer inspections ⢠Assumed annual mileage with odometer inspection option ⢠Mileage fees based on fuel consumption ⢠OBD II metering device ⢠OBD II / cellular metering device ⢠Coarse-resolution GPS metering device ⢠High-resolution GSP metering device ⢠DSRC-based tolling on a partial road network Note that there is some flexibility within these options; for instance, multiple collection mechanisms would be possible for any of the latter four options â those involving an OBU. Each of these options is examined more closely below. The following discussion briefly describes how the system might work, identifies key strengths and limitations, and comments upon challenging tasks required for implementation. Based on this high level assessment, the research team judged whether (a) the option is worthy of further consideration as a primary means of levying national VMT fees in the near term, (b) the option might serve as a parallel fee mechanism for vehicles not covered by the primary system, (c) the option could be added to extend the capabilities of the primary system, or (d) the option might serve the goal of providing a more robust and sustainable VMT-based revenue system over the longer term â i.e., a system with very flexible metering capabilities to accommodate a range of pricing and policy options. The following criteria were considered in assessing the potential utility as a primary near-term metering mechanism: ⢠Full road network metering. The explicit goal of this project is to identify options for levying fees based on VMT. To capture all VMT, the system must meter mileage across the entire road network.
62 ⢠Cost vs. metering capabilities. Given that a principal goal of the envisioned transition to VMT fees is to preserve or enhance revenue, any system that offers only limited metering capabilities should also be relatively inexpensive to implement and operate. Otherwise, the per-mile fees would need to be much higher in proportion to existing fuel taxes to simply maintain existing revenue. By the same token, any system that entails higher costs should provide flexible pricing options (e.g., varying the rate by time and location of travel) that would make it possible to increase total revenue without significantly increasing the base per-mile rate. ⢠Enforceability. For a host of reasons, ranging from revenue goals to perceptions of equity among law abiding citizens (Short 2004), the system must allow for at least reasonably effective enforcement activities. ⢠Minimal required state support. Based on the state interviews reported in Chapter 4, it was evident that not all states would be eager or willing to exert significant administrative effort to support the transition to a national system of VMT fees. Any option that requires (as opposed to allows) concerted effort on the part of states, therefore, is unlikely to succeed, at least in the near term. ⢠Minimal burden on users. Gaining public acceptance for the transition from fuel taxes to VMT fees will likely be difficult in its own right. Increasing the burden on users â for instance, by requiring regular odometer inspections â will make this even more difficult. 7.1. Self-Reported Odometer Readings For this option, drivers would report their current mileage each year as part of the annual registration process. The state DMV or MVA would then assess a corresponding mileage fee, which would be added to the base vehicle registration fee (if paying the full amount in a lump sum proved to be burdensome for some drivers, an option of paying the fee in twelve monthly installments could be provided). The state would then pass along the mileage fee component, minus some administrative charge, to the federal government. Key Strengths. There are several strengths to this approach. First and foremost, it would be very low cost, with no in-vehicle equipment requirements and relatively low collections cost. Another benefit is that this option would not create privacy concerns. Key Weaknesses. The main drawback of this approach is that it would be extremely difficult to provide effective enforcement unless routine odometer inspections were required (Whitty and Svadlenak 2009). A driver might, for instance, repeatedly underreport mileage over a period of some years and then scrap the vehicle at the end of that period â this would be very difficult to prevent. This option would also require that all states track vehicle odometer data â many do not currently store this information in their registration systems â and update their billing systems. One of the observations arising from our interviews with state officials, discussed in Chapter 4, was that many state registration databases can be described as âfragileâ legacy systems for which even simple changes to data fields or billing processes may be difficult to achieve. Also, many states allow multi-year registration options, meaning that either they would have to change their processes to incorporate annual readings or drivers would be asked to pay several yearsâ worth of
63 mileage in a lump sum. Finally, this option offers limited metering capabilities; rates might vary by relevant vehicle characteristics, but not by time or location of travel. Implementation Challenges. The most significant implementation task would be for states to update their vehicle registration and billing systems. All states would need to participate. Summary Assessment. Because this option would pose difficult and likely intractable enforcement challenges, it is not suggested for further consideration. 7.2. Annual Odometer Inspections Similar to the prior option, the key distinction here is that drivers would submit to periodic (likely annual) odometer readings at certified stations as the basis for assessing mileage fees. The odometer readings could be conducted either by a public agency, such as a state DMV or MVA, or contracted to authorized private stations. Here again, fees would be added to the base registration charge, and states would then remit the federal share of VMT fees to the Treasury Department. Key Strengths. The principle advantage of this option is that no additional in-vehicle equipment would be required. Additionally, this option does not raise privacy concerns. Key Weaknesses. This option faces a number of limitations. The most important of these is the significant operational cost that would be required to conduct odometer readings. To employ this option and preserve existing revenue, the per-mile fee would need to be proportionately much higher than existing fuel taxes. It would also require that all states develop a network (publicly or privately operated) of odometer check stations. Although about two-thirds of the states already have such infrastructure in place (e.g., to check emissions equipment), the inspections are often conducted less frequently than once per year. Additionally, state vehicle registration databases would again need to be updated to track and bill for mileage. The pricing flexibility under this option (i.e., the ability to account for time or location of travel) remains limited, and it would not be possible to precisely allocate revenue by jurisdiction. The need to conduct periodic odometer readings would increase the burden on many road users. Finally, though enforcement would be easier than under the self-reporting model, it is still possible that vehicle owners could find ways to tamper with their odometers. Implementation Challenges. The most significant near term tasks would be for states that do not currently conduct vehicle inspections to develop and deploy the necessary infrastructure and for all states to adapt their registration processes as needed. Here again, all states would need to participate, and some may be reluctant to take on these tasks. Summary Assessment. This option is not suggested as the principal metering platform for three reasons: (a) it would be expensive to operate while offering limited metering capabilities, (b) it would require significant state involvement, and (c) it would increase the burden on users. This option could, however, be considered as a parallel fee system for vehicle classes not covered by the main metering approach, provided that the numbers of such vehicles are small (e.g., in a pay- at-the-pump system, electric vehicles might be required to pay fees based on odometer readings).
64 7.3. Assumed Annual Mileage with Optional Odometer Checks With this approach, road users would be assessed an annual VMT fee based on the estimated mileage for the vehicle class (e.g., passenger vehicles vs. commercial trucks). Road users that travel significantly less than the assumed amount could submit to annual odometer readings to qualify for a reduced fee based on actual miles of travel, while users that travel more would simply choose to pay the estimated mileage charge. As with the previous option involving odometer inspections, states would still need to provide the infrastructure for road users that choose to have their odometers read, and they would likewise need to modify their vehicle registration systems to accommodate this new form of charging. VMT fees, once collected, would be remitted to the federal government. Key Strengths. Here again, no additional in-vehicle equipment would be required, and this mechanism would not raise privacy concerns. Additionally, the cost of administration would be less than under the prior odometer option since many users would choose simply to pay the estimated mileage charge rather than having their odometer checked each year. Key Limitations. This option also faces a range of limitations and concerns. As with the prior odometer option, the pricing flexibility is limited to mileage and vehicle characteristics, and it is not possible to apportion revenue among jurisdictions with a high degree of accuracy. States would still need to develop a network of odometer reading stations for those users wishing to qualify for lower feed based on reduced mileage, and they would need to update their vehicle registration databases and billing systems as well. The potential for odometer fraud would remain as a concern as well. It is also worth noting that any drivers wishing to qualify for a reduced rate would need to have their odometers checked both before and after the year in question. Unique to this odometer option, there could be equity concerns as well. Specifically, while vehicle owners that travel less than the assumed amount would likely have their odometers read to qualify for a reduced total fee, they would still end up paying the assumed base rate on a per-mile basis. In contrast, drivers that travel far in excess of the assumed annual mileage would simply choose to pay the fixed total fee, resulting in a much lower charge on a per-mile basis. In other words, those who drive less would tend to subsidize those who drive more. Given our understanding of the factors that influence travel behavior, this would tend to benefit wealthier drivers at the expense of poorer drivers, and suburban and rural drivers at the expense of urban drivers (Pisarski, 2006). Implementation Challenges. The obstacles here are the same as for the prior odometer-based option: the need for states that do not currently conduct vehicle inspections to develop and deploy the necessary infrastructure and for all states to adapt their registration processes as needed. Summary Assessment. This option is likewise not suggested as the main metering approach. Though not all drivers would choose to have their odometers read â lowering both administrative costs and user burdens â all states would still need to set up the necessary infrastructure for odometer stations. Additionally, this option raises equity concerns in that high-mileage drivers would end up paying lower per-mile rates than low mileage drivers. That said, this option could be considered as a parallel fee system for vehicle classes not covered by the main metering mechanism, as the number of such vehicles would presumably be quite small.
65 7.4. Fuel Consumption-Based Mileage Estimates Under this approach, as described in the prior chapter, fuel consumption would serve as the basis for estimating travel distance. All vehicles would be equipped with some form of AVI (likely an RFID tag embedded in the license plate or registration sticker). When a vehicle visits a gas station to purchase fuel, electronic readers installed at the pump would detect the vehicle ID and use this information to determine the vehicleâs fuel-economy rating (and, optionally, other characteristics such as weight or emissions class) based on the make and model. The expected mileage could then be estimated based on the number of gallons purchased. The corresponding charge could then be added to the fuel purchase price, while fuel taxes (already paid at the wholesaler level and therefore built into the retail price) would be subtracted. Vehicles not yet equipped with an AVI device (including foreign vehicles) would continue to pay the existing fuel taxes rather than mileage charges. The administration for this option would involve expanding the existing fuel tax collection system to include fuel retailers along with wholesalers. Specifically, it would be necessary to account for the difference between fuel taxes (paid at the wholesale level) and mileage fees (collected at the retail level) and interact with fuel retailers to either collect or refund the difference. Key Strengths. There are several important advantages to this approach. First, administration should be less demanding than for many other options, requiring interaction with fuel retailers (numbering in the hundreds of thousands) as opposed to vehicle owners (numbering in the hundreds of millions). Second, the cost of equipping vehicles with electronic identifiers could be quite low (RFID tags can cost on the order of a few cents per unit). Third, vehicles that are not equipped with the required identifier can simply continue to pay the existing fuel tax. This means that (a) the system can be phased in over time, (b) foreign vehicles can continue to pay their share of road use costs via the gas tax, and (c) enforcement should not be a major concern â vehicles, when refueling, must either pay mileage charges or gas taxes. Key Limitations. There are several limitations for this approach as well. The mileage estimates may be inaccurate depending on travel conditions (e.g., vehicles stuck in traffic will experience reduced fuel economy). Pricing flexibility is rather limited, and there is no way to accurately apportion revenue among jurisdictions. It would also be necessary to determine to find the right avenue for equipping all vehicles with the AVI device. One of the project panel members noted, for instance, that enabling state legislation would be required to include an RFID tag within a license plate or registration sticker. There may also be some privacy concerns associated with the use of RFID or other AVI options. Additionally, vehicles that do not require conventional fuel (e.g., electric cars) would require a parallel mechanism for assessing VMT fees, and the share of such vehicles is expected to grow in the coming years. Considering that there are about 160,000 retail fueling stations in the country (National Petroleum News 2008), the cost of installing the needed equipment to detect vehicle identification would be significant, and it is likely that some station owners would not welcome this imposition. Depending on the configuration of the station equipment, there may also be challenges for rural stations that lack internet connectivity. Finally, the current system for administering fuel tax collections would need to be expanded to encompass all retailers, a non-trivial endeavor. Implementation Challenges. The three main challenges include equipping all vehicles with some form of electronic identification, equipping all retail fuel stations with the necessary
66 devices to detect vehicle identification and adjust the mileage fee added to the fuel bill accordingly, and adapting the current fuel tax collection system to accommodate retail stations. Given that RFID tags are inexpensive, the second of these is likely to account for the largest share of capital costs, while the third represents a moderately difficult administrative task. Summary Assessment. This option is suggested for further consideration as a core mechanism for implementing VMT fees over the near term. Not withstanding its limitations, the advantages of this approach are significant â most notably the very low costs for vehicle equipment, the need to administer a much smaller number of entities (all fuel stations vs. all vehicle owners), and the ability to continue to apply existing fuel taxes to vehicles lacking the necessary electronic identification (e.g., foreign vehicles). This option could also serve as a parallel payment mechanism. For instance, if the OBD II option were selected as the principal mechanism for implementing VMT fees, the fuel-consumption based option could serve as a parallel charge mechanism for pre-1996 cars (which lack the OBD II port). While this would seem to involve a significant cost to handle a small (by 2015) and shrinking share of vehicles on the road, equipping all fuel stations with the necessary communications equipment could make it possible to (a) allow conventionally-fueled vehicles with the OBD II port device to communicate mileage data and pay charges at the pump, (b) allow pre-1996 vehicles to pay estimated mileage charges at the pump based on their fuel economy, and (c) detect vehicles lacking electronic identification and levy fuel taxes instead of mileage charges. 7.5. OBD II-Based Mileage Metering For this approach, vehicles would be equipped with an on-board unit connected to the OBD II port, providing data on vehicle speed that can be used to compute travel distance. The per-mile fee could be modified, if desired, by vehicle characteristics such as weight, fuel economy, or emissions class. Fees could be collected either through the pay-at-the-pump model or via a central billing agency (while debit cards would also be possible, this option does not present the same privacy concerns that might motivate drivers to prefer this option). Key Strengths. One advantage of this approach is that the per-vehicle costs, though more expensive than simple RFID tags, should be low. In comparison to GPS-based systems, retrofitting existing vehicles with the technology is relatively easy, requiring a simple connection to the OBD II port. Some pay-as-you-drive insurance programs already utilize this approach, so the technology can be viewed as âprovenâ and off-the-shelf devices are available. In comparison to the fuel consumption approach, the mileage estimates, though still the result of a calculation, should be more accurate. Key Limitations. Here again the pricing flexibility is relatively limited, and it is not possible to accurately apportion miles by jurisdiction. Because the OBD II port is only available on vehicles manufactured after 1996, it would be necessary to establish a parallel charging mechanism for older vehicles (although by 2015 the share of such vehicles should be relatively small and will decline over time). Either of the options for collecting fees will entail at least moderate administrative cost and complexity. It will also be necessary to employ one or more options to ensure that drivers do not disable the OBU to avoid mileage charges (a recurrent theme for the options that involve an OBU).
67 Implementation Challenges. Several significant tasks would need to be accomplished for implementation. These include procuring the technology and retrofitting existing vehicles, either adapting an existing or developing a new administrative system for collecting and allocating the revenue, and deploying any additional infrastructure (e.g., vehicle check stations) to support system enforcement activities. Within the near term, these can be viewed as possible but challenging. Summary Assessment. From a cost perspective, this option would be similar (slightly cheaper, but roughly comparable) to the OBD II / cellular combination, while offering significantly reduced metering capability (no ability to determine the location of travel). It is thus not suggested for further consideration. 7.6. OBD II / Cellular-Based Mileage Metering Like the previous approach, this would rely on an on-board unit connected to the OBD II port to meter mileage. The OBU would also be equipped with cellular communications, and this would make it possible to determine the location of travel with enough accuracy to place the vehicle in a specific jurisdiction or zone (but not on a specific route). This configuration would thus make it possible to vary rates by vehicle characteristics, by jurisdiction, or by smaller geographic area (e.g., area-based congestion tolls in a dense urban district). The location data would also make it possible to accurately allocate mileage fees among multiple jurisdictions. To collect fees, it would be possible to set up the pay-at-the-pump model, develop a central billing agency, or develop a debit card system (for users concerned with privacy, as this approach meters travel by time and location). Key Strengths. Owing to the addition of cellular communications to the OBU, this option would be more expensive than the previous configuration. On the other hand, the cellular component would be used both to support communications and determine location. In comparison to the GPS options, this would result in fewer required components on the device and lower overall cost. Another strength is that this configuration would make it possible to determine the location of travel with enough accuracy to enable flexible pricing options, yet may not raise the same degree of privacy concerns that the public associates with GPS (the majority of citizens already own cell phones and carry them on a routine basis). However, without further study of public opinion it is difficult to know if this option would assuage privacy concerns. Key Limitations. The application of cellular technology for providing information about the location of travel remains to be demonstrated in practical field trials, so there is some technical risk with this option. The addition of cellular communications would also require a service contract, and this would add to the ongoing operational cost. Additionally, because the OBD II port is only available on vehicles manufactured after 1996, it would be necessary to establish a parallel charging mechanism for older vehicles. Any of the available options for transmitting and billing for mileage will entail at least moderate administrative complexity. Finally, here again it will be necessary to develop strategies for ensuring that a vehicle owner cannot disable the OBU to avoid mileage charges. Implementation Challenges. The first step under this option would be to conduct research and development activities to ensure that the technology can function as envisioned. Assuming that
68 the tests prove successful, it would then be necessary to procure the technology and retrofit the existing fleet, either adapt an existing or develop a new administrative system for collecting and allocating the revenue, and deploy any additional infrastructure needed to support enforcement activities. Summary Assessment. This option provides highly flexible pricing options. The per-vehicle cost would likely be lower than with GPS-enabled equipment, while public concerns over privacy may be reduced. This option is therefore suggested for further assessment, though further development efforts would be required to verify that the technical configuration works as expected (Donath et al. 2009). Should the option of paying VMT fees based on fuel consumption be implemented as the primary VMT system, this option could serve as a parallel payment mechanism for vehicles that do not run on conventional fuels (e.g., electric vehicles). Note that the metering capabilities are sufficiently flexible that this configuration could serve as both a short- and longer-term solution, perhaps obviating the need for a longer-term transition. 7.7. Coarse-Resolution GPS-Based Mileage Metering From the perspective of metering capabilities, this option, employed in the Oregon trials, is identical to the previous approach. The only difference is that the OBU would rely on a coarse- resolution GPS receiver, rather than cellular communications, to identify the jurisdiction or area of travel (GPS could also be used to measure travel distance â by interpolating between subsequent location points â or the OBU could include a connection to the OBD II port for this purpose). This configuration would also enable similar payment mechanisms, including the pay- at-the-pump model, cellular transmission of mileage data to a central billing agency, and pre- paid debit cards inserted into the OBU. Key Strengths. Like the prior option, this provides extremely flexible metering capabilities, enabling all but the determination of travel on specific routes. Depending on the adopted payment strategy (pay at the pump vs. central billing agency), it may be possible to omit cellular technology from the OBU, reducing the cost of the equipment and eliminating ongoing cellular service costs. A coarser-resolution GPS receiver would also be cheaper than higher-resolution GPS (e.g., national differential GPS). If GPS (rather than the OBD II port connection) were used to meter mileage, the equipment could work for all vehicles on the road. Finally, the inclusion of GPS would make âadd-onâ services such as in-vehicle navigation or emergency location possible, and this could increase the attractiveness of the in-vehicle equipment from the perspective of end users. Key Limitations. Because GPS requires connection to a power source as well as line-of-sight access to the sky (the device must either be mounted on the dash or include an antenna), the cost of installing the equipment will be higher than with the OBD-II port option. It is also not clear that the public appreciates the distinction between lower- and higher-resolution GPS, so the perception of privacy concerns may be difficult to overcome. It should be stressed that, from a technical perspective, it is absolutely possible to protect private data. It is just that convincing the public and press of this has thus far been difficult âit is impossible, from the perspective of drivers, to prove that private data is not being stored without their knowledge. Finally, here again it will be necessary to develop strategies for ensuring that a vehicle owner cannot disable the OBU to avoid mileage charges.
69 Implementation Challenges. The viability of this technology has already been demonstrated in the Oregon trials. Needed steps would therefore include procuring the technology and retrofitting the existing fleet, adapting an existing or developing a new administrative system for collecting and allocating the revenue, and deploying any additional infrastructure needed to support enforcement activities. Given current privacy concerns associated with GPS, it is clear that education and outreach to overcome this resistance would be imperative. Summary Assessment. This option provides flexible metering capabilities similar to the combination of an OBD II port connection and cellular communications. While the start up costs might be higher (due to potentially higher equipment costs and more challenging installation requirements), the ongoing operation costs could prove to be lower (given the potential of omitting cellular service for vehicles that pay at the pump). The main disadvantage with this option is the public perception that use of GPS will create the potential for privacy invasion. Even so, this option merits further consideration as a core metering mechanism, as there are a number of promising âopt-inâ strategies that could overcome privacy concerns. It could also provide a parallel payment option for any vehicles not covered by the primary mechanism (e.g., electric vehicles in the pay-at-the-pump model). Here again, the metering capabilities are sufficiently flexible that this configuration could serve as both a short- and longer-term solution, perhaps obviating the need for a longer term transition. 7.8. High-Resolution GPS-Based Mileage Metering This option is similar to the prior approach, but would rely on differential GPS for sufficient accuracy (i.e., accurate within one to two meters) to determine the specific route of travel (again, travel distance could be measured either by GPS or via a connection to the OBD II port). This would enable the greatest flexibility in pricing; per-mile rates could vary by vehicle characteristics, by jurisdiction, by area within jurisdictions, by route, and by time. The ability to meter by route may be most useful for heavy trucks, in that the damage caused by truck travel varies considerably depending on the engineering quality of the road. It would also make it possible, however, to develop facility-based congestion tolls for all vehicles without needing to install gantries. Similar payment options would be possible: paying at the pump, transmitting mileage data wirelessly to a central billing agency, or making use of pre-paid debit cards inserted into the OBU. Key Strengths. This option provides the greatest flexibility in pricing. Also, if an RFID-based pay-at-the-pump model were adopted, it would be possible to omit cellular technology from the technical configuration (at least for conventionally-fueled vehicles). If GPS (rather than the OBD II port connection) were used to meter mileage, the equipment could work for all vehicles on the road. Here again, the inclusion of GPS would make âadd-onâ services such as in-vehicle navigation or emergency location possible, and this could increase the attractiveness of the in- vehicle equipment from the perspective of end users. Key Limitations. High-resolution GPS is more expensive than the coarser-resolution variety, with differential GPS receivers costing hundreds of dollars. One would envision that the cost would come down considerably if scaled to several hundred million drivers, but this would still be the most expensive configuration on a per-vehicle basis. As with the previous GPS option,
70 installation requirements would be manually intensive, and this would also boost the per-vehicle cost. It would also be necessary to develop more precise digital road network maps to take advantage of the higher-accuracy GPS, likely entailing at least some expense. Privacy concerns would be acute, and considerable outreach would likely be necessary to ensure the public that their private travel data is sufficiently protected. Finally, it would again be necessary to develop strategies to prevent or dissuade users from tampering with the OBU. Implementation Challenges. Perhaps the two greatest obstacles to the near-term implementation of this approach are the high cost of retrofitting the existing fleet with the needed technology and overcoming current public concerns regarding privacy. Assuming that these can be accomplished, additional steps include procuring the technology and retrofitting the existing fleet, adapting an existing or developing a new administrative system for collecting and allocating the revenue, developing more accurate digital road network maps, and deploying any additional infrastructure needed to support enforcement activities. Summary Assessment. The additional metering flexibility of this option â determining location by route of travel â is likely, in the near term, to prove most useful for weight-distance truck tolling applications in which the per-mile rate would very by type of road (over the longer term, it would enable ubiquitous facility-based congestion tolls, applicable to all vehicles, but the public is unlikely to accept such a radical policy shift soon). Moreover, the cost structure of trucking operations would make it easier to amortize the required in-vehicle equipment, while the privacy concerns are less acute in an industry already subject to significant government regulation. This option is thus not suggested as a near-term platform for general purpose VMT fees, but rather as a near-term extension (for trucks) and possible longer-term transition for all other vehicles. 7.9. DSRC-Based Tolling on a Partial Road Network With this option, all vehicles would be equipped with AVI and gantries would be set up along the most heavily traveled segments of the road network to support facility-based tolls â either flat tolls or tolls that vary by time and location. This approach would not support tolling across the entire road network, as it would not be practical, let alone cost effective, to install gantries on lightly traveled road segments. As such, this would likely be used to augment, rather than replace, fuel tax revenue. The two most likely options for collecting payments would be to set up a central billing agency or use pre-paid debit cards inserted into the in-vehicle equipment. Key Strengths. The costs of in-vehicle equipment with this option would be low. Additionally, this would allow congestion tolling on the most heavily traveled corridors, which could raise considerable revenue. Key Limitations. Within the context of this study, the most important limitation is that this option would not support tolling on the entire road network, and thus would not constitute a true VMT fee. Additionally, the cost of installing a significant portion of the road network with gantries to detect vehicles and read their AVI devices would be considerable. It also appears unlikely that the public is ready to embrace full scale congestion pricing, which â from a revenue perspective â would be a key rationale for this approach. Because this approach would need to register the passage of vehicles at specific points on the road network, privacy concerns would
71 likely arise (though these could be overcome through the use of pre-paid debit cards or some form of âanonymousâ accounts made available to road users concerned with privacy). There could also be problems caused by traffic diverting from tolled routes to un-tolled routes. Finally, if this option were implemented by the federal government, if gantries were only installed on heavily traveled corridors, and if the resulting revenue were distributed among the states based on the current Highway Trust Fund allocation formula, predominantly urban states would end up subsidizing predominantly rural states. Implementation Challenges. Building the political support for tolling on a partial road network would be one of the main obstacles, particularly if the tolling would involve some form of congestion pricing. Beyond that, it would be necessary install to AVI devices on all vehicles, equip some portion of the road network with gantries, and develop a central billing agency to collect tolls (this could be done individually in each state, or at the national level). This could be possible in the short term, but certainly challenging. Summary Assessment. Given the limitations of this option â most importantly the fact that it would not meter mileage across the entire network â it is not suggested for further analysis as a core mechanism for implementing VMT fees over the near term. On the other hand, this approach could be used to extend the capabilities of alternate metering mechanisms. Specifically, for any approach that relies on AVI or an OBU to meter total VMT, gantries could be added at strategic locations to enable, for example, facility congestion tolls or cordon congestion tolls. 7.10. Summary of VMT-Fee Mechanism Assessments Table 7.1 summarizes our assessments regarding the potential suitability of each of the mechanisms as (a) a core metering option, (b) a parallel metering option for certain classes of vehicles, (c) a means of extending the metering capabilities of the core mechanism, and (d) a longer-term transition option. Table 7.1. Summary Assessment of VMT-Fee Mechanisms Metering Option Core Metering Option Parallel Metering Option Extended Metering Capabilities Longer- Term Transition Self-reported odometer Annual odometer inspection X Optional odometer inspection X Fuel-consumption estimates X X OBD II OBD II / cellular X X X Coarse-resolution GPS X X X High-resolution GPS X X DSRC tolling X
