Oklahoma transportation task force tackles long-term funding solutions

The future of transportation revenue collection in Oklahoma could include a vehicle-miles-traveled tax.

The state’s 20-cent fuel tax rate is the single largest source of revenue for transportation in Oklahoma. The rate consists of a 19-cent per gallon tax on gas and diesel purchases. A special assessment fee of one penny also is collected on each gallon purchased.

Oklahoma’s fuel tax accounts for $583 million annually for transportation purposes.

Funding needs for the future

Born from legislation enacted in 2021, a Road User Charge Task Force met during the past year to address the state’s transportation funding needs for the future.

The Oklahoma Department of Transportation has submitted to state lawmakers the 42-page report on alternative options for transportation funding. The agency used results from a pay-per-mile pilot program made up of 445 participants from around the state who logged more than 1 million miles over the past year.

Dubbed Fair Miles Oklahoma, the research program was tasked with addressing “the impending decrease in the effectiveness and sustainability” of the state fuel tax.

The 15-member panel noted that “the ongoing increase in fuel efficiency is expected to decrease available fuel tax funds for Oklahoma’s transportation infrastructure maintenance and future innovation.”

Specifically, the group reported that fuel tax revenue is forecast to have a $7.86 billion shortfall by 2050.

Results from the Fair Miles Oklahoma pilot project have been touted by the group to provide critical data to assist the Legislature as it decides how to fund future maintenance and improvements in the state’s transportation infrastructure, including roads and bridges.

Pursuit to move away from fuel tax collection

Participants of the pilot program began reporting their monthly mileage in May 2023. ODOT reported that overall, participants found the pay-per-mile funding model to be fairer than the current fuel tax model.

A summary of the legislative report states that the increase in fuel economy has eroded motor fuel taxes. The pay-per-mile format is touted as a stable transportation revenue source.

The summary adds that fees can be tied to weight/class of vehicle, fuel economy/source, class of road, time of day and congestion.

State trucking association voices concern

Jim Newport of the Oklahoma Trucking Association urged caution about switching from current revenue sources.

He said during a recent group meeting that a pay-per-mile or vehicle-miles-traveled option “is expensive, inefficient, intrusive and carries unnecessary risk compared to applying a diesel gallon equivalent to other fuel sources.”

Newport added the current tax collection system for fossil fuels is inexpensive, convenient and clean. He suggested taxing other fuel sources and increasing fossil fuel tax rates.

Temporary fixes

The take force reported there are multiple options that would assist in providing “a bridge for maintaining and safeguarding transportation funding” with current road user taxes and fees until a permanent replacement for fuel tax revenues is implemented.

One option would be to fully fund the road fund with existing road user taxes and fees. Another would be to increase and index the state fuel tax.

The Legislature can use the information provided by the task force to help inform itself on options to address transportation funding. Its regular session will begin next month. LL

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