Pay-by-the-mile?: New study looks at replacing state gas tax

More electric vehicles means less gas tax revenue to pay for Connecticut’s roads and bridges.

John Craven

Jun 30, 2023, 10:06 PM

Updated 296 days ago


Across Connecticut, thousands of cars will drive hundreds of miles this holiday weekend. Now, a new study is looking at whether to charge them for each mile they drive – instead of paying gas taxes.
“Uh, that doesn't really sound too good,” said Tremain Lawrence, of Manchester. “I mean, if it's the same price? Yeah, I guess.”
It's all because more electric vehicles means less gas tax revenue to pay for Connecticut’s roads and bridges.
“We need to look at something for those users who are using less fuel, or no fuel at all, to help contribute to the roads that they travel on,” said Connecticut Department of Transportation Commissioner Garrett Eucalitto.
The Connecticut Mileage-Based User Fee Study is being conducted by the Eastern Transportation Coalition, an independent group representing more than a dozen East Coast states. The study needs 90 more volunteers to track how many miles they drive through the end of this year.
Drivers will not be charged any money. Their miles are tracked through an odometer that attaches to their car’s computer system.
“I signed up,” said Eucalitto.
He insisted the study is only informational – and not another attempt to bring tolls to Connecticut.
“It is something that is a long-term study,” said Eucalitto. “It's not something that can be implemented tomorrow or the next five years.”
Electric vehicles don’t produce emissions, but they also don’t pay for road and bridge maintenance. States across the country are struggling to replace fuel tax revenue, projected to drop steeply in the 2030s as automakers phase-out internal combustion engines.
Three states – Virginia, Utah and Oregon – already charge mileage fees, but just as a pilot program. Most states are going a different route – charging EV owners higher registration fees.
But that could scare buyers away as states scramble to address climate change.
“If you want to cut down on the amount of gas cars that are moving through the road, why would you increase taxes or anything on EV cars?” asked Mario Carpanzano, a Tesla owner from Stamford.
One driver had another idea -- tax the electricity EVs use.
“I'll keep paying my gas taxes – ridiculous as it is – and they need to pay a charging tax,” said Carol Graham, a traveler from Maryland.
But Eucalitto said that won't work, because many electric car owners charge at home.
“They'd have to retrofit the meters to be able to differentiate between how much electricity are you drawing in and using to charge your vehicle, versus running your air conditioner,” he said.
A pay-by-the-mile scheme faces significant challenges.
First, how would the state keep up with a driver’s miles – and not charge them for trips outside of Connecticut? Also, how would DOT collect the tax from tens of thousands of out-of-state drivers?
Eucalitto believes any mileage fee would probably need to be imposed regionally, or even nationally. The Biden administration has set aside money to examine the options, he said.
Some possible options: Cars could eventually be equipped with mileage trackers or EZPass-style tags.
Drivers could also voluntarily report their miles. That’s the approach Connecticut is taking with a controversial new mileage fee for heavier trucks, which already log their miles, but the program has generated less revenue than projected.
A mileage fee was first considered in 2015, by former Gov. Dannel Malloy’s Transportation Finance Panel. But after fierce public resistance, state lawmakers rejected the idea. A 2017 law forbids DOT from using state funds to study mileage-based fees.
Eucalitto noted that Eastern Transportation Coalition, not the state of Connecticut, is conducting the study – using federal funds.
The deadline to sign up is July 19. You can apply here.
The study runs through December.

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