Miles-Driven Tax Study OKd by RI Senate

The Rhode Island Senate is looking into the possibility of taxing motorists for miles driven, either instead of, or on top of, gallons of gas purchased taxes. Here's more from the RI General Assembly…

STATE HOUSE – Across the nation and here in Rhode Island, as vehicles' fuel economy has increased, gas taxes have been able to generate the money necessary to maintain roadways, bridges and the Rhode Island Public Transit Authority.

Rhode Island will become the latest state to look into switching to a tax system that charges drivers based on the number of miles driven instead of – or possibly in addition to – gallons of gas purchased, under legislation sponsored by Sen. Joshua Miller and approved by the Senate today.

The legislation (2010-S 2247A) would create a state commission that would study whether it would be feasible and wise for Rhode Island to replace or augment its current gasoline tax with a miles-traveled tax.

“Gasoline taxes, which are charged per gallon of gas purchased, are a volatile revenue source since people conserve more when gas prices increase, and the state has no control over the fluctuation of gas prices. Also, when high gas prices cause drivers to cut back, RIPTA suffers financially on several levels, because it gets less gas tax revenue while it faces the same high gas prices as everyone else, and it experiences greater demand for its services. We saw this play out recently when gas hit $4 a gallon.” said Senator Miller (D-Dist. 28, Cranston, Warwick). “We need to change the system to encourage the conservation of natural resources while raising the revenue necessary to maintain roads and public transportation.”

  The legislation creates a 15-member commission that would include three senators, three representatives, designees from the Department of Transportation, the Division of Taxation, the Division of Motor Vehicles, RIPTA and five members of the general public.

The commission would be charged with thoroughly examining whether Rhode Island could and should replace or supplement its gasoline tax with a miles-traveled tax. The commission is asked to study experiments and trials of miles-traveled taxes in other jurisdictions, studies of possible models created by federal and state departments of transportation and the American Association of State Highway Transportation Officials and projections of miles-traveled taxes set at varying levels and under a variety of conditions. The commission is also asked to consider how the state would determine miles driven by a person while protecting the individual's privacy, as well as the community, social and environmental benefits and detriments if a miles-traveled tax were instituted in place of or in addition to the gas tax.

The commission would have one year from the enactment of the bill to issue a report to the General Assembly on its findings.

 “The state has a responsibility to safely maintain its roadways, and the gas tax is increasingly becoming an ineffective means of raising the money we need to do that. Some form of a miles-traveled tax might be a good alternative, and I look forward to seeing what this commission can learn about it,” said Senator Miller.

The legislation will now advance to the House, where Rep. Arthur Handy (D-Dist. 18, Cranston) is sponsoring identical legislation (2010-H 7845).