Oregon’s Key Policy Body on Road Funding Alternatives Recommends Expansion of OReGO to a Mandate in 2025

Oregon’s Key Policy Body on Road Funding Alternatives Recommends Expansion of OReGO to a Mandate in 2025 Image

Reston, VA — September 27, 2016 — Long a key policy body on road funding alternatives, Oregon’s Road User Fee Task Force (RFUTF) took bold action to recommend a substantial mandatory road usage charge to the state legislature. Following the successful launch of OReGO, the state’s voluntary per-mile charge program, in July 2015, the RUFTF embarked upon a year-long study to determine the viability of a mandatory application to a large number of light vehicles. At its September 2016 meeting, the task force determined that sufficient progress had occurred with the OReGO for the state to proceed with a mandatory application.

The financial and economic model prepared by D’Artagnan Consulting proved critical to the success of the analytical process leading to the RUFTF recommendation. “Thanks to the economic model developed by D’Artagnan, Oregon’s Road User Fee Task Force was able to make informed policy decisions and advance a substantial expansion of our RUC initiative to the legislative level,” said Vicki Berger, Chair of the Road User Fee Task Force. Click HERE to access the ODOT press release.

Using a financial and economic model developed by D’Artagnan, the task force developed six options for a mandatory program, evaluating each for financial viability. The model accounted for administrative costs and revenue generation over several decades based upon projections supplied by the Oregon Department of Transportation. ODOT’s economists project that in 2020, the state’s fuel tax will enter a period of steady and steep decline. Since Oregon relies heavily upon the fuel tax for road revenues and maintenance of the road network, the task force recognized that a broad-based alternative must replace fuel tax and proposed a road usage charge for this purpose.

By unanimous vote of members of both political parties, the task force adopted a motion by Craig Campbell of AAA Oregon-Idaho to apply a per-mile charge to all new vehicles with a fuel efficiency rating of 20 miles per gallon or higher beginning in 2025. Given that the model predicts that nearly one million vehicles will enter the program between 2025 and 2030, the RUFTF wanted to give the Oregon DOT adequate time to prepare for the huge influx of vehicles into OReGO. Task Force member and Oregon Senator Chuck Thomsen noted that most of the current legislature will have left office by the time the mandate takes effect.

To keep OReGO at-the-ready for mandate status, the task force recommends that OReGo maintain its voluntary application to light vehicles until 2025, but with removal of the 5,000 vehicle cap. RUFTF also recommends that Oregon DMV provide an opportunity for people registering light vehicles to volunteer for OReGO as part of the process in an effort to bump the level of participation.