The Intersection of Urban Form and Mileage Fees: Findings from the Oregon Road User Fee Pilot Program

University Transportation Centers Program2011PDFResearch PaperGuo, ZhanWeinstein Agrawal, AshaDill, JenniferQuirk, MeganReese, MelissaCalifornia. Department of TransportationUnited States. Department of Transportation. Research and Innovative Technology AdministrationMineta Transportation InstituteOregonPortland (Oregon)Vehicle miles of travelTaxationLand useCongestion pricingFinancingMileage-based user feesMTI Report 10-04CA-MTI-10-2909DTRT07-G-0054Final ReportThis report analyzes data from the 2006-2007 Oregon Road User Fee Pilot Program to assess if and how urban form variables correlate with travel behavior changes that participants made in response to the mileage fee program. The study tested the impact of two fee structures, a variable charge and a flat rate, on seven types of vehicle miles traveled (VMT), and finds that charging a noticeably higher fee for driving in congested conditions can successfully motivate households to reduce their VMT in those times and places where congestion is most a problem. Households in both traditional (mixed use, dense, transit-accessible) and suburban (single-use, low density) neighborhoods will likely reduce their peak-hour and overall travel under a charging scheme that charges a high-rate for peak-hour travel, though households in the traditional neighborhoods will do so more. It also finds that a mileage fee program that charges a high rate during the peak hour is likely to strengthen the underlying influence of urban form on travel behavior. In other words, land use probably will matter more to transportation planning if the nation shifts to a new paradigm of mileage-based financing and pricing system, especially one that charges higher rates during peak hours. This finding suggests that switching from fuel taxes to mileage taxes would strengthen the option to use land-use planning as a policy tool to shift some travel from solo driving trips to more sustainable modes. For policymakers designing a mileage fee, this finding about the link between land-use patterns and travel behavior in response to a mileage fee implies that program designers will need to carefully consider both current and future land-use patterns when estimating the likely revenues collected from mileage fees and also the impact the fees could have on congestion levels. Finally, the research also reveals that decisions about when and how mileage fees are paid could significantly affect a household\u2019s response to a mileage fee program. In the Portland pilot program, where participants paid the fees out of a so-called \u201cendowment account\u201d established for them by the Oregon DOT rather than with their own money, household VMT actually increased when participants switched from paying the gas tax to paying the mileage fee. This result is the opposite of expectations. One possible explanation is that paying the mileage fees once a month, instead of paying the gas tax at each visit to the pump, may have encouraged households to drive more by reducing the gas price at the pump.136