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ON THE LEVEL: Head of Reason Foundation sees future of road funding in tolling

Robert Poole (Photo courtesy of the Reason Foundation)

Robert Poole (Photo courtesy of the Reason Foundation)

Most think-tank pundits are well aware of the likelihood that their best recommendations are likely to take years, if not decades, to bear fruit.

So Robert Poole of the Reason Foundation, an organization that seeks to apply free-market answers to questions concerning public policy, enjoyed some unusually good fortune early in his career when he was able to see some of his work being put to practical use. In 1988, Poole released a paper discussing ways private financing could be used to help relieve congestion through the construction of toll lanes. Not long after, the state of California drew on those ideas in Orange County when building the 91 Express Lanes, which let drivers choose to pay a toll to avoid congestion on stretches of interstate that can be traveled free of charge.

Now as director of transportation policy at the Reason Foundation, Poole is as convinced as ever that the future of highway funding lies in tolling. But he’s also realistic about how long a shift away from the current heavy reliance on gas and diesel taxes is likely to take.

One big obstacle to overcome is the public’s general distaste for tolling.

“I think the states should are in a position to lead this process because state governments, believe it or not, are trusted more than the federal government,” Poole says. “And if we’re going to make a change like this, we should start with the people that voters and citizens feel better about and start with a visible problem.”

A push in favor of tolling is already coming in the form of decreased revenue from gas and diesel taxes. States’ highway budgets may have recently been put under strain by people avoiding the road and hunkering down at home to prevent the spread of the coronavirus. But that has only exacerbated a long-standing trend.

Year after year before the pandemic, increasing fuel efficiency had already been a drag on transportation revenue. Poole warns that further progress in that direction, along with the increasing popularity of electric cars, could result in a $54 billion a year shortfall in federal and state transportation revenue by 2050.

He recently sat down with The Daily Reporter to talk about how tolling offers a way out of this impasse and how governments might eventually be able to wean themselves off fuel taxes. (This article has been edited for clarity and brevity.)

The Daily Reporter: How unpopular is tolling among the public?

Poole: Now the consensus in the transportation-research community, 10 years ago, we said we need to charge per mile instead of per gallon. That’s the most sustainable way forward.

But the public is not very keen on it. In a synthesis of studies that came out a few years ago, only about 24% of the population seems to think this is a good idea.

Part of this is because the media has portrayed this as Big Brother in your car. As if it has to be done by GPS and if every mile you travel is minutely tracked. It seems like a big privacy intrusion Also, people don’t believe that this would replace the gas tax, they are suspicious of government. They think – oh yeah, sure – this will be just another tax.

I think state DOTs that have started trying to talk about this focus so much on revenue shortfalls. When people hear that, they start grabbing for their wallets and say, ‘No, no.’ So we really need to start figuring out how to how to do a better job of explaining this.

TDR: How do you go about that?

Poole: I think we need to create a better value proposition for the people who use highways, convince them that there’s something in this for them. That would mean beginning the transition with a better need justification. So first of all, I think we should fix all the shortcomings of the fuel tax, not just that it doesn’t apply to electric vehicles and it’s not keeping pace with the needs of roads.

It’s not transparent. People have no idea how much they pay, and where the money goes. Most people think it’s a sales tax charged at a fraction of the price of gasoline. But it’s actually a flat charge per gallon used.

Also, a great many states and the federal government divert a significant fraction, 20% to 30% in many cases, to non-highway uses. So it’s not like your electric bill that goes 100% for electricity.

So make it simple. Make it strictly a payment to use the roads. Replace the fuel tax, don’t add to it. Make it fair to all road users. Make it transparent so people know what they’re paying and where it’s going. And offer people a choice of how to report their miles and report only the miles, not all the details, so it’s not Big Brother. And insist on strict privacy protections.

Then the other thing is, I think, instead of saying we have a big revenue shortage, focus on how the highway system needs help.

TDR: Are there any particular types of roads that governments should try tolling on first?

Poole: Well, the interstate highway system is not fit for the 21st Century. And 25% of all vehicle miles traveled is on the interstates. If you include other limited-access roads like freeways, it’s about 35%.

So this could be the starting point for a transition from per-gallon to per-mile charging. Congress once asked the Transportation Research Board to study the future of the interstate system and a report came out in December of 2018. It concluded that we really basically need to replace most of the interstates except the ones that were developed in the last decade or two. The pavement is finally wearing out and bottleneck interchanges are numerous. Many corridors don’t have enough lanes for the realistic projections of traffic growth.

So, at the Reason Foundation, I authored this report that came out last year saying, ‘We can do this with toll financing.’ Each state could choose to do this and pay for a really major revamp and produce a better interstate system that’s fit for the 21st Century.

About Dan Shaw, [email protected]

Dan Shaw is the associate editor at The Daily Reporter. He can be reached at [email protected] or at 414-225-1807.

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