Equity Evaluation of Fees for Vehicle Miles Traveled in Texas

Abstract

The Texas state gas tax has been 20 cents per gallon since 1991, and the federal gas tax has been 18.4 cents per gallon since 1993. The gas tax is not only stagnant but also depreciating in value because of inflation. Thus, the money needed to maintain the infrastructure and improve roadways is not being adequately generated. One proposed alternative to the gas tax is the creation of a fee for vehicle miles traveled (VMT), with equity being a crucial issue. This research used Texas data from the 2009 National Household Travel Survey to consider the equity impacts of four VMT-fee scenarios. Data were filtered and weighted to reflect results representative of Texas vehicle-owning households in 2008. Each scenario was run both statically and dynamically under the assumption that the VMT fee would replace the state gas tax. On the basis of quantitative measures, the vertical equity of all proposed VMT-fee scenarios and that of the current state gas tax were similar. In terms of horizontal equity, Scenario 4 was designed to be inherently horizontally equitable: charging different rates for travel on urban roadways and rural roadways corresponding to funding needs associated with that roadway type. Scenario 3, which favored fuel-efficient vehicles, was found to be the least horizontally equitable and caused rural households to contribute the highest percentage of revenue of all scenarios considered. All other scenarios were found to be more horizontally equitable than the current state gas tax.