The Federal Highway Administration will publish a notice Tuesday that asks states to bid for millions of federal dollars that will be given to projects aimed at developing alternative ways to fund the Federal Highway Trust Fund, which could include systems that impose taxes based on how far people drive.
FHA’s grant notice says it will spend up to $15 million this year, and $20 million over the following four years, on projects led by a state or groups of states that seek to develop “user-based alternative revenue mechanisms” for federal highway funding.
Many have argued that the federal gas tax is no longer enough to provide the funds the federal government needs to help pay for highway projects. The Congressional Budget Office suggested this month that the government is short by more than $10 billion each year, and others say fuel-sipping cars have reduced demand for gasoline and thus shorted the government of funding.
To solve the problem, some suggest taxing people based on how much they use the roads that are increasingly in need of repair. A specific idea is taxing people based on how far they drive, a possibility that FHA acknowledged as an option for states to explore, even as it acknowledged some of the problems related to that option.