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Washington State Road Usage Charge Assessment Anthony L. Buckley

This assessment evaluates the need for a sustainable revenue source for Washington State's transportation system, transitioning from the current gas tax to a road usage charge. It explores the impact of fuel efficiency, electric vehicles, and consumer demand on future funding needs.

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Washington State Road Usage Charge Assessment Anthony L. Buckley

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  1. Washington State Road Usage Charge Assessment Anthony L. Buckley Director, Office of Innovative Partnerships Washington State Department of Transportation

  2. By 2027, 70% OF State GAS TAX REVENUEs will Go TO DEBT SERVICE PAYMENTS* *Based on Net Fuel Tax Revenue and Debt Service projections per the Nov 2016 Forecast. - Debt service only includes debt first payable by the fuel tax. This excludes SR 520 corridor debt service (first payable by tolls), but includes Tacoma Narrows Bridge debt service (reimbursed by tolls). - WA state’s portion of fuel tax revenue does not include all fuel tax revenue pledged for debt service. For example, revenue distributed to cities and counties is also pledged for debt service, and beginning in FY 2019, revenue from select vehicle fees (for selected projects).

  3. Gas Tax Increases Will Not meet our revenue Needs • The gas tax in Washington State would have to be raised about 1.5 cents per gallon, per year on all vehicles from 2019-2043 in order to equal net revenues from a road usage charge of 2.4 cents per mile. • This would keep funding at status quo levels. It does not address growing needs for improvements or maintenance.

  4. WHAT’s Driving RUC? • Increases in Fuel Efficiency & Production of EVs • Changes to federal CAFÉ Standards are not likely to stem consumer demand for higher MPG vehicles: • Volvoplans to produce only hybrid and electric cars starting in 2019 • General Motors recently announced that its future fleet with be all-electric, with 20 electric models available by 2023 • Toyota2017 Mirai - powered by hydrogen fuel cell with an EPA rated 312-mile range. Plans to shift to hydrogen fuel cell fleet in the next 15+ years • Fordis investing $4.5 billion to transition to hydrogen fuel cell and other alternative fuels over the next 15+ years • Nearly 400,000 people put down a $1,000 deposit for Tesla’s all-electric Model 3

  5. The Basis Of The Assessment Identify a sustainable, long-term revenue source for Washington State’s transportation system, and transition from the current gas tax • Ensure there is consumer choice on how mileage information can be collected and paid • During the transition period of moving from the gas tax to a road usage charge, drivers would pay one or the other, but are note intended to pay both • For purposes of assessing the gas tax against a road usage charge, we have assumed revenue neutrality and focused on net revenue potential for both

  6. SNAPSHOT: WASHINGTON’S RUC PILOT PROJECT • Federal FAST Act funding: Surface Transportation Funding Alternatives Program Grants: • Stage 1 - Final Design & Set-up, $3.874 M -- complete • Stage 2 - 12-month live pilot, and Stage 3, evaluation and reporting: $4.6 M -- underway • Summary of Washington RUC Pilot Project: • Year-long, statewide test of Washington-designed RUC system for 2,000volunteer test vehicles • Partners: Oregon Department of Transportation, City of Surrey, BC, Idaho Transportation Department, Seattle Electric Vehicle Association and Plug-in America • Mileage Reporting Choices: Mileage Permit, Odometer Charge, Automated Mileage Meter (2 types), and Smartphone Idaho Oregon

  7. 2,000 PARTICIPANTS SELECTED FROM A POOL OF NEARLY 5,000 FROM AROUND THE STATE Data as of February 23, 2018

  8. SIX UNIQUE FEATURES OF THE RUC PILOT 1RUC across borders: testing how RUC will be applied and function between states and Canada 2Smartphone Innovation Challenge: 3Private business partners: private vehicle licensing offices to help administer odometer readings a new app to deduct out-of- state miles for RUC 5 Use of consumer products for RUC operations: using an existing consumer product (Automatic™) for RUC mileage reporting 4 Financial interoperability test: how two states with their own RUC rates reconcile tax collections for miles driven within their jurisdictions 6Electric vehicle drivers: feedback whether drivers prefer RUC over other road funding options (EV fees)

  9. WASHINGTON’S GUIDING PRINCIPLES FOR A RUC SYSTEM

  10. Thank you. Anthony L. Buckley Director, Innovative Partnerships Washington State Department of Transportation 360-705-7039 bucklea@wsdot.wa.gov

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