What San Diego’s Per Mile Road Usage Tax Could Mean for Other Cities Across the U.S.

January 24, 2022

California has been testing out road usage charging programs for many months now, and it looks like they are finally ready to start implementing them in some cities such as San Diego. The road usage charge tax they are proposing is just one of many changes they intend to make to their transit plan. Road usage charges are a new method that many states are considering to fund infrastructure initiatives. It is meant to replace the gas tax, which is no longer keeping up with inflation or the increasing amount of electric and fuel-efficient vehicles. Oregon and Utah already have road usage charging programs in place, which have been successful. For a city like San Diego, where traffic is a significant concern, updates to the transit system are necessary to keep up with the growing population to keep drivers safe and roads efficient.

What is San Diego’s Proposal?

San Diego has proposed a road usage charge that is significantly higher than those that are already in place in Oregon and Utah. While Oregon’s road usage charge is 1.9 cents per mile, Utah’s is 1.52 cents per mile. However, San Diego’s proposal is four cents per mile, then two half-cent regional sales taxes proposed for 2022 and 2028. The San Diego Association of Governments’ plan is to obtain $160 billion to create no-cost public transit and a $43 billion regional rail network over 200 miles long. You can read more about their proposal here. SANDAG planned the timeline of the taxes so that they would align with these efforts and give the state time to plan pilots for potential fund raising strategies that allow for flexibility for the future.

SANDAG chair and Encinitas Mayor Catherine Blakespear said of the proposal: “The 2021 Regional Plan is an unprecedented investment in the San Diego region’s future. We have listened to the community and are proposing a modernized transportation system through the 2021 Regional Plan that works for everyone, with affordable options that get us to the people and places we want to go in a safer and cleaner way.”

What Do San Diego Residents Think of This Proposal?

As with any new tax or charge, this proposal has faced a lot of backlash from San Diego residents. SANDAG received over 1,500 comments regarding the proposal, and many of them were critical.

One significant criticism that often comes up with road usage charging is the worry that people are being discouraged from driving their own cars. Jim Desmond, San Diego County Supervisor, voices this exact concern: “This proposal should never see the light of day. San Diegans already pay some of the highest prices to drive in the country. From the current gas taxes to a vehicle registration tax, San Diegans feel the effects, in their wallets, every day.”

This proposal also comes as a surprise after California’s pilots, where they have been testing 2-cents per mile fees, not 4-cent per mile fees. This fee is over double what other states are charging and may cause concern among not only San Diegans but people all over the country who are worried about road usage charging.

Finally, California did have some difficulty during their pilot with measuring mileage, particularly when the miles were out of state. SANDAG has not yet clarified how they will count out-of-state miles, so this concern remains an issue.

How Can These Issues Be Addressed?

Many of these issues have come up with past proposals and even with implementing other road usage charging programs. States like Oregon and Utah have already dealt with these problems and have successful road usage charging programs in their states. We will go over how they addressed these issues in this section.

As far as the high prices, this is undoubtedly a concern for any driver. San Diego is currently looking at implementing road usage charging on top of the gas tax, which has not happened before. Utah and Oregon reimburse their drivers for what they pay in the gas tax, as the road usage charges bring in more money than the gas tax. Furthermore, they also offer discounts on registration fees to incentivize drivers to join their road usage charging programs. This method makes a lot of sense since road usage charging should eventually replace the gas tax anyway.

Furthermore, it may be that San Diego should lower its road usage charging charge to match what other states are doing. Kauai, Hawaii did a study regarding the road usage charge, and they found that the amount that Oregon is charging is about the exact amount that people pay in the gas tax each year, meaning that drivers aren’t affected as much. At the same time, the state still makes more money because more drivers are paying in.

Finally, as far as implementing out-of-state miles, Oregon currently credits drivers for their out-of-state miles. San Diego can take a page out of Oregon’s book to ease implementing out-of-state miles.

What Does This Mean for Other States?

The backlash that San Diego is facing with its road usage charging program may not bode well for other states. Still, if they can turn their program around and create something successful, it can positively impact our nation’s infrastructure. The fact of the matter is, our nation’s infrastructure is in a serious state of disrepair, and the gas tax simply doesn’t cut it anymore when it comes to funding its repair and maintenance. The road usage charge is a great solution, but it must be implemented properly. San Diego is on the right track as long as they listen to their citizens and follow in the footsteps of states that have already found success.

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