User fee study reveals cost penalty for fuel-efficient trucks

Mileage-based pilot project concludes “one rate for all trucks doesn’t work”

Study aimed at finding transportation funding options. (Photo: Jim Allen/FreightWaves)

The nation’s first multi-state mileage-based user fee (MBUF) truck pilot project concluded that using one rate for all trucks can put fuel-efficient trucks at a disadvantage when it comes to paying for roads and bridges.

The results of the study, released Tuesday by the Eastern Transportation Coalition (formerly the I-95 Corridor Coalition), are to be used to assess the MBUF as an alternative to raising federal diesel taxes and other approaches to funding transportation infrastructure.

“Though neutral on whether such a model presents the ultimate answer to the fuel tax conundrum, the Coalition believes evaluating these fees in real-world scenarios is central to finding a sustainable solution,” according to a statement.

The six-month truck pilot took place Oct. 1, 2018, to March 31, 2019, with over 50 trucks traveling more than 1.43 million miles across 27 states. Fleet management technology company EROAD, the coalition’s research partner, helped guide the design of the pilot using its mileage-recording technology.


Truck type, age make a difference

“The pilot clearly showed that one rate for all trucks doesn’t work due to the vast differences in vehicle operations, types, ages, performance and mileage travelled,” according to the study. Rates for the pilot were based on each state’s diesel tax and an assumed average fuel efficiency of 6 mpg.

While the rate was designed to be “revenue neutral” for the collecting agency, three of the four fleets involved in the pilot had average mpg values less than 6, which resulted in a net MBUF credit, because the MBUF amount charged was less than the state fuel tax paid.

The study provided examples of one trucking company study participant with 40 trucks with an average mpg of 3.42, which would have received a rebate of over $68,000 per year in state fuel taxes using the 6 mpg rate. On the other hand, the company that had the most fuel-efficient fleet would have been asked to pay a penalty of over $1,400 for its five fuel-efficient trucks.

“In other words, one MBUF rate across all trucks would create a situation where fuel-inefficient fleets would be rewarded and fuel-efficient fleets would be penalized,” the study concluded.


ELDs would need adjustment

The results of the pilot also found “key differences” between electronic logging devices (ELDs) and the MBUF even though policymakers and trucking experts tend to link the two. For example, ELDs track a truck driver’s workday to ensure compliance with federal hours-of-service rules, and as part of that task, only require the collection of location data at a minimum interval of one hour.

“In addition, ELD data (as per minimum requirements) cannot provide a distinction of mileage by states and does not cover all commercial vehicles,” according to the report. “Given MBUF would be linked to financial transactions, the ELD self-certification approach by the technology provider would need to be adjusted. For these reasons, the report concludes MBUF for commercial vehicles will require a more robust technology solution than offered by ELD functionalities alone.”

More data needed

The project coordinators acknowledged that while the pilot provided valuable insights, it also identified the need for further research to determine if an MBUF can be a long-term funding solution.

“This study is a good first step, and we agree with the Coalition’s report that additional data is still needed before any nationwide policy on MBUF can be pursued,” commented Truckload Carriers Association President John Lyboldt. “We hope that the Coalition’s work will provide a signal to federal policymakers that it is premature to start transitioning to a new revenue collection model and that significant questions must be addressed regarding MBUF implementation, especially for the trucking industry, before moving forward.”

Owner-Operator Independent Drivers Association President Todd Spencer said that his members have “serious apprehensions” about fairness, privacy, security and regulatory hurdles related to the MBUF.

“We are grateful the Coalition’s latest report accurately reflects many of these concerns, which are often overlooked or ignored by other organizations exploring MBUF,” Spencer said.

The American Trucking Associations (ATA), which favors raising the federal diesel tax as the most efficient way to pay for infrastructure, wants to see more data and analysis.

“How we implement fees to pay for roads and bridges will have great impact on the $10 trillion in freight that moves across our country’s roads,” commented Bill Sullivan, ATA’s executive vice president for advocacy. “The Eastern Transportation Coalition is methodical and systematic about what can work — and what likely can’t — and we will continue to support this comprehensive, data-driven approach going forward.”


The Coalition is seeking participants for another round of truck-focused pilot projects that it says will be even more expansive. It will include 200 tractor-trailers recording mileage data across the nation over a six-month period starting Oct. 1.

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