Editorial: Steer clear of the state’s gas tax dead end

By The Herald Editorial Board

Over the last 10 years, this editorial board has put a few miles into writing about the need for Washington state to begin a transition away from the state’s gas tax.

At the time, the state was collecting 44.5 cents a gallon at the pump and had the second-highest gas tax in the nation, but as the Washington State Transportation Commission, the Department of Transportation and others noted, the gas tax was bringing in less money, for three reasons: The tax wasn’t adjusted for inflation, meaning it bought less for projects that were affected by inflation; and even ten years ago, fuel efficiency was improving and hybrid and electric vehicles were gaining in use.

Ten years down the road, the gas tax has increased by a nickle — and is now the fifth-highest in the nation, behind California, No. 1 at 69.8 cents a gallon — but that nickle has fallen far short of meeting our transportation needs.

Even as total miles driven on state, county and city roads have nearly returned to pre-pandemic levels — 58.9 billion miles in 2023, if you were wondering — the growth of electric and hybrid vehicles and even more fuel-efficient engines has sped up the decline in gas tax revenue.

At its peak before the pandemic, in 2019, the state’s gas tax brought in $1.46 billion. By 2023, that figure bounced back from the covid years but was still at only $1.3 billion. State lawmakers, who are beginning work on a transportation budget for 2025-27 have projected a $1 billion shortfall for transportation needs, meaning that some ambitious plans outlined just two years ago in a $17 billion transportation budget are likely to be delayed or even paused.

Rather than continuing to nickel-and-dime the gas tax, it’s time for a shift to revenue that provides sustainable funding and a fair contribution from all who use our roads, bridges, ferries and more.

Following 12 years of study by the transportation commission and discussions among stakeholders and lawmakers — and past attempts at adopting legislation — the Legislature again is considering a bill that would begin the shift from the gas tax to a road-usage charge, also referred to as a per-mile fee, assessing a fee for each mile driven, in lieu of the gas tax.

Proposed by Rep. Jake Fey, D-Tacoma, House Bill 1921, would begin a eight-year program that would start voluntarily in mid-2027, for those driving electric and hybrid electric vehicles. Vehicles would be charged 2.6 cents per mile, with an annual fee assessed based on odometer readings — submitted by vehicle owners — when vehicle licenses are renewed. Owners of those vehicles would not pay the current annual fee charged for those vehicles, $225 for EVs and $75 for hybrids.

The road-usage charge has two fundamental principles, Fey said at a Feb. 13 House transportation committee hearing.

“One is to try to treat vehicle owners in a similar fashion to pay their fair share of the transportation investments,” he said. “The second principle is to focus this revenue on our greatest need, and our greatest need in this state is to preserve what we have.”

Beginning in 2029, the program would become mandatory, and would start to include vehicles with internal combustion engines — ICE, for short — starting in 2031 for vehicles with a fuel economy rating of 40 mpg or better, then lowering the fuel economy level each year until 2035 for vehicles getting 20 mpg or better.

The road usage fee owed would be reduced by a credit for fuel taxes paid, as determined by the state Department of Licensing. With a standard deduction for a year’s first 200 miles driven.

One comparison estimated that a driver of a car that gets 25 miles per gallon typically pays about $20 in gas tax for every 1,000 miles driven, but would be charged $26 under the per-mile fee, meaning $6 would be collected for that 1,000 miles.

The annual reporting of miles would be voluntary, but any discrepancy in reported miles driven and actual miles could be determined and billed at the time a vehicle’s sale is reported to the licensing department.

Washington state isn’t covering new ground here with the per-mile fee, said Reema Griffith, executive director of the Washington State Transportation Commission, which has led studies and a pilot project on the switch to a road usage charge for 12 years.

Griffith, speaking at the committee hearing, said the House bill’s model has proved successful in other states that have adopted a road usage charge, praising the legislation’s simple approach in using odometer reporting.

The commission, during a pilot project that a Herald reporter participated in, used a device that recorded mileage, but even though the device didn’t record starting points, destinations or routes, now says it’s simpler and less of a privacy concern to determine the fee through an odometer reading.

Four other states in the nation — Oregon, Utah, Hawaii and Virginia — have active road-usage charge programs, Griffith said, and a majority of states are considering the same move, as is the federal government, which currently charges 18.4 cents a gallon for the federal gas tax.

After 12 years of study and debate, Griffith said the state should move forward.

“It is critical that you act now to shore up transportation funding and stop the continued erosion of gas tax revenues,” Griffith told the committee in recommending passage.

Kirk Hovenkotter, executive director for the Transportation Choice Coalition, a policy advocacy non-profit, supported the proposal as a win for the state that establishes sustainable transportation funding for the next 100 years.

“It funds what matters most. It creates a dedicated revenue source for preservation and maintenance and commits to fixing what we already have, like rebuilding the main streets of our communities. It will put Washingtonians to work redesigning our highways to be safer … and creates a new funding source for sidewalks, trails and transit.”

There may be details to be worked out as the legislation moves forward; some drivers might prefer an odometer recording device that reports and charges the fee on a monthly or quarterly schedule, for example. And some level of gas tax might make sense to maintain for legacy ICE vehicles that remain on the road after 2035. The one plus that the gas tax has had is that it is an effective tax on carbon emissions; the more fossil fuels consumed — by less-efficient vehicles or by jack-rabbit drivers — the greater the tax that is paid.

Yet, 12 years down the road, the state must now move forward with a plan that steers the state’s transportation revenue away from the dead end of the gas tax.