A bill to study a possible tax on the number of miles Connecticut residents drive has returned after the Senate unanimously voted against the idea in 2017.
Sponsored by Rep. Cristin McCarthy Vahey, D-Fairfield, who serves on the Transportation Committee, the bill would authorize Connecticut’s Department of Transportation to “study and participate in federal pilot programs regarding a mileage-based user fee on motor vehicles operated on state highways.”
The new bill comes as Connecticut’s Special Transportation Fund faces a near-term deficit due to revenue losses related to the pandemic and fewer commuters purchasing gasoline, the largest source of funding for the state’s transportation needs.
Gov. Dannel Malloy pushed for Connecticut to participate in a $300,000 federal study in 2015. Participation in the study came as a shock to members of the Transportation Committee, led to public backlash. Participation in the study was eventually scrapped by CT DOT Commissioner James Redeker.
The mileage tax – known as Vehicle Miles Traveled Fees – is currently under study by the University of Iowa Public Policy Center and involves 12 cities, according to the FHWA. The mileage tax would be assessed by a GPS transponder in the vehicle which records the number of miles driven.
A 2015 study of public opinion on a mileage tax conducted by the National Academy of Sciences noted there were 26 states at the time considering mileage fees, but found only an average of 24 percent of participants across various supported a mileage fee or tax.
Even when coupled with elimination of the gasoline tax, public support remained very low, but that public opinion could shift as drivers learned about and became more comfortable with the idea, according to the study.
Connecticut’s participation in a milage tax study or pilot program would not mean a mileage tax would be sure to follow and such a move, if even possible, would be years in the making.
Connecticut’s fortunes have shifted over the course of the pandemic to a more optimistic note as revenue to the General Fund has increased and replaced a projected current year deficit with a surplus.
However, the same cannot be said of the Special Transportation Fund as many commuters have shifted to working from home.
According to the Office of Fiscal Analysis, revenue from the gasoline tax is projected to be $37.7 million lower and the oil companies tax will be down $126.7 million. The STF was able to lower expenditures by $70 million through lower debt service spending, leaving a fund balance of roughly $112.9 million.
But that balance is expected to be wiped out and the transportation fund left in deficit by 2024 as rising costs related to bonded debt will result in higher expenses.
Gov. Ned Lamont said he will not pursue tolls this session but is reaching out to other groups to find new revenue streams for the STF in order to leverage federal infrastructure loans.
The governor also signed Connecticut onto a memorandum of understanding with the Transportation and Climate Initiative.
TCI was meant to be a regional cap and invest system across 12 states and Washington D.C. and would require gasoline producers and distributors to purchase emissions credits at auction. The money would then be funneled to participating states to fund climate justice initiatives, electric cars and public transportation.
Thus far, only Connecticut, Massachusetts, Rhode Island and Washington D.C. have signed the MOU.
Lamont expects TCI to bring in roughly $100 million per year to the state but would also raise the price of gasoline between 5 and 17 cents per gallon depending on what cap is placed on gasoline wholesalers.
**Meghan Portfolio contributed to this article**