Transportation Revenue Options Commission Submits Report To Wolf, General Assembly

The Transportation Revenue Options Commission released its final report on July 30,2021. Created by an executive order signed by Governor Wolf in March, the Commission was tasked with developing a strategy for ultimately replacing the current state gas tax with other revenue streams.

According to PennDOT, other revenue options are needed as motor fuel tax revenue is falling due to an increase in higher fuel-efficient vehicles on the road. The report-and a more detailed presentation of its finding can be found here.

One key recommendation in the report is the adoption of a vehicle miles travelled program, which would impose a fee of 7.8 cents a mile on the total of the total miles logged on a vehicle annually. Another recommendation would establish a fee on electric vehicles-which has been called for by many legislators.

A new recommendation would establish a per package delivered fee. The reasoning behind this idea is that the number of package delivery vehicles (UPS, Fed Ex) has exploded in recent years due to the proliferation on online sales of goods. The plan also proposes a significant increase in vehicle registration fees.

Reaction to the plan (even from of those serving on the panel) was far from unanimous. Several pointed out that to be feasible, the vehicle miles travelled concept would need to be federal-otherwise the state would lose revenue from travelers who vehicles are not registered in Pennsylvania but drive through the Commonwealth.

Concerns were also raised as to how such a tax would be enforced and collected. Business groups raised concerns as to the negative impact increased registration fees and a package fee would have on those industries. Other key legislators expressed the need for PennDOT to demonstrate significant increases in terms of efficiency and cost savings before many conservative lawmakers would even consider new revenue measures.

Most observers are saying it would be years before many of these plans would even be considered. Meanwhile, tension continues between PennDOT and the Senate in regard to the Department pushing ahead with its interstate tolling plan. PPA will continue to closely monitor these issues going forward.

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