Recently it was reported that tolling for single-passenger rush-hour drivers on Interstate 66 inside the Beltway is scheduled to begin in 2017.  A major barrier was crossed as the Northern Virginia Transportation Commission (NVTC) inked a 40-year deal with the Commonwealth of Virginia giving NVTA a voice in how revenue from the project will be spent.  In the coming weeks, the Virginia Department of Transportation will announce whether it wants a private partner to build and operate toll lanes on I-66 outside the beltway, and decide whether such lanes may be tolled inside the Beltway.  

When the interstate system was originally built in the 1950s and 1960s, Congress envisioned that the federal fuel tax, collected at the pump, would fund the system.  Unfortunately, over the decades that followed, Congress repeatedly allowed projects and earmarks that were not related to or part of the interstate system to slowly siphon money from the Highway Trust Fund.  By 2007, it was estimated that only about 80 percent of all federal fuel tax money was actually making it to the interstate system.   


Following 2008, as the economy slowed, consumers drove less than ever before, and at the same time started to use more fuel-efficient vehicles and public transportation.  The net effect was a dramatic decrease in federal fuel tax revenue, at a time when construction and maintenance costs were increasing.  What we have been left with is a system of finance for the interstate system that is simply not sustainable.  Even with a dramatically large gas tax increase at both the federal and state levels, the Highway Trust Fund that receives such fuel taxes at the federal level would still be challenged by the ever-increasing efficiency of vehicles, usage of public transit, and continued reduction in driving.  

One sustainable path is through a “user pay” system that utilizes tolls or vehicle-miles-traveled fees in lieu of fuel taxes.  User pay systems are much like utility fees, which are based exclusively on the amount of usage from a facility.  Much like we pay an electric bill, a user fee would be based on how much we utilize the system. It also encourages more efficient usage, as users only make use of the roads at a time when they need to do so, such as commuting to work, thereby reducing congestion from non-essential travel during rush hour.  Variable priced tolling or dynamic tolling would automatically lower the toll price during off-peak hours.   

Revenues from such fees can be dedicated solely to the interstate highway from which they were derived.   As chief counsel of the Federal Highway Administration, I encouraged user fee systems as a viable replacement for fuel taxes.  As we phase out fuel taxes, we should implement a corresponding income tax deduction in the Internal Revenue Code for tolls paid by such users so they can write off such fees, instead of paying both a fuel tax at the pump and tolls.  
As Congress struggles with how to pay for interstate system maintenance, now that the network is completed, there is no longer a need for fuel taxes since technology exists to implement user fee systems.  The only sustainable financial path for cities like Washington, which are dealing with declining revenues and crippling congestion, is to implement user fee systems through tolls that replace fuel taxes.  

Lemon is a shareholder with Polsinelli P.C., a top DC law firm. Formerly he was the presidentially appointed chief counsel to the Federal Highway Administration (FHWA), and a former advisor to the FHWA administrator and Secretary of Transportation on Public-Private Partnerships (P3s).