House committee hears experts on mileage‑based user fees, discusses pilot to shore up declining fuel tax revenue

The Michigan House Transportation Infrastructure Committee heard detailed presentations on mileage‑based user fees — also called road‑usage charges or vehicle‑miles‑traveled (VMT) fees — and the logistics of running a state pilot to replace declining fuel‑tax revenue.

Committee members heard from Baruch Feigenbaum, senior managing director of transportation policy at the Reason Foundation; Ankur Agarwal, CEO of Geotoll; Tom Gustafson, Geotoll chief strategy officer; and Ed Noyola and Denise Donahue of the County Road Association. Presenters described collection options, privacy safeguards, equity issues for rural drivers, and cost estimates for running a pilot program.

The presentations came amid concern that improvements in fuel efficiency and more electric vehicles are eroding Michigan’s motor fuel tax revenues, the primary source for road funding. Feigenbaum said the fuel tax has lost purchasing power and will not be a sustainable long‑term revenue source: “The fuel tax is like a rock star on his farewell tour,” he said, arguing that a mileage‑based system is a practical alternative.

Why it matters: State and county road agencies rely heavily on fuel‑tax receipts to maintain roads. Presenters and committee members framed a pilot as a way to test technology, privacy protections and payment options before any permanent policy change.

What presenters said - Baruch Feigenbaum (Reason Foundation) gave an overview of mileage‑based user fees…