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Lawmakers debate inflation indexing and equity as mileage‑based user fee advances
Summary
Committee members and agency officials debated whether to include an inflation adjustment for a mileage‑based user fee (MBUF), weighing purchasing‑power arguments against affordability and regressivity concerns; agency staff proposed delaying any inflator until more vehicles are included in the program.
The House Transportation committee continued a lengthy discussion of a mileage‑based user fee (MBUF) and whether the program should include an automatic inflation adjustment. Patrick Murphy, the state policy director, framed MBUF as part of a multi‑year effort that began with a road‑usage study in 2021 and said the program’s design seeks to replace declining fuel‑tax revenue as vehicles electrify.
Murphy explained the administration’s proposal for an inflator tied to a highway construction index used by other states to preserve purchasing power of transportation dollars. He said one option is to delay applying any inflation adjustment until a broader set of vehicles is included in the program so the change is coordinated across the fleet.
Lawmakers expressed concerns about regressivity and fairness: several members said indexing the MBUF now—applied to the subset of vehicles in the pilot—would unfairly raise costs on EV drivers while the gas tax remains unindexed. One member argued the gas tax is currently more regressive and that a mileage fee could be designed to be fairer; others said removing an inflator or tying it to the same mechanism used for the gas tax would be more equitable.
Patrick confirmed the agency has federal grant money and state match set aside; the MBUF pilot will start with a limited number of vehicles (committee discussion referenced about 13,000 vehicles in initial scope) to limit complexity. He said the agency can provide interim updates to the committee (suggestions included a six‑month brief after launch and a fall update), and that a final federal grant report is due to the legislature in 2028.
No final decision was taken on indexing during the meeting; committee members asked counsel and agency staff to continue refining the language and implementation schedule and agreed to revisit the issue at an upcoming markup and before further floor action.
