Senate Transportation advances draft to roll out mileage-based road charge with $178 first-year cap

The Senate Transportation committee met April 9 to continue drafting statutory language for a mileage-based user fee (MBUF) and approved two gubernatorial appointments to a transportation board.

Committee staff presented revised transition language intended to clarify how initial mileage reporting would begin for covered vehicles. Damon Leonard of the Office of Legislative Council told the committee the draft ties the initial reporting period to annual inspections for vehicles registered in Vermont as of Dec. 31, 2026, and to the date of registration for vehicles newly registered on or after Jan. 1, 2027. Leonard noted the draft still contains small edits and that DMV procedures for capturing odometer readings (inspection, dealer disclosure or registration paperwork) need to be clarified.

Michelle Boomhower of the Agency of Transportation said the agency plans to begin public education and outreach in July 2026 and that "the first people won't be encountering their first MBF bill until after January 1st, 2028," giving roughly 18 months for direct mail and dealer training. She told the committee the MyDMV system would provide options for advance payments or quarterly deposits and that invoices would generally be mailed at the end of a driver's mileage reporting period.

After extensive discussion about program design, committee members signaled support for adding a temporary flat-fee transition option for EV drivers and for setting a $178 maximum for the first year as a held-harmless cap. Under the instruction the committee agreed to send staff a draft that would allow vehicle owners either to (a) elect a flat up-front payment (examples discussed: $89 for one-year registration, $178 for two-year) or (b) report miles and be billed on actual usage with a $178 cap for the initial period. Committee members emphasized that the cap and flat-fee option are intended to reduce administrative friction and serve as a predictable transition for owners while the system is tested and outreach occurs.

Lawmakers also discussed whether the initial phase should be voluntary. Several members urged a voluntary or phased start to avoid administrative burdens and to protect EV adoption, while others said a broad initial participation rate delivers more policy value. The committee did not settle the question of mandatory enforcement at this meeting; members asked the agency to return the next day with options on enforcement and penalties, including what would happen to registration if fees go unpaid.

The committee asked staff to include in the draft: a $178 maximum flat-fee option for the first mileage reporting period, language clarifying odometer-reporting triggers, and a requirement that the agency return an initial report on or before Jan. 31, 2027 with recommendations about whether to keep or adjust the cap. Staff reminded the committee of other statutory deadlines discussed in the draft: a draft plan to the federal government by Jan. 1, 2028 and a final report due Sept. 15, 2028.

Separately and by voice/roll-call, the committee approved two governor appointments to a transportation board: Mark Nicholson (term described March 1, 2025–Feb. 29, 2028) and Pam Larger (reappointment); recorded tallies were 5-0-0 for both confirmations.

Next steps: staff will produce a redraft incorporating the $178 cap and flat-fee option, circulate it to committee members before stakeholder testimony, and bring agency analysis of enforcement and registration-penalty options back to the committee at its next meeting.