A new tax is the hardest thing a legislature ever passes. Everyone suspects the same thing: that they will pay more so that someone else can pay less. The opposition is loud, bipartisan, and often kills the idea.
Oregon passed one anyway.
On his 70th birthday, Jim Whitty sat in the Oregon legislature and testified in favor of a per-mile road usage charge. None of the legislators were opponents. All of them had heard his case before, across three pilots and two voluntary programs. Governor Tina Kotek signed the bill. A mandatory per-mile road usage charge became law on January 1, 2026: 2.3 cents per mile, applied to electric and hybrid vehicles. It took 25 years.
Whitty’s persistence is rare in public policy. He came to the Mobility Forum and told us everything he learned. Here is what your state DOT can learn.
Today’s letter covers what you can take to work: why the gas tax is a fiscal dead end; the design that failed and the conversation that changed it; three decisions that determine whether a road usage charge passes; and four steps to take before the revenue crisis makes the choice for you.
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There are two arguments for a road usage charge. Only one of them will force the debate.
The first is about efficiency and economics.
“In no other major area are pricing practices so irrational, so out of date and so conducive to waste as in urban transportation.” —William Vickrey, 1963.
A per-mile charge, like congestion pricing and parking reform, is part of a broader toolkit for pricing mobility at its true cost. The intellectual foundation has been solid for 60 years.
The second argument is the one in your budget. Roughly half of U.S. transportation funding rests on the gas tax. Electrify the fleet, and that base trends toward zero. Oregon’s highway fund faced large, visible cuts as EV registrations rose. That revenue crisis, not a new economic argument, moved the legislature after 24 years of debate.
The System Whitty Built Wrong
Here is the part most retellings skip. The system Whitty originally designed was the wrong one.
The Oregon legislature stood up a task force in 2001. Whitty was hired from outside to design and test a per-mile charge. The first design used GPS to count miles. A reporter caught wind of it. The story went national. The coverage, left and right, was uniformly negative and almost entirely about GPS surveillance and privacy. For the next two months Whitty did media all day, every day, in damage control.
Whitty’s lesson: powerful opposition, if you actually listen to it, hands you the checklist of changes you need to make. Make them, and the proposal survives.
The first real pilot ran in 2006-7, with 300 participants. Most approved. Then the funding stopped. The Transportation Research Board asked Whitty to write a national report. During peer review, Robin Chase, Zipcar’s co-founder, called the work seminal, then told him it was built wrong. His system was closed: one technology, one provider who owns it, lowest bid wins. She said: consider an open system.
Does the Government Have to Use GPS?
For years, Whitty stood in front of audiences and promised that ODOT would protect the GPS mileage data. It failed every time.
The wall became visible during a talk to Oregon architects who asked one question: does the government have to use GPS?
He drove home and understood. Millions of people carry GPS chips voluntarily, in devices from private companies they chose. The difference was not the technology. It was who chose it.
The design flip: the government sets outcome-based standards and certifies private-sector account managers. Drivers choose among certified providers, or take the government option, which uses odometer readings and no GPS. No single entity owns the system. Privacy stops being a promise the state makes. It becomes a choice the driver makes.
The center-right liked the private-sector role. The privacy hawks liked being able to opt out of GPS entirely. The same design answered both camps.
In 2013, ODOT recruited state legislators to use the system themselves. They testified to a committee about how easy it was. The program still fell one vote short of the supermajority required for a tax bill, blocked by automaker opposition. Oregon ran a voluntary version, OReGO, with about a thousand participants, for twelve more years, until rising EV adoption eroded road revenue until large cuts loomed.
Whitty, by then retired, was asked back. This time there were no opponents in the hearing room. Republicans who had once blocked the bill deliberately left the road usage charge out of a voter referral on tax increases. They wanted it to pass.
Lost momentum is the real enemy. Opposition you can answer. A stalled cause simply waits for the next crisis to reopen the door.
The Antique Technology Problem
Robin Chase didn’t just suggest an open system. She diagnosed the procurement pathology that keeps producing old technology.
The tolling technology running America’s highways is largely unchanged since 1991. Norway ran the first electronic road tolls in 1986; the U.S. in 1989; Oklahoma’s Pike Pass in 1991 became the seed of E-ZPass, now in 19 states. London spent $243 million on its congestion charge in 2003. New York spent between $500 and $550 million on equipment in 2025, using the same camera-and-gantry approach, essentially unchanged 22 years later.
Standard procurement produces this. A 10-year sole-source contract, awarded to whoever offers proven technology, which means old technology. The winner builds proprietary infrastructure with no incentive to improve. Lock-in is the business model.
Fred Charlier founded Clear Road in 2017 and built equivalent zone-based pricing in Bogotá using smartphones and the city’s existing traffic cameras, at a fraction of New York’s outlay. As he told our Forum: the technology will do whatever legislators are willing to design.
Three Design Decisions That Determine Whether a Road Usage Charge Passes
Oregon’s path reveals three choices every state will face. None of them are about the technology.
One: Who chooses the technology determines who opposes the bill.
When the government mandates a technology, the privacy debate is about the government. When the government sets a standard and lets drivers choose their own provider, the privacy debate is about the provider the driver picked. The accountability shifts, and so does the politics.
Oregon’s center-right plus privacy-hawk coalition is repeatable in most states. The center-right gets the private-sector role. The privacy advocates get a GPS-free option they can choose themselves. The same design answers both. You cannot build that coalition without first building that design. Political outreach cannot substitute for what the architecture fails to deliver.
Two: Open market versus sole-source contract.
The antique technology problem is not inevitable — it is a procurement choice. Oregon breaks the cycle with two rules: providers compete for drivers, not government contracts; and the provider cut is capped at 10%. Tolling operators under standard contracts can take up to 40% of gross revenue. Most taxes run 10-20% in collection cost. At 10%, collection cost matches typical tax administration overhead. Nothing left for a private operator to extract and no political target for opponents to hit.
One more consequence of sole-source procurement that policy people systematically underestimate: it thins the market over time. When a government deliberates for a decade, it quietly eliminates most of its competitive options. An open-market design only delivers genuine competition if the market of providers still exists when the law goes live. Policy delay kills it.
Three: Simple first, layered second.
Oregon’s law does one thing at launch: raises road revenue, nothing more. The flat per-mile fee is not perfect.
But the fastest path to a stalled charge is to add all the complexity at once — pricing congestion, vehicle weight, emissions, driving behavior, time of day, and lane capacity simultaneously. All of these can be layered in by subsequent legislation against an existing rate structure. Get the instrument standing first. The nuance comes later.
What Your State Should Do Before the Crisis
Oregon and Minnesota built the foundation. Hawaii has enacted a road usage charge for EVs, launching around 2027. New Zealand is weighing a nationwide charge. The answers exist. Inherit them.
Four steps:
Model the gas-tax curve. Run projections at 20%, 30%, and 50% EV market penetration. In many states, that shortfall arrives within a decade. Know when yours does.
Talk to vendors before drafting. Vermont recently brought technology providers in front of its legislature before writing the bill. The standards you set in statute determine who can operate. Writing the law without understanding the technology often mandates the outdated approach by accident.
Adopt Oregon’s privacy framework wholesale. The language has been in statute since 2013 and survived legislative review in 2025: no data shared outside the system, no detailed travel records retained, short deletion windows, audit rights in every contract, penalties for misuse.
Build the opponent coalition’s answers into the bill before the hearing. Your loudest opponents are not the obstacle. They are handing you the checklist. Name the center-right concerns and the privacy concerns explicitly in the design.
The gas tax is not going to be voted out of existence. It will be electrified out of existence. Do not wait for the revenue crisis to force action. Oregon documented the whole thing. Use it.
–Jinhua
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Jinhua Zhao
Professor of Cities and Transportation, Massachusetts Institute of Technology
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