A Rocky Transition to a New Transportation Finance Regime

Source: Citizens for Tax Justice, Tax Justice Digest, August 15, 2008

A number of states are considering funding transportation infrastructure with “direct pricing” on the use of roads — e.g. by increasing the prevalence of tolling and instituting taxes on “vehicle miles traveled”. If coupled with relief for low-income drivers, direct pricing has the potential to adequately and fairly fund transportation while at the same time creating incentives to reduce driving and its corresponding ills (e.g. traffic congestion, environmental damage, and excessive wear-and-tear on the roads). But a new development in the already drawn-out debate over Pennsylvania’s plan to institute “direct pricing” (i.e. tolls) on its Interstate 80 highlights some serious equity issues involved in making the transition to this form of transportation finance.

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